Feature 1:
Energy Transition

To help realize a net zero carbon society by 2050, INPEX is developing five net zero businesses: hydrogen and ammonia, CCUS, renewable energy, carbon recycling and new business, and forest conservation.

Introduction of bases for renewable energy, hydrogen, and CCS businesses

In 2023, we entered the Australian renewable energy business by investing in a local subsidiary in Australia of Enel Green Power S.p.A., a major Italian power and energy company.

In our hydrogen and ammonia business, we began con­struction of a facility in Kashiwazaki City, Niigata Prefecture for integrated demonstration testing of blue hydrogen and ammonia production and utiliza­tion in July 2023, with the aim of starting operation in 2025. Based on this, we are also aiming to commer­cialize the blue hydrogen business by around 2030. In Australia, a commercialization study on clean hydrogen was selected for the Australian govern­ment subsidy program in June 2023. In October, we took a stake in Japan Suiso Energy, Ltd. and decided to participate in a demonstration project between the two countries to esta­blish an inter­national liquefied hydrogen supply chain. One of the feature articles in this year’s report is related to this.

Hydrogen Business

We will commercialize 3 or more projects by around 2030 and aim to produce and supply 100 thousand tons or more of hydrogen and ammonia per year. Then, we will aim to expand our supply capacity to achieve approximately a 10% share of domestic demand by 2050.

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Reduction of CO₂ emissions from oil and gas operations (CCUS)

We aim to become a leading company in the CCS and CCUS business by targeting an annual CO₂ injection volume of 2.5 million tons or more in around 2030 and promoting technical development and commercialization. Then, we will aim to establish a CCUS business and generate profit from it by 2050.

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Renewable Energy Business

We aim to secure 1-2 gigawatts of installed capacity, mainly in the offshore wind and geothermal power generation business and become a key player by accelerating business expansion using assets acquired through M&A and other means as a platform. We also aim to produce green hydrogen¹ using renewable energy by 2050.

¹ Green hydrogen: hydrogen produced through the electrolysis of water using renewable energy such as wind power

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Hydrogen Business

https://www.youtube.com/watch?v=mLkDJqYh5I0

Use of hydrogen as a clean energy is expected to increase in the future as it does not emit CO₂ or harmful substances during use.

INPEX is conducting integrated demonstration testing of blue hydrogen and ammonia production and utilization in the Hirai area of the Higashi-Kashiwazaki Gas Field. The project will produce 700 tons of hydrogen per year from FY2025.

We will use a portion of this hydrogen as the raw material for producing ammonia, and use the remaining portion as a fuel for hydrogen power generation. As the raw material for hydrogen production, we will transport natural gas from our operations in Niigata Prefecture to the production facility using an existing gas pipeline. Employing CCUS, we will also inject CO₂, created as a byproduct of hydrogen and ammonia production, into reservoirs in the Hirai area of the Higashi-Kashiwazaki Gas Field, which has already finished production. This will ensure that the hydrogen and ammonia produced during demonstration testing will become blue hydrogen and ammonia with minimal atmospheric CO₂ emissions. Giving due consideration to safety and the environment, after the underground CO₂ injection begins we will appropriately monitor the injection operations and the injected CO₂.

This project marks Japan’s first endeavor of an integrated testing operation in this field. It will encompass all aspects of production of blue hydrogen and ammonia using domestic natural gas, to CCUS implementation in a depleted domestic gas field, and use of the hydrogen and ammonia for power generation and other uses. On a global level, there are very few blue hydrogen and ammonia production projects at the plant construction stage. Using our own depleted gas field and CCUS technologies, we expect this project to be the first in the world to realize production of blue hydrogen and ammonia.

Through demonstration testing, we will gain and accumulate technologies and experience ahead of other companies, spanning hydrogen and ammonia production to CCUS, hydrogen power generation, and beyond. This track record encompassing the entire supply chain will make us the front runner in the hydrogen and ammonia business in Japan and globally. Leveraging these achievements, we will acquire or participate in new projects not only in Niigata and other areas in Japan, and worldwide.

Comments from the people involved

Left to right: Akihiro Kohata, Koji Takase, Sota Kaneko

Sota Kaneko (Construction Unit, Domestic Exploration & Production Division)

As a member of the EPC team, I am involved in project management for the aboveground facilities. With few precedents globally, this project is facing many challenges without clear solutions. Nonetheless, I am confident we will gain knowledge as we overcome these challenges one by one. While continuing my work in constructing our plants, I will strive to maintain a safe work environment, free of incidents and personal injuries.

Participation in Outside Initiatives

Japan Hydrogen Association 

INPEX participates in the Japan Hydrogen Association and con­ducts a range of activities to support growth and expansion of the hydrogen industry. These activities include collaborating with governments, building domestic and international partner­ships, making government policy recommendations, and assis­ting in market development. We also share information on the latest domestic and international trends in technologies and markets, and promote domestic and international collaborations to help realize a hydrogen society.

CCUS Business

https://www.youtube.com/watch?v=AJa1PZn-IDs

Bonaparte CCS project—Australia

Carbon Capture and Storage (CCS) is a proven and safe technology that can avoid carbon dioxide (CO₂) from being emitted into the atmosphere by sequestering it deep underground for geological time. The International Energy Agency has concluded that achieving net zero by 2050 is simply not possible without large-scale global deployment of CCS.

The Bonaparte CCS Assessment Joint Venture—with INPEX (as Operator), Total Energies and Woodside Energy- was awarded the greenhouse gas assessment permit (G-7-AP block) in the Petrel Sub-basin in 2022. The approved appraisal work program includes a two-well-appraisal drilling campaign, new 3D seismic and a comprehensive post-well analysis program which will be conducted in 2024. The appraisal program aims to demonstrate the Petrel Sub-basin’s suitability for large-scale CO₂ sequestration which has the potential to host multiple hundred-million-ton storage project.

INPEX is actively working to decarbonize its upstream operations, to provide a stable supply of diverse and clean energy sources. Key to the planned decarbonization of the INPEX-operated Ichthys LNG facility is the development of a large-scale CCS facility close to Darwin. INPEX can provide Bonaparte CCS offers Ichthys LNG and other major emitters in the region the opportunity to implement CCS at scale and become the key foundation customer via the Darwin CCS Hub infrastructure.

Bonaparte CCS has the potential to provide significant CO₂ sequestration opportunities for overseas industrial emitters and help companies and countries meet their global net zero commitments. Bonaparte CCS can be an enabler for the development of the full CCS value chain, from regional emitters across a range of industries, CO₂ capture, aggregation, liquefaction, loading, shipping, receiving in Darwin, pumping/heating, transportation, and offshore geological storage.

Our team in INPEX Perth office is committed to deliver the Bonaparte CCS project around 2030 for large CO₂ abatement solutions to not only to Ichthys LNG project, but also to Darwin local emitters and overseas emitters to provide decarbonize solution to reach net zero target.

Message from INPEX Australia Vice President Growth

Hi, my name is Steve Ovenden and I lead the Growth Department in our Perth Office. One of our most important duties is the Bonaparte CCS (BCCS) project, where I oversee an integrated team of professionals from across the Australian Business to progress this important project for INPEX. Steven Curtis, CCS Manager, stewards the overall BCCS opportunity, with support from Exploration & Subsurface Evaluation, Drilling, Development, HSE, Supply Chain, Government Affairs and others—it’s truly an integrated effort. BCCS is an exciting project that is expected to play a large and critical role in decarbonising Ichthys and support INPEX’s ambition to achieve net-zero emissions by 2050. Importantly, BCCS will also protect our ongoing licence to operate and facilitate the sanctioning of new Ichthys backfill and expansion projects. The targeted saline reservoirs of the Petrel-Sub basin offer the potential for large-scale gigatonne level storage which provides the further opportunity for BCCS to support a large multi-user CCS hub in Darwin and realise CCS as a future viable business. It’s a pleasure and honour to be working on this very important project for INPEX.

Participation in Outside Initiatives

CCS+ Initiative

INPEX participates in the CCS+ Initiative, which aims to develop an integrated carbon accounting infrastructure for CCUS under Verra’s Verified Carbon Standard (VCS), the world’s most widely used greenhouse gas crediting program. We share information on the latest trends in CCUS-related technologies and markets, and actively support the spread and expansion of CCS, contributing to realizing a carbon-neutral society.

Renewable Energy Business

INPEX EGPA renewable energy acquisition

We have been working hard to diversify our Australian asset portfolio to include renewable energy assets and a strong pipeline of development opportunities. Following extensive negotiations and a competitive bidding process, in September 2023 we acquired a 50 per cent share in Enel Green Power Australia (EGPA).

INPEX is now firmly on the path to achieving one of our global net zero goals for renewable power generating capacity to secure 1–2 gigawatts (GW) of installed capacity by 2030.

Our newly established subsidiary INPEX Renewable Energy Australia P/L jointly owns EGPA, the Sydney-based subsidiary of Italian major energy company Enel Green Power (EGP).

The joint venture with EGP represents an exciting opportunity to shape a lower carbon future. Working together with EGP, INPEX is now jointly overseeing EGPA’s Australian renewable generation portfolio, targeting an increase in installed capacity through new project development.

EGPA is currently engaged in renewable energy operations across Australia including wind, solar, storage and hybrid projects, alongside expanding its activities in innovative solutions within its retail and trading operations—targeting operating a power generation capacity across Australia of 2–4 GW by 2030.

Message from New Energy Business Australia (NEBA):

INPEX and EGP’s joint venture relationship is founded on shared values. We are a closely aligned highly capable team, working towards a common goal—a cleaner energy future.

Within INPEX, EGPA asset management is a collaboration between our New Energy Business Australia Division (NEBA) in Perth and the Renewable Energy Business Division at Tokyo head office.

EGPA is accelerating its business development in a dynamic manner, so a variety of things are happening every day, and as a shareholder we are actively involved. We are working closely with EGPA’s management and the EGP team in Rome to provide strong support for its business development and operations.

NEBA is a strong team with diverse membership. EGPA-related operations are significant in NEBA’s diverse portfolio setting a foundation of renewable energy capability and capacity that will enable the future progress of new energy and carbon offset projects. EGPA is a large-scale and important asset for INPEX’s global renewable energy businesses and diversifying our energy to market portfolio, as together we progress our shared net zero 2050 goals.