Oil and gas major Chevron has performed a U-turn and invested in ACES Delta in Utah, US, one of the largest green hydrogen projects in the world, citing a “change of circumstances” when asked by Energy-Storage.news.
Through Chevron New Energies, the company has closed a transaction to acquire 100% of Magnum Development, which itself owns a majority interest in the ACES Delta green hydrogen project in Utah, a joint venture (JV) with Mitsubishi Power Americas. Chevron acquired Magnum Development from Haddington Ventures.
Enjoy 12 months of exclusive analysis
- Regular insight and analysis of the industry’s biggest developments
- In-depth interviews with the industry’s leading figures
- Annual digital subscription to the PV Tech Power journal
- Discounts on Solar Media’s portfolio of events, in-person and virtual
Or continue reading this article for free
The move comes a year after Chevron told Energy-Storage.news that the “opportunity to acquire an equity interest in ACES Delta no longer meets our requirements,” when it announced it was no longer seeking to do so.
Commenting on its reversed decision, a company spokesperson told us this week: “Chevron is consistently exploring opportunities around the world as we work to achieve our lower carbon goals and grow our lower carbon businesses.”
“While the original opportunity to acquire a minority interest in the ACES Delta JV in 2022 did not meet our commercial thresholds, circumstances have changed, and we believe this opportunity to be an attractive investment and a platform with immense potential.”
Asked to expand on this, they said the change of circumstances was “purely commercial” and not directly related to the Inflation Reduction Act (IRA) and its generous incentives for clean energy having passed since that decision.
Phase 1 of the project reached final investment decision (FID) before the Act was announced it had already received financial support from the Department of Energy (DOE), including a US$500 million loan.
“While I wouldn’t tie this decision to the IRA, the IRA will help accelerate the viability of some of the growth projects that are there, and we look forward to continuing to evaluate those,” they added.
The ACES Delta project will feature 220MW of electrolysers that will be powered by renewable energy to produce up to 100 metric tonnes of green hydrogen a day, to be stored in two huge salt caverns with a combined storage capacity of 300GWh.
ACES Delta will help power new 840MW combined cycle power plant from cooperative Intermountain Power Agency which will replace an existing coal plant. It will power 30% of Intermountain’s plant when it comes online in 2025 with plans to increase that to 100% by 2045. But that achievement could come as early as 2030 or 2035 according to Mitsubishi Power America senior VP Thomas Cornell in an interview with Energy-storage.news last year.