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Enel advances Chile's first green hydrogen project


Will use wind power to be built in country's southernmost region

Chile previously announced plans to become a green hydrogen export hub

Italian energy group Enel is planning to build the first project to produce green hydrogen in Chile, a country that experts are tipping to be a major player in the fuel's future.

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Subsidiary Enel Green Power Chile, or EGP, is developing studies to install a hydrogen production plant in Chile's southernmost region of Magallanes. The plant, which could enter production as soon as 2022, would be powered by wind energy, the company said Oct. 2.

"For Enel, Chile has always been a laboratory for innovation," said EGP Chile's general manager James Lee Stancampiano, highlighting the company's investments in South America's first industrial-scale geothermal energy plant.

It would not only be the first green hydrogen plant in Chile but also one of the largest in Latin America, the company said.

Development of the project is subject to financing as well as environmental approval by Chilean authorities. The size of the plant was not specified.

Enel said it expected to participate in the project alongside local developer AME, and potentially Chile's state oil firm ENAP and Germany's Siemens Energy and Porsche.

The hydrogen unit will be located next to Methanex's giant Cabo Negro methanol complex, which has been running below capacity for several years due to a lack of natural gas supplies from neighboring Argentina.

Hydrogen can be used as the raw material for methanol production.

Chile is wagering on hydrogen as a major new export sector, which could rival the country's mining industry in size by the middle of this century.

The International Energy Agency has estimated that the country has a potential to produce 160 million mt of green hydrogen annually, doubling current global demand.

But while most predictions about Chile's hydrogen possibilities focus on the huge solar potential in the north of the country, the Enel project will harness the high wind speeds in Patagonia, a region which could become a center for hydrogen production, the company said.

The region offers constant wind flows, thanks to its proximity to Antarctica, which will be key to its development, Enel said.