Danish renewable energy producer Ørsted has announced it is scrapping its FlagshipOne hydrogen project despite increased operating profits in the first half (H1) of 2024.
Operating profit for the company registered at DKr14.1bn in H1 2024, increasing from 10.2bn in H1 2023.
In its interim report published on Thursday (15 August), Ørsted also announced increased earnings from its offshore facilities, higher profits and the commissioning of 2GW of renewable energy capacity.
Group President and CEO of Ørsted, Mads Nipper, said that generation from the Greater Changhua 1 and 2a, South Fork and Gode Wind 3 wind farms led to a DKr2.3bn increase in offshore wind earnings to DKr11.3bn.
Despite this success, Ørsted decided to cease development of its FlagshipOne green hydrogen-to-methanol project, citing slower-than-expected growth in the liquid e-fuel market in Europe.
The cancellation of the FlagshipOne project comes two years after the final investment decision (FID) on the giant e-methanol plant. FlagshipOne was set to produce hydrogen-derived fuel for the shipping industry.
Ørsted’s decision to cancel the project lost the company a total of DKr1.5bn in revenue.
Despite this decision, the company has pledged to continue its focus and development efforts within renewable hydrogen.
Commenting on the interim report Mads Nipper said: “Ørsted’s operations are performing well, and particularly the earnings from our offshore wind farms, and thus our core business, have increased. Therefore, we maintain our EBITDA [earnings before interest, taxes, depreciation and amortisation] guidance for the full year, and we increase our earnings expectations for our offshore wind business.”
Ørsted said it has deployed almost 2GW of renewable energy capacity since it presented its updated business plan in February.
The technology deployed will provide enough renewable energy for more than 1.5 million homes across three continents, the company said.
