New developments point toward Woodside’s proposed hydrogen plant being on thin ice.
During a call with Ardmore Development Authority and City of Ardmore leaders, Woodside announced there would no longer be a final investment decision regarding the hydrogen plant in 2026 and did not provide a new date. In a statement to The Ardmoreite Friday, Woodside Corporate Affairs Principal Sasha Brown provided a statement from the company’s recent Q1 results.
“With the acquisition of Beaumont New Ammonia, plans for Woodside’s H2OK project are being reassessed.”
ADA President & CEO Bill Murphy said Woodside will now let the city know within 30 to 60 days whether there will be a final investment decision or if it will unwind the project.
“They let us know that they would not be making a final investment decision in 2026,” ADA President & CEO Bill Murphy said. “Primarily because there is still no direction from the administration on the federal tax incentives that were passed as part of the inflation reduction act.
“So, we shared with them our concerns that there are a lot of resources tied up related to this project, specifically from the ADA’s perspective, a potential incentive that we were looking at for $2 million. The city’s commitment to build a gray water line to the facility. Not only is that an expense of about $8 million but that is also up to 2 million gallons of gray water.”
Murphy said the ADA had sold some industrial land that represented the last of the current industrial land for development.
“We still have to figure out the monies, that we put aside, which is one conversation,” he said. “The other conversation for us is on the land. We have communicated to the board that it will be something we will discuss as part of the solution, whatever they come back and share with us.
“If they are not going to move forward with the project, we would like to figure out a way to get that land back in the ADA’s name. That is not unusual, and it is not unfair to the company. It is just something that we have to figure out based on what the market conditions are going to be.”
Murphy said communications that have taken place suggest Woodside will be a good community partner and do right by Ardmore.
Woodside also informed the city to halt engineering work on the proposed water line for the gray water. Woodside has been reimbursing the city for the engineering costs on the project.
City Manager Kevin Boatright said the project represented a win-win for the city for several reasons. He agreed with Murphy that there were some things outside of the city’s control that put the project at risk, citing the federal tax incentives along with waning interest of the project’s intended customers and Woodside’s recent acquisition in Beaumont.
Woodside cited having a harder time making the economics of the project work, Boatright said.
“They indicated to us that it was the federal tax incentives and that it had implications for customers because the customers could not get definitive understanding of what the market would be,” Murphy said.
Murphy said the current administration has a different set of priorities and the ADA will figure out what the economic development priorities are and take advantage of them. Based on the necessity of the federal tax incentives to jump start the industry, Murphy said he does not see the administration moving quickly if at all on the new energy.
The project’s benefits to the city would have included the influx of workers during project construction along with the sale of gray water and the franchise fees from the electricity sold by OG&E for the project.
Boatright said there is a legally binding contract that the city cannot sell gray water and has to hold onto the $8 million in anticipation of the plant and water line being built.
“The one thing I did say to our city commissioners is that I feel that we honestly did everything we could to make this project work and everything that we committed to do towards this project, we did it,” he said. “We followed up and did exactly what we said we would do.”
Both the city and ADA had a great relationship with Woodside over the past four years Boatright said. He said both Murphy and ADA Sr. Vice President Andrea Anderson had done a lot of leg work on the project, taking meetings and trips. He also said the local legislators also worked hard on the project, going to bat at the state legislature.
Murphy said the ADA did everything Woodside asked to make the project a success. There was a commitment to meeting the revised timelines in addition to looking at creative ways to leverage local incentives.
“We demonstrated to them that we were going to do everything we could to help make this project happen,” Murphy said. “Sometimes, projects don’t happen. If that is the case, it is unfortunate, but I believe we can put those resources toward other opportunities in the community.”
