By Michael Pineda
mpineda@cherryroad.com
What was expected has now become official.
Woodside is walking away from the H2OK project.
The decision was made during the Australian company’s Second Quarter Report, which was released last week. In regard the proposed hydrogen plant in Ardmore, the company listed the reasons for exiting the project as ongoing challenges facing the lower-carbon hydrogen industry, including escalating costs and the lower than anticipated hydrogen demand.
The company also reported exiting the project would result in an impairment loss of approximately $140 million pre-tax (approximately $110 million post-tax).
“Woodside Energy made the decision to formally exit the proposed H2OK project in Ardmore, Oklahoma due to ongoing challenges facing the lower carbon hydrogen industry, including cost escalation and lower than anticipated demand,” a Woodside spokesperson said.
“We would like to extend our many thanks to Ardmore and the State of Oklahoma for their support and patience – it has been invaluable.”
Ardmore Development Authority President & CEO Bill Murphy said he was disappointed Woodside Energy was exiting the project. The caveat was that he appreciated the relationship that had built up over the years, describing the organization as a model economic development partner that developed relationships at the local and state level.
“They did everything right, but there were factors beyond our control that made the project untenable for them,” Murphy said.
The reliance on Federal incentives to get the project off the ground hit a wall with the priorities of the change in the administration. Murphy said without support, this industry was never going to get off the ground and that is what happened.
“With that being said, we are currently working with them on unwinding the project,” Murphy said. “That allows us reacquire the land that we sold them.”
Murphy said the land, a total of 94 acres, can be used for other projects. In fact, Murphy said he received a call Monday from an individual in the energy industry that is looking for opportunities in this part of Oklahoma. Murphy said the individual was not associated with green energy.
“We have to look for opportunities that better align with this administration’s priorities,” he said.
Woodside’s decision comes months after it no longer had a date set to make a final investment decision. Prior to that announcement, Woodside had changed the date several times awaiting final guidance from the federal government on incentives.
“While it is naturally disappointing that the proposed H2OK project will not come to fruition, it is evident that demand and support at the national level were not in place for Woodside to move forward,” Sen. Jerry Alvord said.
“This decision in no way diminishes Ardmore’s favorable position to attract new business and industry. There is an experienced workforce in place and the 2026 Economic Vision Plan is complete, providing a roadmap for Ardmore’s future. I, along with my fellow legislators, look forward to working with the ADA and City of Ardmore to provide good paying jobs for area residents.”
The project, had it come to fruition, was expected to produce up to 60 tons of liquid hydrogen per day. The city would have been a beneficiary in franchise fees from OG&E remitted along with the sale of gray water. Woodside has been reimbursing the city for the cost of an engineering study for a pipeline from the wastewater treatment plant to the location of the proposed facility at Westport Industrial Park.
“Of course, we are very disappointed that Woodside will not be coming to Ardmore, it is more of a lack of federal support, that that of the state and Ardmore,” State Rep. Tammy Townley said.
“We still have some great things under development. We will still be able to move forward with some different entities, and we are excited about the future.”
The project was first announced in 2021. A fact sheet from Woodside indicated Ardmore was cited as an ideal location for the project due to its proximity to the national highways. It was also located near the supply chain infrastructure of major transport companies as Woodside sought to supply those companies with hydrogen.
“While this news is disappointing for those who supported the Woodside H2OK Project in Ardmore, it was predictable and was not surprising given the lack or consistent federal policy supporting Hydrogen markets,” former Oklahoma Energy of Secretary Ken Wagner said. “About two years ago, there was a sense that the markets for hydrogen in the U.S. were not developing as was first predicted after the passage of the IIJA and IRA bills. This was, in large part, a failure of federal policy to prioritize the use of hydrogen. Then the new administration made an even greater policy shift by removing certain tax incentives to support a growing hydrogen economy.”
