On 2 January 2026, Iron Road Limited told the Australian Securities Exchange that Revera Energy — the private-equity-backed developer that had absorbed Amp Energy's green hydrogen ambitions on South Australia's Eyre Peninsula eight months earlier — had let a 24-hectare land option at Cape Hardy lapse. Call her Denise, a composite standing in for the grain growers and graziers who farm the mallee country around Cape Hardy and Port Spencer, one of the state's three proposed hydrogen export sites: she had watched survey crews pass through since 2021, when Amp Energy first floated a staged precinct there that it said could eventually reach 10 gigawatts of electrolyser capacity, backed by options over 604 hectares and a non-refundable $2.5 million deposit Revera paid in August 2024. Two months later, on 31 March 2026, a second option lapsed too — 111 hectares released back for the cost of a missed deadline, not a signed contract. Only the smallest parcel remains under option, now earmarked not for an export precinct but for a much smaller domestic use — feedstock pellets for green iron, not hydrogen bound for a ship. Two hundred kilometres up the coast at Port Bonython, near Whyalla, the government was still describing South Australia's hydrogen export ambitions as being on track.
What the government did
South Australia's hydrogen ambition predates the Malinauskas government and, until recently, was genuinely bipartisan. The Marshall Liberal government released the state's Hydrogen Action Plan in September 2019, and followed it in October 2020 with the South Australian Hydrogen Export Prospectus, which named three candidate export hub sites: Port Bonython near Whyalla, Cape Hardy/Port Spencer on the Eyre Peninsula, and Port Adelaide (Government of South Australia, Hydrogen Action Plan, Sep-2019; Hydrogen Export Prospectus, Oct-2020). Peter Malinauskas's government, elected in March 2022, inherited that trajectory and added two things to it that are separate from — and have survived — the collapse of the government-owned Hydrogen Jobs Plan at Whyalla in February 2025. First, the Hydrogen and Renewable Energy Act 2023, passed 16 November 2023, created the nation's first "one window to government" licensing regime for large-scale hydrogen and renewable energy projects, folding land access, environmental assessment and native title considerations into a single approval process. Second, and larger in dollar terms, the Port Bonython Hydrogen Hub: master planning with developers began in April 2023, and in October 2023 the Commonwealth and South Australian governments finalised a matched-funding grant agreement — $70 million from the Commonwealth's Regional Hydrogen Hubs Program and $30 million from the state, a combined $100 million for shared "common-user" infrastructure including a jetty refurbishment (the state's own commitment, around $32.7 million, approx., to extend the existing Port Bonython jetty's working life by 40 years), transmission and water supply, with a further $40 million (approx.) expected from developers.
On 27 February 2024 the government signed Development Agreements with five companies — Origin Energy, Fortescue, Amp Energy (its South Australian assets since transferred to Revera Energy), The Hydrogen Utility (H2U) and Santos — each giving a pathway to a long-term Crown lease at Port Bonython once feasibility and design work are complete (Premier of South Australia, media release, 27-Feb-2024). The government's own projections describe a hub hosting "up to" $13 billion in private hydrogen and ammonia investment, drawing on as much as 6.5 gigawatts of new renewable generation to feed roughly 2.5 gigawatts of electrolyser capacity, and generating "as much as" 1.8 million tonnes of hydrogen a year by 2030 (all approx., Dept for Energy and Mining, Port Bonython Hydrogen Hub project materials). This is separate money and machinery from the $593 million Hydrogen Jobs Plan cancelled at Whyalla — that story is told elsewhere on this site. Port Bonython survived that decision, and the government says it remains fully committed to it.
The strongest case
A smarter bet than Whyalla, built on real advantages and someone else's risk capital
Judged on structure rather than slogans, Port Bonython is a materially different bet from the one that went wrong at Whyalla. South Australia's wind and solar resource is real and independently verified, and the site itself is not a greenfield gamble: it reuses a deep-water jetty that has served Santos's Cooper Basin liquids plant since the 1980s, cutting the capital a developer needs before producing a single tonne. More importantly, the government has changed its own risk model since the Hydrogen Jobs Plan collapsed. At Whyalla, the state itself owned and tried to build a single electrolyser and power station through the Office of Hydrogen Power SA, and wore the loss when the project's rationale disappeared. At Port Bonython, public money funds shared infrastructure — the jetty, transmission, water — that retains value regardless of which, if any, individual developer succeeds, while the $40 million developer contribution and the billions of private capital the government hopes to attract are, on paper, private money assuming private risk. For a small, GST-dependent economy leaning heavily on defence shipbuilding, agriculture and a handful of resource projects, even a partial, delayed hydrogen export industry would be genuine diversification — and the Hydrogen and Renewable Energy Act is durable, low-cost regulatory infrastructure that costs little to have written first, even if the industry it was written for arrives smaller or slower than advertised.
The evidence
Layer the record against that case and the picture thins quickly. Across the five companies that signed Port Bonython Development Agreements in February 2024, none has publicly announced a final investment decision as at mid-2026 (approx.); each remains, on its own public statements, at feasibility, pre-FEED or FEED-stage study. Santos's proposed Port Bonython Hydrogen Ecosystem, for instance, has completed pre-FEED and FEED engineering intended to "inform FID considerations" — language that describes a decision still to be made, not one that has been taken. The Department for Energy and Mining's own project page still describes the hub as being in "master planning" and "feasibility" more than three years after the site was first nominated.
That pattern is not a South Australian quirk; it is the shape of the whole industry in 2025 and 2026. The International Energy Agency's Global Hydrogen Review 2025 found that cancellations and delays had cut the achievable production capacity of announced global hydrogen projects by 2030 from 49 million tonnes a year, in its 2024 edition, to 37 million tonnes a year — a drop of roughly a quarter in twelve months, with electrolysis-based (green) hydrogen, the technology South Australia is betting on, accounting for more than 80% of the fall. In Australia, BP told its partners in July 2025 it would exit the 26-gigawatt Australian Renewable Energy Hub in Western Australia's Pilbara, one of the country's largest proposed green hydrogen projects; Fortescue — one of the five Port Bonython signatories — scrapped its PEM50 electrolyser project at Gladstone and its Arizona Hydrogen project the same month, taking a roughly US$150 million (approx.) write-down and closing a Gladstone factory it had opened less than a year earlier; and Origin Energy — another of the five — withdrew in October 2024 from the Hunter Valley Hydrogen Hub in New South Wales despite around $115 million (approx.) in committed government support, citing a market "developing more slowly than anticipated." Rystad Energy's hydrogen analysts estimated in 2025 that roughly a third of Australia's entire announced green hydrogen pipeline had by then been suspended or cancelled (approx., as reported).
South Australia's own back yard supplies the clearest local instance of the pattern. The Cape Hardy sequence set out above is not an isolated hiccup: it runs from the $2.5 million deposit in August 2024, through a missed deadline extended from 29 August to 31 December 2025, to two of the three original land options being allowed to lapse in January and March 2026 — and a public statement that the remaining, smallest parcel is now earmarked for direct-reduction iron pellets for domestic use, not an export terminal. A project once pitched at up to 10 gigawatts of export-scale electrolysis has become, on the developer's own account, a much smaller domestic feedstock proposal.
The critique
Three problems follow from that record, and none is answered by the steelman alone. First, the arithmetic does not hold together. The government's own aspiration for a single hub — up to 1.8 million tonnes of hydrogen a year by 2030 — is larger than the entire country's official stretch production target of 1.5 million tonnes under the Commonwealth's 2024 National Hydrogen Strategy, and more than three times the national base target of 0.5 million tonnes. Either South Australia expects to produce nearly all of Australia's hydrogen inside one regional hub within four years, or the Port Bonython figure is a ceiling of what could theoretically be built rather than a serious forecast. The government's materials do not say which, and the gap has not narrowed with time — it has widened, as the national numbers the industry can draw on have themselves been cut in successive IEA reviews.
Second, the offtake problem the government's messaging rarely volunteers is structural, not a matter of timing. Green hydrogen remains meaningfully more expensive to produce than the fossil-fuel-based hydrogen and ammonia it would need to displace, and — as energy researchers writing in The Conversation put it in 2025 — there is "little evidence buyers are willing to pay more for it." Steelmakers, refiners and shipping lines will not retool without assured, cheap, long-term supply; producers will not commit billions in capital without a buyer already under contract. Nothing in the public record for Port Bonython — Development Agreements granting a pathway to a lease, feasibility, pre-FEED and FEED work — resolves that standoff. A signed lease is not a signed sales contract, and as at mid-2026 the government has not published one for Port Bonython hydrogen at export scale.
Third, the institutional capacity built to chase this ambition thinned at exactly the moment the industry needed defending rather than managing down. The Office of Hydrogen Power SA, which had facilitated Port Bonython alongside the failed Whyalla plant, was dissolved on 7 May 2025 and its functions folded into the Department for Energy and Mining as one line item inside a much larger portfolio. The Energy Minister said at the time that Port Bonython would keep being pursued — and it has been, on paper — but a dedicated statutory office with its own chief executive and specialist staff is not the same thing as a generalist department managing hydrogen alongside coal transition, gas security and the rest of the energy brief, at precisely the point global capital was leaving the sector at the pace the IEA and Rystad have documented.
While the government spent $100 million preparing Port Bonython for an export industry with no signed buyer, the company chasing the same dream two hours down the coast was quietly handing its land back.
The risk to the future
Common-user infrastructure still needs someone else's capital to turn up
The Port Bonython model is more prudent than the Hydrogen Jobs Plan's, but it is not risk-free. The $100 million in jetty, transmission and water infrastructure is being committed regardless of whether any of the five Development Agreement partners ever reaches a final investment decision; if none does, or only a fraction of the promised $13 billion in private capital materialises, South Australia will own a refurbished but under-used industrial jetty rather than a functioning export industry — a smaller, quieter version of the sunk-cost problem the Auditor-General has already documented at Whyalla. The reputational risk compounds the financial one: having shown it will redirect hydrogen funding quickly when money is needed elsewhere, the government may find remaining partners — already warier after BP's, Fortescue's and Origin's retreats from comparable projects — reluctant to put risk capital in beside a government co-investor with that record. The deepest risk is that South Australia's broader post-carbon pitch — the Green Iron and Steel Strategy, the state's bid to help host COP31, its own "renewable energy superpower" branding — now rests on a commodity the government's own federal counterparts, and the global project data, say is arriving more slowly and at lower volumes than the figures South Australians have been given. No public document yet sets out what would trigger a reassessment of the Port Bonython bet on the same terms the Whyalla plant eventually got — before the money is spent, rather than after.