If the plant goes ahead it would feed into the Gladstone Hydrogen Ecosystem, a collaborative investigation into domestic offtake and transport uses for hydrogen which would potentially evolve into large scale exports.

The Yarwun plant is a major user of coal fired power and uses gas for processing. If the pilot plant went ahead it could cut emissions by about 50 per cent.

The two corporations have signed a letter of intent that focuses on Yarwun as the location for a Gladstone hydrogen plant that Sumitomo has been studying.

Rio Tinto previously joined forces with the Australian Renewable Energy Agency  to study whether hydrogen can replace natural gas in alumina refineries to reduce emissions. Part of that deal was a $1.2 million feasibility study into using hydrogen as a gas replacement in processing.

Rio Tinto Australia chief executive Kellie Parker said he project could lead to Sumitomo supplying industry more broadly in Gladstone.

“Reducing the carbon intensity of our alumina production will be key to meeting our 2030 and 2050 climate targets. There is clearly more work to be done, but partnerships and projects like this are an important part of helping us get there,” Parker said.

Sumitomo Corporation’s energy innovation initiative director Hajime Mori said the company had a vision of achieving carbon neutrality by 2050.

“We believe the pilot plant will play a significant role in establishing the Gladstone Hydrogen Ecosystem,’’ he said.

“Sumitomo has commenced the design study and preliminary master planning to build the Gladstone hydrogen ecosystem and we will continue to work towards future hydrogen exports from Gladstone.

Deputy Premier and Minister for State Development Steven Miles said the partnership was only the beginning of what the Government expected would be a wave of international collaborations leading to new industries.