Trafigura, a market leader in the global commodities industry,  announces that its wholly-owned subsidiary, MorGen Energy, has approved the final investment decision to begin construction of a 20MW green hydrogen production facility in Milford Haven, Wales. The West Wales Hydrogen project is among the first projects supported by the UK Government’s flagship hydrogen allocation round to achieve FID.

With construction expected to begin in 2026 and commissioning by early 2028, the West Wales Hydrogen plant is set to produce approximately 2,000 tonnes per annum of low-carbon hydrogen, compliant with the UK’s Low Carbon Hydrogen Standard. The hydrogen will be used across a broad range of applications, including port decarbonisation, industrial heating, manufacturing and chemical feedstock.

Located on the site of a former oil refinery in the Celtic Freeport, the project is expected to support the creation of highly skilled jobs and engagement of local contractors throughout the construction phase. The facility has the capacity to scale in subsequent phases as demand evolves, and is positioned to become a future hydrogen hub, supporting industrial decarbonisation across south Wales.

MorGen has selected Sheffield-based ITM Power to supply the electrolyser system, supporting domestic manufacturing and the development of the UK hydrogen technology sector. Project financing for the West Wales Hydrogen production facility is being provided by Lloyds and Societe Generale.

Richard Holtum, CEO of the Trafigura Group, commented: “The UK government’s hydrogen support framework was key to this project reaching final investment decision – demonstrating how public policy and private capital can work together to support the decarbonisation of hard-to-abate industries. The West Wales Hydrogen project reflects Trafigura’s ability to commercialise emerging commodity markets, connecting new supply with customers seeking reliable, low-carbon solutions.”

Werner Lieberherr, CEO of MorGen Energy, said: “Reaching FID on West Wales Hydrogen is a defining milestone for MorGen and the UK hydrogen sector. This project demonstrates that green hydrogen projects in the UK can be delivered as bankable infrastructure investments when strong industrial demand is combined with a clear and stable policy framework. We are grateful for the strong support of the UK Government, especially the Department for Energy Security and Net Zero, and our partners, and we look forward to beginning construction and delivering hydrogen to our customers from 2028.”

Minister for Energy, Michael Shanks said: “We are backing hydrogen because it is crucial in decarbonising industry, driving investment, boosting our energy security and creating hundreds of jobs in our industrial heartlands. This investment shows how Wales is embracing the clean energy transition, with one of the UK’s first commercial scale low-carbon hydrogen production plants creating new opportunities for local communities.”

Secretary of State for Wales, Jo Stevens, said: “Wales is at the forefront of the green energy revolution and it’s great to see the West Wales Hydrogen project amongst the first in the UK to reach this stage, with the support of the UK Government. This is a huge milestone in the delivery of the project, which will create jobs and help grow the Welsh economy.”

The West Wales Hydrogen project will deliver low-carbon hydrogen that fully complies with the UK’s Low Carbon Hydrogen Standard and is expected to achieve over 15,000 tonnes of CO2e emissions savings annually. It has secured 15 years of revenue support through the UK Government’s Hydrogen Production Business Model, and grant funding through the Net Zero Hydrogen Fund, under HAR1.