Fortescue Metals Group (FMG), the iron-ore company owned by Australian billionaire Andrew Forrest, has set aside US$1bn of unallocated capital for its green hydrogen subsidiary Fortescue Future Industries (FFI) — which is likely to be at least partly spent on the unit’s planned investments in five renewable H2 projects in the coming year.

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FFI has a separate allocated budget of $730-830m in 2023 — $230m of which has been earmarked for capital spending this year, according to the latest financial results from FMG. The company gives 10% of its post-tax profits to FFI annually.

Analysts have speculated that the $1bn of unallocated capital will be used to fund the five green hydrogen projects that FFI has earmarked for final investment decision (FID) by the end of the year — and may actually be further topped up for that purpose.

But when asked directly whether the money will be spent in this way, in an investors’ call to discuss the company’s half-yearly results yesterday, Forrest ducked the question.

The firm has ballooned in size over the past year as a result of Forrest’s ambition to make the Australian mining spin-off a global behemoth in green hydrogen production.

But rumours are now circulating that the company is trimming down its planned projects list and could be about to cut jobs. Forrest appeared to implicitly confirm this during the call with analysts yesterday, saying that any jobs cuts would not be “wanton”.

It is worth noting that the profits of FMG on which FFI depends slumped 15% in the past six months according to yesterday’s results. This is mostly due to the falling price of iron ore, which has been hit by a slump in Chinese demand on the back of Beijing’s zero Covid policy, which has now been reversed.

Nevertheless Forrest and FFI chief executive Mark Hutchison continue to withhold key project costing data about the company’s bulging portfolio of international green hydrogen schemes — a policy recently criticised by investment bank Credit Suisse, which called on FMG’s shareholders to sell up unless the company could be transparent about FFI’s project costs.

Forrest has since picked a fight with the owner of a leading Western Australian newspaper that originally broke the Credit Suisse story, alleging — without giving hard evidence to back it up — that the reporting was biased and financially motivated.

Management secrecy around FFI’s projects also appears to extend to many of the company’s employees, who are, by Forrest’s account, in the dark about which of the company’s many proposals are in line to be chosen for FID in 2023.

“There are projects within each country which are competing to go for FID,” Forrest said. “If [Hutchinson] specifically names them, then the other projects are going to down tools, so that’s what we’re seeking to avoid. We want all projects working really hard. People love to compete within a family environment and that’s the only reason why we’re not specifically naming projects.”

Nevertheless Hutchinson told analysts that he is “certain” that the company will achieve FID on five projects by the end of the year as promised, hinting that the Gibson Island green ammonia project in Queensland is likely to be among them, along with projects in Texas, Norway and elsewhere in the US and Australia.

“We have a number of horses in the race,” he said, adding that the decision on the final five projects will depend on how the hydrogen markets develop over the year. The US, Asia and Europe will host key “hydrogen ecosystems” he explained, noting that the introduction of the Inflation Reduction Act in the US, as well as a final decision on the delegated act in the EU have both moved the needle already.

Both Hutchinson and Forrest are planning to visit China to better understand how FFI can reach that market.