A group of companies involved in a proposed green hydrogen project in western Newfoundland is facing financial instability after the provincial government’s decision to reclaim Crown land. This move has prompted the consortium, known as WEGH2 Group, to file for creditor protection, jeopardizing the future of their initiative.
The project, spearheaded by World Energy GH2 and supported by prominent figure John Risley, aimed to advance a wind-powered hydrogen energy sector in Newfoundland and Labrador. However, court filings reveal that the venture is burdened with significant debt and the looming risk of losing its land reserves to the government.
According to an affidavit from Richard Hugh, the CEO of the consortium, the company is currently in a critical financial situation with limited access to credit and unsustainable operations. The group, comprising interconnected companies with diverse debts and creditors, is reportedly facing total liabilities of approximately $100 million while holding assets valued at around $29.2 million.
Among its outstanding debts, WEGH2 Group owes Export Development Canada about $50 million and has outstanding shareholder loans totaling approximately $15 million. Additionally, the consortium owes the Newfoundland and Labrador government about $10.5 million in land reserve fees for the Crown land allocated for their project.
The province had earmarked 1,080 square kilometers of Crown land for the wind-powered hydrogen and ammonia venture, which received environmental approval in 2024. The government was charging a monthly fee of approximately $390,000 to maintain the land allocations.
Energy Minister Lloyd Parrott recently announced that the province would not extend land holdings for companies that were delinquent in their fees. Despite attempting to negotiate a repayment plan with the government, WEGH2 Group failed to reach an agreement and is now under pressure to settle the outstanding fees by the end of 2026, per a letter from the government.
Richard Hugh emphasized the critical importance of retaining the Crown land reservations for the project’s viability, as substantial investments exceeding $120 million have already been made. The consortium aims to restructure its debts and salvage the initiative.
The case is scheduled to return to the Supreme Court on March 9. World Energy GH2, partially owned by Risley’s company, CFFI Ventures, is also seeking court approval for debt management in Nova Scotia. Risley referred inquiries to Hugh, who was unavailable for immediate comment. The Newfoundland and Labrador government did not respond immediately to requests for comment.