Until recently, the majors’ hydrogen plans have been modest, but many are now pursuing multimillion-dollar projects, often with government support, to redefine their future role in a world less reliant on fossil fuels while capitalising on the energy transition.
BP Plc is taking the lead in the $36 billion Asian Renewable Energy Hub, a project that aims to install 26GW of solar and wind farms over a 6,500 square kilometres stretch of Western Australia’s Pilbara region. Once fully developed, it will produce about 1.6 million tons of green hydrogen or 9 million tons of ammonia annually, which can be used to make fertiliser.
TotalEnergies SE has teamed up with Indian billionaire Gautam Adani’s conglomerate in a venture that has the ambition to invest as much as $50 billion over the next 10 years in green hydrogen. An initial investment of $5 billion will develop 4GW of wind and solar capacity, about half of which will feed electrolyzers producing hydrogen used to manufacture of ammonia. The venture has the potential to expand to 1 million tons of annual green hydrogen production by 2030, driven by 30GW of clean power.
Most recently, Shell Plc has also acquired 35% stake in the Green Energy Oman (GEO) project that envisages the production of green hydrogen from 25GW of solar and wind power. The goal is to produce 1.8 million tonnes of green hydrogen and up to 10 million tonnes of green ammonia per year.
Analysts, environmentalists and big power companies say the world needs green hydrogen to meet the goals of the international Paris agreement. While giant projects are on the rise, there's a long way to go before they are proved to be commercially viable. Current obstacles include risks around logistics, technology and supply chain. However, as costs of natural gas, gasoline and diesel raise concerns over energy security, prospects for green hydrogen will continue to grow.