June 28, 2021 • Paul Rodden • Season: 2021 • Episode: 24
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In episode 024, What if we could drill for hydrogen like we drill for natural gas and oil? Today I'm going to talk about natural hydrogen, what it is, who's drilling for it and who's investing in it. All of this on today's hydrogen podcast.
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What if we could drill for hydrogen like we drill for natural gas and oil? Today I'm going to talk about natural hydrogen, what it is, who's drilling for it and who's investing in it. All of this on today's hydrogen podcast.
So the big questions in the energy industry today are, how is hydrogen the primary driving force behind the evolution of energy? Where is capital being deployed for hydrogen projects globally? And where are the best investment opportunities for early adopters recognize the importance of hydrogen? I will address the critical issues and give you the information you need to deploy capital. Those are the questions that will unlock the potential of hydrogen. And this podcast will give you the answers. My name is Paul Rodden, and welcome to the hydrogen podcast.
Okay, so let's imagine for a minute that you're a driller, and you're drilling for a well, and you pull the drill bit out and out comes gas, but it's not the gas that you think and you get it analyzed and it turns out that it's natural, molecular hydrogen. Okay, so how is this possible? Well, this is hydrogen that is being generated by geological processes. And an article by renewablematter.edu explains this very well.
So where does the hydrogen originate? Well, what is becoming clear with time is that several phenomena lead to a continuous generation of hydrogen in the Earth's crust, a water rock interaction, known as diagenesis releases hydrogen from water during oxidation phenomena that can be observed in different geological contexts. As soon as there is for example, ferrous ion in contact with water, it oxidizes to ferric iron and releases hydrogen. The same reaction can also take place with other metals, such as magnesium and is fast and efficient at high temperatures around 300 degrees Celsius, but also possible at lower temperatures.
Other sources of natural hydrogen are known. Another production pathway is radiolysis, by which hydrogen contained in water is separated from oxygen by the natural radioactivity of the Earth's crust. Other sources such as friction on the fall plains, and the activity of certain bacteria, also released hydrogen. But what is important to note is that in all of these cases, it is a flow of hydrogen and not an accumulated fossil resource. At the same time, the preservation of large quantities of primordial hydrogen, which is the hydrogen present at the initiation of the solar system in the mantle, or even the earth's core during the formation of the Earth is also a working hypothesis explored by some researchers. Okay, so who's drilling for this stuff? Well, the first company I'd like to highlight is Natural Hydrogen Energy, LLC. The company is based out of Denver, Colorado, and has successfully drilled their first exploratory well in 2019.
The second company I'd like to highlight is Helios, and more specifically, their Aragon project in Spain. Now this project comprises a plan to explore and drill for natural hydrogen and helium in two permits the Barbastro and the Monzon, covering a land area of 89,536 Hector's in Aragon, Spain. The concept relies upon the results from an old exploration well drilled in the early 1960 in one of the permits. This well encountered a very high total gas shows, with accompanying lost circulation at a depth of 3600 meters, which are analyzed to determine at the time to be pure hydrogen. The two permits were granted to Helios Aragon in June 1 of 2020 for a six year term. Existing studies into natural or gold hydrogen, are scarce as it was previously thought that hydrogen could not accumulate in nature.
But now we know this is not the case, providing that a good seal cap rock exists, upward migration of lightweight elements such as hydrogen and helium can be prevented and an accumulation can develop over geologic time. The geological and geophysical data that Helios has acquired in the permits supports the presence of an excellent salt cap rock, and this has led to their technical team to be extremely excited about the potential for commercial accumulation of hydrogen and helium in the permits. The EU predicts a seven fold increase in hydrogen demand, and currently Spain consumes 500,000 tonnes of hydrogen per year, according to a hydrogen production industry valued at 1.2 5 billion euros. The Helios Aragon vision looks to produce competitively priced natural gold hydrogen and associated helium, which can be utilized locally or distributed throughout Spain in Europe. This would be accompanying with the European hydrogen backbone plan.
If successful, their goal of establishing a hydrogen hub which can ultimately be used for the storage of locally manufactured green hydrogen will go a long way in solidifying Spain as a hydrogen leader in Europe. And who's investing in this? Well, it's the same fund that's backing Hyzon Motors, and Raven Sr... the Ascent Hydrogen Fund. And according to David Wu, the president of the ascent funds management team, since global mandate is to look for champions across the hydrogen value chain, from hydrogen production, hydrogen logistics, and hydrogen applications, following our investment into Hyzon Motors, a champion in the hydrogen mobility sector, we're excited to now be working with Helios, one of the very few companies around the world who have the real technical understanding and execution ability to develop gold hydrogen.
Okay, so another great source for hydrogen for the future of our energy needs. And two great takeaways about this natural native gold hydrogen, whatever you want to call it, is its estimated price point. And what makes that great is that we can use current technologies, current drilling technologies, to explore drill and produce natural renewable hydrogen. And what I'm hoping to see in the next few years, is oil and gas companies further investing into the E&P of natural hydrogen. But it seems to me that this would be a very easy transition for that industry, especially given that the estimated price point for producing this could be as low or lower than gray hydrogen.
In other words, getting the price point down below that holy grail of $2 per kilogram. Okay, that's it for me, everyone. I hope you've enjoyed this brief introduction into gold or native or natural hydrogen, however you want to call it. If you have any questions or comments about today's podcast, come on and stop by my website at thehydrogenpodcast.com, and let me know. And as always, take care. Stay safe. I'll talk to you later.
Hey, this is Paul. I hope you liked this podcast. If you did want to hear more. I'd appreciate it if you would either subscribe to this channel on YouTube, or connect with your favorite platform through my website at www.thehydrogenpodcast.com. Thanks for listening. I very much appreciate it. Have a great day.