December 30, 2021 • Paul Rodden • Season: 2021 • Episode: 77
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In episode 077, A new hydrogen player enters into the Permian Basin. Woodside in Australia looks to the feasibility of a liquid hydrogen supply chain. And as a follow up to my last podcast on hydrogen blending regarding a pilot program in Long Island to mix hydrogen with renewable natural gas for 800 homes. All of this on today's hydrogen podcast.
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A new hydrogen player enters into the Permian Basin. Woodside in Australia looks to the feasibility of a liquid hydrogen supply chain. And as a follow up to my last podcast on hydrogen blending regarding a pilot program in Long Island to mix hydrogen with renewable natural gas for 800 homes. 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.
In a press release on December 17, Proteum Energy, and Istmo Energy signed MOU for production of low cost clean hydrogen in the Permian Basin. Proteum energy LLC entered a binding a Memorandum of Understanding today with Istmo energy LLC, headquartered in Fort Worth, Texas, to negotiate terms by which Proteum energy will provide low cost low carbon intensity hydrogen to Istmo for production of ultra low sulfur diesel and clean hydrogen for delivery to offtake customers in the Permian Basin, Mexico and California markets.
According to Alex Gutierrez, Principal and Co-Founder of Istmo Energy,Istmo Energy is pleased to have the option to leverage our on site DF analyzers to produce hydrogen from ethane for our hydrotreaters, while at the same time offer additional clean hydrogen sales in the Permian region. And in a quote from Proteum’s CEO, Laurence B. Tree II Proteum energy is extremely pleased to be working with a strong partner like Itsmo energy providing innovative low emission fueling solutions. Now, specifications for the project are still in the planning stages and the parties plan to commence project construction in q3 of 2022. Okay, so not a lot of detail on this deal, but it is interesting to see that hydrogen can be used on site in the basin for hydro treating. Now for those of you who don't know what a hydro treater is a hydro treater primarily removes sulfur and other contaminants from intermediate streams before it gets blended into a finish or refined product. And how it does this is that it mixes the hydrocarbon with hydrogen and then it's heated up to around 500 to 750 degrees.
And in doing this, the hydrogen reacts with the hydrocarbon and it removes the sulfur and it removes the nitrogen which creates ammonia. And hydrogen also saturates the olefins and aromatics in this process. So you might look at this as a legacy use of hydrogen. But what's interesting about this deal is that they're looking at other applications of the hydrogen besides the hydro treaters, and that's even trucking it or transporting it by some other method, perhaps pipeline to California and Mexico. And Mexico, I believe could be a very big up and coming player and a hydrogen market and I look forward to seeing how this deal fleshes out. Next, in a press release on December 22. Woodside Keppel data centers City Energy Osaka gas Singapore and city OG gas energy services to study the feasibility of a liquid hydrogen supply chain setting the potential impact of lowering carbon emissions in cities. So Woodside Energy limited Keppel data centers holding pte limited City Energy PT limited of Osaka gas Singapore pte.
Limited and city OG gas services Pvt Ltd. have signed a memorandum of understanding to study the feasibility of a long term stable supply chain of sustainable liquid hydrogen from Western Australia to Singapore and then potentially to Japan. A new agreement follows the announcement of the proposed h2 Perth hydrogen facility in Kwinana, where Woodside will seek to establish a large scale liquid hydrogen and ammonia export hub. The study is expected to continue until mid 2022, at which juncture the parties will decide the next phase of their collaboration. The parties will work collaboratively to explore both the technical and commercial aspects of developing a liquid hydrogen supply chain between Western Australia and Singapore and potentially Japan through collaboration using their respective expertise and knowledge.
This is an exciting development which supports the Singapore green plan, which starts ambitious and concrete targets over the next 10 years, strengthening Singapore's commitments under the UN's 2030 sustainable development agenda and Paris Agreement and positioning Singapore to achieve its long term net zero emissions aspirations as soon as viable. Woodside CEO Meg O’Neill said the MOU was aligned with Woodside strategy to develop a diversified and scalable portfolio of new energy products to help reduce customers emissions. She states that it is important for us to work collaboratively with potential customers and end users such as Keppel data centers Osaka Gas Singapore City Energy and city OG gas energy services to collaboratively build out a sustainable hydrogen supply chain from our proposed h2 Perth project. She continues saying h2 Perth is ideally located in Western Australia for shipping to Singapore and Japan.
And the project site is close to existing power gas, water and port infrastructure as well as a skilled local Residential workforce. The CEO of capital data centers says this MOU will explore the feasibility of harnessing liquid hydrogen from Australia to power our data centers in Singapore with potential applications for other Keppel business units in the future. This collaboration of the upstream liquid hydrogen supply chain complements the existing MOU's. We have entered with various partners to explore the mid to downstream segments, including transportation storage and regasification. He continues saying in line with Keppel's vision 2030 and carbon emission reduction targets. We are committed to the decarbonisation of data center operations through our research efforts in LNG and hydrogen for power generation, floating data centers and technologies for carbon capture utilization and sequestration. For pipe down gas provider city energy, which is the National producer and retailer of town gas and Singapore, this collaboration may significantly support its carbon reduction effort in pipe town gas production, or combustion. So this is quite the bold announcement from Woodside because it's not easy to get hydrogen into a liquid state, which means cooling it to negative 253 degrees Celsius.
But that being said, if they can find a way to do it economically, that's a big deal. And the fact that they're not looking at just one place Singapore, but also looking to continue this into Japan. Now that being said, I think liquid ammonia is probably the better choice for distributing hydrogen to these areas. It's just more cost effective. But like I said, if Woodside I can do this economically with liquid hydrogen, then that would be the best case scenario. And lastly, in a follow up to my last podcast about hydrogen blending. In an article from Bloomberg, Josyana Joshua writes, can green hydrogen clean up natural gas.
A pilot program in Long Island will mix hydrogen produced from renewable power with natural gas, heat about 800 homes and a fleet of town vehicles. In early December, lawmakers in New York City passed a bill banning natural gas hookups in all new buildings becoming the largest US city to enact measures restricting buildings from installing gas fueled stoves, furnaces and water heating systems in new construction. The ban which is set to take effect in 2023. For buildings under seven stories join similar regulations in Berkeley and Seattle. They're part of a movement to electrify everything as a means to bring down carbon emissions from energy use in buildings. But even as New York City signaled its intentions to move away from hydrocarbons, National Grid, a local utility that opposes city ban committed to making its existing natural gas infrastructure cleaner and greener. On December 15, National Grid and the Long Island town of Hempstead announced the HyGrid Project, a program to blend zero emission green hydrogen into the natural gas distribution system to heat about 800 homes and fuel at least 10 municipal vehicles.
In a quote from Rudolph Wynter, president of National Grid New York, we believe that hydrogen can transform the energy industry and we are on the forefront. This exciting project shows that hydrogen blending can be used to decarbonize the existing networks. Hempsteads existing wind and solar Generating Equipment produces the hydrogen, which will be blended with a conventional natural gas gradually over the next three years, starting with 5% this year, and then increasing incrementally to finally reach 20%. Wynter said at higher concentrations, hydrogen could damage natural gas pipelines and appliances that use it.
This natural gas hydrogen blend can be used in standard home appliances such as furnaces, stoves, and clothes dryers. About 60% of the US homes rely on gas heating, including three and five houses in New York State. This is according to the US Energy Information Administration. Although HyGrid is just a pilot project right now, national grid, which operates in New York, Rhode Island, Massachusetts, is looking to expand the availability of the hybrid fuel more broadly. Utility is also partnering with Stony Brook University, the New York State Energy Research and Development Authority and the Low Carbon resources initiative to research decarbonisation. The Hemstead pilot is one of the first hydrogen blend projects in the US to go into homes. National Grid UK has been doing similar projects in Scotland, and an Australian Gas Company began powering homes with a 5% green hydrogen blend in May. Hydrogen blending pilots have also emerged in California and Colorado. Some environmental advocates are less sold on the promise of mixing green hydrogen with natural gas, fearing such efforts offer only limited decarbonisation benefits and could only delay the electrification process. Peter Iwanowicz the executive director of environmental advocates in New York said hydrogen projects like this could be exploring a dead end. The state is drafting a Climate Action Plan that promises to decommission its natural gas infrastructure.
New York State made a bold decision almost two years ago to stop combusting fuels for energy power systems. So whether it's green hydrogen or natural gas in the short term, all the stuff we know is going to be facing decommissioning Arvind Ravikumar, a research associate professor in the petroleum and Geosystems Engineering Department at the University of Texas at Austin said pilot projects such as national grids are useful for understanding how best to utilize hydrogen as a fuel. When burned, hydrogen emits only water vapor being an appealing alternative to hydrocarbons in power intensive industries like steelmaking and freight trucking that have proven harder to electrify. But research on the benefits or disadvantages of hydrogen and the role it could play in the energy transition is still lacking. He says that we cannot say this project is a greenhouse gas emission reduction program. But this is an important research project to help us better understand how the hydrogen economy could play out and how to solve the technical challenges within the hydrogen ecosystem. Now for the consumers who use the hydrogen gas in Hempstead participation in the program requires no modifications to their appliances, and will come at no extra cost. Something Wynter said was most important to him when thinking of the energy transition. Antony Green, National Grid UK hydrogen project director told greentech media in October of 2020 that users weren't able to tell a difference between the 20% Hydrogen blend and regular natural gas Wynter continues by saying we have to have an energy transition where people can afford the energy at the end of the day. A great way of doing this is how do you utilize the existing networks.
But decarbonizing That, to us, hydrogen has always been a way of decarbonizing the existing networks to provide a low carbon fuel that also puts us on track to make sure that it's equitable and affordable. Okay, so a great article from Bloomberg and a really good look at a new hydrogen blending project in the US one that looks to mirror very closely it seems the project in the UK, but it's also projects like these, what it means to actually go through an energy transition that this is the path forward towards decarbonisation, not just shutting off all hydrocarbon use right now.
Alright, that's it for me everyone. You have any questions, comments or concerns about today's episode, come and visit me at my website at thehydrogenpodcast.com. Or you can always email me at firstname.lastname@example.org. I would really love to hear from you. And as always, take care. Stay safe. I'll talk to you later.
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