The global demand for low-carbon hydrogen is expected to skyrocket in the coming decades as the world works to decarbonize. While green hydrogen has been the focus, its high production costs and reliance on renewable energy pose challenges. Enter white hydrogen – a naturally occurring, low-cost alternative that could disrupt the hydrogen market. In this article, we answer five critical questions about white hydrogen and its potential.
What is White Hydrogen?
White hydrogen is a naturally occurring form of hydrogen generated by continuous geochemical reactions in hard rock formations. Unlike green or blue hydrogen, which require energy-intensive conversion processes, it is ready-made and significantly cheaper to produce. However, more research and practical field experience are needed to fully understand the key components of a hydrogen play.
Why is White Hydrogen Generating Buzz?
The world needs low-carbon hydrogen to meet its decarbonization goals. It is attracting attention for several reasons:
- Wood Mackenzie forecasts global low-carbon hydrogen demand to reach nearly 200 Mtpa by 2050, up from just 1 Mtpa today.
- Green hydrogen, the current frontrunner, has production costs ranging from $6/kg to $12/kg and will rely on subsidies for years to reach commercial viability.
- In contrast, white hydrogen produced at scale near end-user markets could be delivered for under $1/kg without the need for inefficient energy conversion.
- The potential co-existence of helium also offers a valuable commercial opportunity.
How Significant Could White Hydrogen Become?
While white hydrogen is not a silver bullet for the energy transition, it could play a meaningful role. Wood Mackenzie estimates that alternative forms of low-carbon hydrogen, including white hydrogen, could supply up to 17 Mtpa by 2050. Capturing subsidy support similar to green hydrogen would significantly boost white hydrogen infrastructure and displace some higher-cost production.
Who is Leading the Way in White Hydrogen Development?
The white hydrogen industry is in its infancy, with a handful of innovators backed by private investment leading the charge. To date, the only operational white hydrogen project is the Bourakébougou field in Mali, which powers a small village.
Some countries are paving the way for white hydrogen development by amending mining and petroleum codes. France has modified its mining code to recognize white hydrogen, while several Australian regional governments have added it to their list of regulated substances.
The Role of Oil and Gas Companies
Oil and gas companies are uniquely positioned to unlock the potential of this hydrogen with their subsurface expertise, capital, and infrastructure. Governments could enable exploration opportunities for these companies through block licensing, fiscal terms, and incentives, mirroring the oil and gas industry.
It could become part of the future low-carbon portfolio for some oil and gas companies, alongside biomethane, e-methane, blue and green hydrogen. While still unproven, it has the potential to displace some blue and green hydrogen developments with the right combination of technology, capital, and regulation.
It offers an intriguing opportunity as a low-cost, low-carbon energy source. As global hydrogen demand grows, this naturally occurring resource could play a significant role in decarbonization efforts. Oil and gas companies, with their expertise and resources, are well-positioned to lead the way in developing this promising new industry.
Key Takeaways
- White hydrogen is naturally occurring and could be produced at a fraction of the cost of green hydrogen
- Global low-carbon hydrogen demand is forecast to reach nearly 200 Mtpa by 2050
- It could supply up to 17 Mtpa by 2050 with the right regulatory support
- Oil and gas companies are uniquely positioned to unlock the potential
Read More: White Hydrogen: Transforming Mining’s Clean Energy Future
