US oil producer ConocoPhillips and Japanese utility JERA plan to jointly develop a hydrogen gas project in the US.
Besides providing natural gas, ConocoPhillips will also manage a carbon capture and storage facility for the proposed gas project, reported Reuters.
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The agreement to supply gas for hydrogen, a clean fuel for electricity production, represents new opportunity for natural gas producers, reported the news agency.
Many firms, including Conoco, have entered long-term supply contracts with liquefied natural gas (LNG) developers that supply utilities.
A study to evaluate the hydrogen project’s feasibility could complete by the end of this year, according to JERA.
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The proposed facility will generate hydrogen from natural gas and convert it into exportable ammonia to sell in the US, Europe and Asia.
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By GlobalDataFurthermore the clean ammonia will also be supplied to JERA and Uniper under long term sale and purchase agreements.
JERA Americas chief executive Steven Winn said: “JERA and ConocoPhillips will be a low-cost ammonia supplier to domestic and international markets.”
The facility could become operational within five to eight years at a location along the US Gulf Coast.
A Conoco spokesman refused to discuss the firm’s role in the project and the scale of investment, reported the news agency.
The firm has outlined investments in multi-billion-dollar US and Qatari LNG projects.
It is also analysing a carbon capture facility for an LNG plant being developed by Sempra, a gas and power rovider.
JERA Americas, the US unit of JERA, said the company, Germany’s Uniper and ConocoPhillips target to initially generate 2 million tonnes of ammonia annually and then may expand to 8 mtpa.
Ammonia is usually used in the manufacturing of fertilizers and offers a low-carbon fuel that could be burned to generate power.
JERA is exploring many locations along the Gulf Coast for the hydrogen, ammonia and CCS facility.
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Image: The proposed facility will generate hydrogen from natural gas and convert it into exportable ammonia. Credit: Frauke Feind from Pixabay.
