The high cost of fossil fuels is making green hydrogen a better bet than the “blue” variety produced from natural gas, Shell CEO Ben van Beurden admitted last week.
The current high cost of deriving hydrogen from methane gas, then storing most of the carbon dioxide emissions that result, makes the whole venture “a little bit difficult,” van Beurden conceded during a call with analysts to discuss his company’s massive second-quarter profits.
“I think for some while Europe will focus very much on making green hydrogen,” he said, in remarks reported by Recharge News. “And maybe over time, indeed, we’ll also look at importing hydrogen—which can then be also blue hydrogen, for instance, if it comes out of gas-rich countries.”
Over the long run, van Beurden said Shell will be interested in the value of hydrogen in a transportation system that has yet to be built. He added that that work, in turn, “will be driven by how competitive hydrogen becomes against middle distillates—such as diesel, jet fuels, and heating oil—and how fast transportation companies or their customers want to decarbonize,” Recharge News writes.
“We believe there’s a tremendous potential there and, of course, also a tremendous driver from governments to make these things happen,” the Shell CEO said. “And that I think is much more [the] determinant for how the hydrogen business will develop in Europe than what might happen with natural gas.”
Recharge News says Shell recently confirmed its investment in a 200-megawatt green hydrogen project at the Port of Rotterdam in the Netherlands. Its output will be used to power the company’s oil refinery at the port.
“The 60 tonnes of hydrogen produced each day will be transported about 40 kilometres via pipeline to the company’s oil refinery at the Shell Energy and Chemicals Park Rotterdam, where it will replace some of the grey hydrogen used to remove sulphur from crude oil, although some of the supply might also be used to power hydrogen trucks,” the news story states.