White hydrogen could solve the hydrogen industry’s financial challenges

Sep 05, 2024

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What is white hydrogen?

Like oil and gas, white hydrogen is naturally occurring. Generated by continuous geochemical reactions in hard rock, white hydrogen’s characteristics differ from hydrocarbon molecules in that they are small and light and more likely to escape cap rocks.

White hydrogen, unlike alternatives such as green or blue, which require inefficient conversion processes — it comes ready-made and at a much lower cost. With their exploration and development expertise, oil and gas companies are well-placed to become champions of this emerging low-carbon molecule.

Other types of Hydrogen:

Why is white hydrogen generating interest right now?

The world needs low-carbon hydrogen (hydrogen that is made in a way that creates little to no greenhouse gas emissions.) to decarbonize. Global low-carbon hydrogen demand is forecast to reach almost 200 Mtpa (million tonnes per annum) by 2050, with green hydrogen supply meeting the bulk of this future demand.

Green hydrogen’s production costs, though, remain stubbornly high, with a range as wide as US$6/kg to US$12/kg. This is driven by green hydrogen’s need for high availability of renewable power for electrolysis. It will also depend for years on substantial subsidies to work towards a commercial threshold in the range of US$3/kg.

White hydrogen offers a much cheaper alternative resource. Without the need for inefficient energy conversion or manufacturing processes, white hydrogen produced at scale from reservoirs sited close to end-user markets could be delivered well below US$1/kg. The co-existence of helium may also offer a valuable commercial lever for white hydrogen exploitation.

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