BP chief executive Bernard Looney is confident hydrogen will become a “material” part of the UK supermajor's future business — only not before the 2030s.
Looney told analysts on a call to discuss the company’s third-quarter results on Tuesday: “We believe in hydrogen.”
“Hydrogen is a business that will materialise for BP probably in the 2030-plus timeframe, not in the here-and-now timeframe,” said Looney.
'Potential to become material'
“I think [it has] the potential to become material in the period after 2030.”
Heavy industry and power, as well as heavy-duty transport, are expected to be the main areas of focus for BP’s future hydrogen business, he added.
He also predicted it will comprise a mix of blue hydrogen — produced from natural gas with carbon capture and storage — and green hydrogen — which is generated using renewable energy and water electrolysis.
“We believe the world needs a hydrogen economy to get going. And the best way to do that is to give it the best possible start and green and blue are ways to do that,” he said.
Looney also hinted further announcements could be due soon.
“You should expect to see a bit more from us in the coming months and certainly as we head into 2021,” he said.
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'Incredible example'
Looney also said he was hopeful the proposed Net Zero Teesside (NZT) industrial decarbonisation scheme BP is leading in north-east England would be an “incredible example of revitalisation” for the area around Middlesbrough on the River Tees where it is located.
The NZT proposals include a new gas-fired power station with carbon capture and to extend the CCS infrastructure to neighbouring industrial users.
“I would expect to see us reaching some milestones on that project early next year,” Looney added.
“You could see it up and running towards the middle to the second half of the decade.”
Looney said BP is working with the UK government to put in place the regulations and the fiscal certainty “that we need to be able to make those investments”.
The NZT project anticipates further definition on the commercial business models in line with the business model consultation on CCS published earlier this year by the UK Department of Business, Energy & Industrial Strategy.
The UK’s long-awaited energy white paper setting out in detail how the nation plans to become a carbon-neutral economy by the middle of the century will also be published this autumn, Energy Minister Kwasi Kwarteng said in September.
On Monday, BP announced that it was leading a group of Europe’s biggest oil and gas and energy companies to apply for UK government funding to kick-start the development of pipelines and infrastructure intended to store carbon dioxide captured from NZT and the Zero Carbon Humber (ZCH) project, another decabonsiation scheme further south around the Humber estuary.
The Northern Endurance Partnership (NEP) — also comprising Eni, Equinor, Shell, Total and National Grid — is aiming to develop a network of offshore pipelines to transport CO2 emissions captured from NZT and ZCH and to pump them into saline aquifers beneath the UK North Sea for permanent storage.
BP, with other firms, is also exploring the construction of Germany’s first network connecting producers of green hydrogen with industrial customers near Lingen in Lower Saxony, Germany.
