India’s Reliance Industries has revealed a plan to repurpose its gasification assets at the world's largest refinery to become one of the world’s largest producers of blue hydrogen.
Reliance, which is owned by Indian billionaire Mukesh Ambani, revealed in a presentation this month that it planned to produce blue hydrogen at its Jamnagar oil refinery in Gujarat, India.
Reliance will use syngas, which is already produced at the refinery’s petroleum coke (petcoke) gasifiers, to make the blue hydrogen, with plans to implement a carbon capture and storage scheme to offset the emissions.
With an aggregate refining capacity of 68.2 million tonnes per annum, consultancy Rystad Energy said Jamnagar is the world’s largest oil refinery, noting it also has the capacity to produce 1.06 million tpa of hydrogen.
“Reliance’s plan would make this one of the most significant blue hydrogen projects globally,” Rystad analysts told Upstream, adding that other projects of a similar scale are the 1.5 million tpa H21 North of England scheme planned by Equinor, Cadent and North Gas Network, and Air Products’ 660,000 tpa Louisiana Clean Energy Complex in the US.
Blue H2 at a competitive cost?
Reliance believes it will be able to produce blue hydrogen at a “competitive cost” of between $1.2 and $1.5 per kilogram. However, Rystad notes the final cost will depend on a number of factors.
“CCS deployment has been highly dependent on carbon pricing in the other parts of the world, unlike India, where the carbon pricing mechanism is yet to be decided,” Rystad told Upstream.
“There are other factors to be accounted for, such as carbon dioxide concentration, which determines the energy required to capture CO2.
“We have seen trends of incorporating CCS to be expensive in existing plants due to extensive feasibility studies and risks involved with cost overruns in aged facilities.
“It is early to predict the cost of blue hydrogen at this facility in India now since it would depend on several factors.”
Reliance revealed in its presentation that hydrogen production from gasification provided a highly concentrated CO2 stream, which it said presented “a unique opportunity” to capture roughly 15 million tpa of CO2 at 30% of the “typical cost” of carbon capture.
However, it did not respond to Upstream’s requests for further details on the planned CCS scheme.
Rystad noted that, while the gasification of petcoke is one of the hard-to-abate sectors for emissions, the application of CCS has been highly effective with high-concentration syngas.
“Moreover, 15% to 20% of the operational and underdevelopment CCS deployment worldwide has been with large-scale oil refineries projects,” Rystad said.
“The CCS implementation on fossil-based hydrogen production could be a significant step in Reliance's near-term emission reduction strategy and captive use.”
Reliance still plans to go green
Reliance stated this month that the intention to produce blue hydrogen at Jamnagar was an interim step until the cost of green hydrogen comes down, while allowing it to “be the first mover to establish a hydrogen ecosystem, with minimal incremental investment, in India”.
In its presentation, Reliance claimed hydrogen production from syngas will eventually be replaced by green hydrogen, and Rystad agreed that the pursuit of blue hydrogen was only a transition step before switching to green hydrogen.
“The market that blue hydrogen and green hydrogen can together create will help accelerate the penetration of hydrogen in different sectors where it can be used to decarbonise current technologies,” Rystad said.
“The growth of the demand market will in turn help green hydrogen become more competitive… The blue hydrogen announcement might not have any significant impact on [Reliance's] plans for green hydrogen.”
Reliance unveiled a $10 billion plan last year spanning renewables, storage and hydrogen, including what it claims will be the world’s largest green energy equipment “giga-complex” and a 100 gigawatts capacity goal.
Ambani also announced in September last year Reliance was aiming to bring down the cost of producing green hydrogen to under $2 per kilogram, while it has set a stretch goal of bringing that cost down to below $1 per kilogram within 10 years.
However, the transition to green hydrogen will not see Reliance stop using the petcoke gasifiers, with the company intending to continue to utilise syngas “to produce value added downstream chemicals”.
“The CO2 capture units can be monetised in production of urea, synthetic fuel and other products once green hydrogen deployment starts,” Rystad told Upstream.
“Furthermore, the syngas can be converted to high-value chemicals. This suggests a value to blue hydrogen in the long term as well.”