Sinopec, China’s second-largest energy company, aims to reach carbon neutrality by 2050 — a decade ahead of the nation’s 2060 net-zero emissions target set last September by China's President Xi Jinping.

The company's new target of net-zero emissions by 2050 is significant as Sinopec is the world’s top refiner, with nameplate crude-distillation capacity exceeding 6 million barrels per day.

Hydrogen will be a key part of the picture as Sinopec transitions to cleaner energy sources, the company said.

It will also implement other measures to reduce its carbon footprint, including low-carbon production of refinery products, with net-zero emissions as its “ultimate goal” in the refining process, said Sinopec chairman Zhang Yuzhuo.

“Hydrogen will be the linchpin in Sinopec’s endeavour to develop new energy,” he said.

Green and grey hydrogen

The company plans to develop green hydrogen projects, which will use renewable energy and electrolysis to split water molecules into hydrogen and oxygen.

Sinopec will build 1000 hydrogen gas refilling stations over the next five years — up from the current total of just 10 — as part of a bigger plan to become China’s largest hydrogen company, Zhang told investors last weekend.

Hydrogen fuel cell vehicles are expected to be used during the 2022 Winter Olympic Games in Beijing. The Yanshan project is already providing 500 kilogrammes of hydrogen to Beijing through hydrogen fuel cells, according to Zhang.

Sinopec has also signed a letter of intent with Enze Haihe Fund and Cummins — China’s leading power turbine solution provider — to work on projects involving green hydrogen production.

How much green hydrogen production the company is targeting and the time frame for development are unclear as it is still working out the details of its plan.

Sinopec's current hydrogen development projects in China rely on hydrogen units built at three major refining-chemical integrated plants — Yanshan Petrochemical, Guangzhou Petrochemical and Gaoqiao Petrochemical — as well as the hydrogen byproduct from its massive refining units.

Last year, the company produced 350 tonnes of grey hydrogen gas from refinery units, which accounted for 14% of the nation's total grey hydrogen produced. Grey hydrogen is hydrogen produced from fossil fuels without capturing and storing the resulting carbon emissions.

The company is building reforming and naphtha cracking units that will produce grey hydrogen at its Yanshan petrochemicals complex in Beijing with a production capacity of 2000 cubic metres per hour of uncompressed hydrogen gas.

Carbon capture

Sinopec's net-zero target by 2050 follows that of state oil giant China National Petroleum Corporation, China’s largest energy producer, which has also announced it is aiming for net-zero carbon dioxide emissions by 2050.

In addition to its hydrogen ambitions, Sinopec is promoting the recovery and utilisation of high-concentration CO2 tail gas from refining and chemical operations.

The company aims to reduce its methane emissions from oil and gas production by 50% by 2025 and has started a pilot programme to build a carbon capture, utilisation and storage (CCUS) base in eastern China’s Jiangsu province.

Sinopec Nanjing Chemical in Nanjing city, Jiangsu, along with Sinopec Huadong Petroleum Bureau, which operates the Jiangsu oilfield, have already installed two carbon capture and storage (CCS) units, with annual capacity of 100,000 tonnes.

The two units capture carbon dioxide emitted from synthetic ammonia units and coal-to-gas units. The CO2 is reinjected into oil reservoirs to enhance oil recovery at the Jiangsu field.

Sinopec said it will raise the CCS capacity at the Jiangsu pilot project to 1 million tonnes by 2025.

Forests to offset some emissions

Sinopec is also working on bio solutions to offset carbon emissions by creating forests.

Greener ambitions: Sinopec's forest at Shengli oilfield Photo: SINOPEC

At the Shengli oilfield in eastern China’s Shandong province, Sinopec has planted more than 1 million trees in an area covering 15,333 square metres. They can offset 5000 tonnes per annum of carbon emissions.

Shengli, which currently produces 460,000 bpd of oil, emitted 8.04 million tonnes of CO2 last year, down from 8.66 million tonnes in 2019. Shengli aims to further cut emissions by 20% in 2025.