Alberta-based Suncor Energy is partnering with Australian junior Hazer Group for a potential turquoise hydrogen project in Canada.

Hazer revealed Friday it had signed a memorandum of understanding with Suncor and FortisBC Energy to develop a 2500 tonne per annum hydrogen project based on Hazer’s low-emission hydrogen and graphite production process.

Are you missing out on ACCELERATE?
Gain valuable insight into the global oil and gas industry energy transition from ACCELERATE, the free weekly newsletter from Upstream and Recharge.

The trio will carry out an initial feasibility study into the proposed project, which will also produce roughly 9000 tonnes of synthetic graphite as a by-product.

The study is expected to kick off this month, with Hazer revealing the partners were set to award an engineering services contract.

Pending a positive outcome of that study, they will also collaborate to secure funding and conclude the binding agreements necessary to establish the project consortium and proceed with the development.

Under the agreements, Suncor will lead the development, both through the feasibility study stage and the engineering, and construction phases, while, upon completion, it will also operate the facility.

In addition to supplying its low-emission process technology, Hazer will lead engineering relating to the core Hazer technology components, and manage the supply of catalyst to the project.

The Hazer process allows the effective conversion of natural gas, and similar methane feedstocks, into hydrogen and high-quality graphite, using iron ore as a process catalyst.

FortisBC will provide the gas feedstock needed to produce the turquoise hydrogen, while it will also buy produced hydrogen from the facility.

Turquoise hydrogen is made using a process called methane pyrolysis to produce hydrogen and solid carbon.

The partners are targeting a final investment decision next year, which would place the project on track to commence production in 2025.

“The proposed hydrogen project will materially advance the Hazer technology building on the work that we are doing at the current Hazer Commercial Demonstration Project at Woodman Point in Perth, Australia,” said Hazer chief executive Geoff Ward.

“Canada is an excellent jurisdiction for the Hazer technology, with strong platforms and incentive programmes to drive decarbonisation action, access to a well-priced low carbon intensity electrical grid and strong demand for low-carbon energy across power, heating and industrial sectors.”

Hazer also revealed plans to enter negotiations with Suncor and FortisBC for a Technology Access Agreement, which would give the Canadian companies exclusive access to the Hazer technology for further development and deployment in Canada and the US state of Colorado.

In exchange for the access, Suncor and FortisBC would commit to a royalty payment regime as well as to providing support for the deployment of the Hazer technology.