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consignment of 40 tonnes of blue ammonia sands until you get to a point where there is no
generated from hydrocarbons to Japan under difference in [greenhouse gases] in conventional
a collaborative study between Saudi Aramco, oil and oil sands,” he told Reuters earlier this
SABIC and the Institute of Energy Economics month. “Reducing the carbon intensity of the oil
Japan (IEEJ). sands would, of course, allow more expansion.”
While the cargo is small, it is an important Alberta’s strategy is being developed at the
first step in proving the premise and will facil- same time as – and in line with – a federal hydro-
itate zero-carbon power generation for Japan, gen plan that is being prepared by Ottawa. Can-
where it will be used in gas turbines and a ada is already a leading producer of hydrogen,
co-firing boiler. Meanwhile, Aramco and making about 3mn tpy using steam methane
SABIC have taken the CO2 generated for use reformation of natural gas. However, it is now
in enhanced oil recovery (EOR) and methanol planning to target low- or zero-carbon hydro-
production respectively. gen. Alberta considers itself well-positioned to
For Saudi Arabia, the move illustrates the lead the way on blue hydrogen development,
kingdom’s efforts to use hydrogen to diversify given that it already uses CCS to sequester CO2
its economy following the summer announce- emissions from the oil sands through Royal
ment of a deal to construct the world’s largest Dutch Shell’s Quest project. It is hoped that as
hydrogen facility at the new $500bn NEOM more CCS infrastructure is developed, the costs
smart city. This is being built by a collabora- will come down.
tion of NEOM, ACWA Power and Air Prod- Preliminary reports on the federal plan sug-
ucts and will leverage 4 GW of solar and wind gests that it envisions several Canadian prov-
power to create 650 tonnes per day of green inces producing blue and green hydrogen, with
hydrogen, which will be converted into 1.2mn this industry generating significant jobs and rev-
tonnes per year (tpy) of green ammonia. enue at the same time as it reduces GHG emis-
Elsewhere in the Middle East this week, sions. However, concerns remain about the costs
independent operators Genel Energy and Gulf involved, as well as the cost-competitiveness of
Keystone Petroleum both reported receiving low-carbon hydrogen.
payment for August crude sales from the Despite these hurdles, however, Canada
Kurdistan Regional Government (KRG), appears to be advancing more rapidly than
while Sweden’s Maha Energy was belatedly neighbouring US as far as its low-carbon hydro-
awarded an EPSA for Oman’s Block 70. gen industry is concerned. This is not to say that
nothing is being done in the US, though. Rather,
If you’d like to read more about the key events shaping smaller-scale initiatives are quietly being pro-
the Middle East’s oil and gas sector then please click gressed, and could ultimately help underpin a
here for NewsBase’s MEOG Monitor. broader national hydrogen strategy.
The US Department of Energy’s (DoE) H2@
Canada leads the US Scale programme, described as a “multi-year ini-
In North America, Canada is leading the way on tiative to fully realise hydrogen’s benefits across
integrating hydrogen into its energy mix, while the economy,” has now been underway for four
little is being done in the US. Indeed, in Canada, years, and is beginning to show results. Over the
hydrogen could play a key role in the future of past year, the DoE is reported to have channelled
its oil sands – a region that has been battling more than $100mn in grants to around 50 pro-
to shake off its image as a major polluter. And jects to further the H2@Scale initiative.
efforts to formulate a strategy are underway on The Fuel Cell and Hydrogen Energy Associ-
both the federal and provincial levels. ation’s (FCHEA) president, Morry Markowitz,
Alberta Associate Minister of Natural Gas described in August the programme as “crucial
Dale Nally was reported in early September as to enabling broader commercialisation of trans-
saying that his province would unveil a strat- formational hydrogen and fuel cell technologies”.
egy for developing blue hydrogen no later than The FCHEA has published its own roadmap
October. This blue hydrogen would be used as towards a hydrogen economy for the US, which
a cleaner alternative to natural gas for produc- could be used to inform a national strategy if the
ing heavy crude from Alberta’s steam-driven oil US government decides to pursue one.
sands projects. Thus far, the US has not prioritised decar-
The plan is aimed at allowing Alberta to bonisation nearly as much as Canada or various
produce more crude from the oil sands without other countries on the federal level, and it has
exceeding the province’s cap of 100mn tonnes been up to the private sector to advance initia-
per year (tpy) on carbon emissions, according to tives, including those involving hydrogen. With
Nally’s comments. a particularly tense presidential election loom-
“Hydrogen will allow us to continue to move ing, much is currently uncertain about how
the bar and reduce the carbon intensity of the oil much this will change beyond 2020.™

P8 www. NEWSBASE .com Week 39 01•October•2020