Page 15 - AsianOil Annual Review 2021

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however, with the refiner having clearly stated “Hydrogen will be a core in Sinopec’s energy
that its hydrogen interests would take centre transition ... We want to become China’s num-
stage in the coming years. ber-one hydrogen firm,” said Zhang.
While more green hydrogen projects – such
Green hydrogen launch as the one in Inner Mongolia – are on the cards,
The refiner announced on May 25 that it aimed the company also wants to capitalise on its exist-
to launch its first project that produces green ing grey hydrogen production base in the short
hydrogen, which is created using renewable term.
energies, in Inner Mongolia next year.
The CNY2.6bn ($406.9mn) facility, to be What next
located in Ordos City, will have a production Around 67% of China’s more than 20mn tpy of
capacity of 10,000 tpy in the first phase and will hydrogen production comes from fossil fuels,
be fed by a 270-MW solar power plant and a with another 30% the by-product of industrial
50-MW wind farm. It will later be expanded to processes, according to the China Hydrogen
20,000 tpy. Alliance.
The plant’s production will feed a nearby The alliance argued in 2019 that while the
coal-to-chemical project run by Zhong Tian He country’s long-term goal should be to develop
Chuang Energy, a joint venture between Sino- green and blue hydrogen capacity, the country
pec, China Coal Energy, Shenergy and Inner stood to benefit from a short-term focus on
Mongolia Manshi. increasing the use of grey hydrogen.
Sinopec said the project would not only Such a shift aligns with Sinopec’s agenda, with
help it become China’s leading hydrogen com- Zhang noting in March that the company wanted
pany by 2025; it would also reduce Zhongtian to produce blue hydrogen from its current grey
Hechuang’s carbon emissions. hydrogen output. The executive highlighted the
The company said in March that its plans company’s strengths in both production and
to reach carbon neutrality by 2050 would be distribution, adding: “We have been producing
underwritten by a pivot towards hydrogen hydrogen for our refining and petrochemical
development. complexes, while we have the biggest retail net-
While Sinopec is already the country’s larg- work in China.”
est producer of hydrogen, most of which is grey The development of commercial CCS tech-
hydrogen – a by-product of its downstream nology will be key to achieving this next step
operations – the company intends to ramp up its for Sinopec. As such, the company already has
investment in production of both blue and green a number of operational pilot projects around
forms of the fuel, chairman Zhang Yuzhuo said China, including one at a fluid catalytic cracking
on March 29. Blue hydrogen is created using (FCC) unit at a refinery in Henan Province as
fossil fuels, but utilises carbon capture and well as at a power plant in Shandong Province.
storage (CCS) technology to trap the resulting Sinopec’s focus on exploiting its grey hydro-
emissions. gen business, especially given the company’s
Sinopec’s hydrogen production capacity focus on extending the life of its downstream
amounts to 3.5mn tonnes, around 14% of the assets by retooling for greater petrochemical
country’s total. The company intends to establish production, makes sense. For such efforts to
100 hydrogen filling stations this year, ramping work, however, greater investment is needed to
up to 1,000 such facilities by 2025. deliver commercial-scale CCS applications.™

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