Page 13 - FSUOGM Week 39

FSUOGM NRG FSUOGM

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

Week 39 30•September•2020 www. NEWSBASE .com P13