BP and Ørsted to create renewable H2 partnership in Germany

BP and Ørsted signed a letter of intent (LOI) in mid-November 2020 to jointly develop a ‎project for industrial-scale production of green hydrogen—a significant step in developing ‎BP's hydrogen business. Green hydrogen is made by the electrolysis of water using ‎renewable power, producing zero emissions.

In their proposed Lingen green hydrogen project, the two firms intend to build an initial 50‎-MW electrolyzer and associated infrastructure at BP's Lingen refinery in northwest Germany. The plant will be powered by renewable energy generated by an Ørsted offshore ‎wind farm in the North Sea, and the hydrogen produced will be used in the refinery.‎

Under their LOI, BP and Ørsted will work together to further define the project, agree ‎definitive documents and plan to make a final investment decision (FID) in early 2022, subject ‎to appropriate enabling policies being in place. The companies anticipate the project could be ‎operational by 2024.

The 50-MW electrolyzer project is expected to produce 1 metric tph of green ‎hydrogen, or almost 9,000 metric tpy. This would be sufficient to replace around 20% of ‎the refinery's current gray hydrogen consumption, avoiding around 80,000 metric t of CO2 ‎equivalent emissions per year—equivalent to the emissions from around 45,000 cars in ‎Germany.

The Lingen refinery processes about 5 metric MMtpy (100,000 bpd) of crude oil, producing fuels, heating oil and chemical feedstocks. In 2018, Lingen conducted the ‎world's first trial of green hydrogen in a fuels refinery.‎

Green H2's promising future.

Heavy industries, such as refineries, use large quantities of hydrogen in their manufacturing ‎processes. They will continue to need hydrogen, but replacing the current fossil-based ‎hydrogen with hydrogen produced from renewable energy can help these industries ‎dramatically lower their CO2 footprint.

First, however, hydrogen must become cost-‎competitive with fossil-based hydrogen. Projects such as the BP-Ørsted JV will demonstrate the electrolyzer technology at large scale and ‎showcase real-life application of hydrogen based on offshore wind.

In the coming decades, hydrogen is expected to play a critical role in decarbonizing the ‎power, industry and transport sectors, especially those that are difficult or ‎expensive to electrify. The development of businesses in emerging technologies, such as ‎hydrogen and carbon capture use and storage (CCUS), is an integral part of BP's strategy of ‎transforming to an integrated energy company.‎

The Lingen project is also intended to support a longer-term ambition to build more than 500 MW of ‎renewable-powered electrolysis capacity. This could provide green hydrogen to ‎meet the refinery's entire hydrogen demand and provide feedstock for potential future ‎synthetic fuel production.

BP and Ørsted have together applied for funding for the Lingen green hydrogen project from ‎the EU Innovation Fund, one of the largest funding programs for innovative low-carbon ‎technologies.

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