Low-carbon hydrogen gathers pace in UK refineries

As oil refineries explore options to decarbonise their hydrogen operations, local factors will play a crucial role, writes Aidan Lea

Five of the UK's six oil refineries are developing projects to lower the carbon intensity of their on-site hydrogen production, offering a potential blueprint for how other refiners around the world can decarbonise their hydrogen operations. But the unique characteristics of each refinery — its engineering design, local infrastructure, availability of renewables and carbon storage options — could make a uniform approach challenging.

Refineries account for 40mn t/yr of the global hydrogen consumption of around 90mn t/yr, according to the IEA, with almost all supply generated on site from fossil fuels with unabated carbon emissions. Hydrogen is used by refineries in hydrotreaters to remove sulphur and other impurities from fuels and in hydrocrackers that break heavy molecules into gasoline, diesel and kerosene.

Among the UK's facilities, only Phillips 66's Humber refinery has announced plans for renewable hydrogen production, via its wind-powered 100MW Gigastack project with Denmark's Orsted and UK-based ITM. Four other plants — Essar's Stanlow refinery, Ineos' Grangemouth chemicals complex, ExxonMobil's Fawley refinery and Prax's Lindsey site — are exploring using carbon capture and storage (CCS) technology. Prax is also exploring green hydrogen at Lindsey. The UK's sixth refinery, Valero's Pembroke facility, is a participant in a South Wales CCS cluster not selected for government funding, but was not immediately available for comment on its general hydrogen plans.

A key enabler for blue hydrogen projects has been the UK government's strategy of prioritising densely concentrated industrial areas for CCS funding. London's backing of the HyNet scheme and the East Coast Cluster in northern England put them on track for implementation in the mid-2020s, and should support low-carbon hydrogen production at Stanlow, Humber and Lindsey. But plans for CCS clusters in Scotland, South Wales and on the UK's south coast may be supported at a later stage, allowing Grangemouth, Pembroke and Fawley to capture emissions.

The coincidence of geography and the opportunity presented by the HyNet project — which will store carbon in the depleted reservoirs of the offshore Liverpool Bay oil and gas development — drove Essar's decision to opt for blue hydrogen production. Ineos' decision to make blue hydrogen at Grangemouth was similarly underpinned by access to the Scottish CCS cluster, where it will store over 1mn t/yr of CO2 offshore using existing pipelines, but also by obstacles that meant renewable hydrogen was not a feasible near-term option, the firm says. "Today there is not enough renewable power generation nor continuity of supply for green hydrogen to significantly decarbonise our site by 2030," Ineos says. "The region's power distribution system would not enable access to the required renewable power, and water electrolysis technology is not well developed at the large scale we need."

Location, location, location

All the refiners' CSS plans depend on the availability of suitable storage locations, such as aquifers, and the incentives of the government's cluster programme, while Phillips 66's green hydrogen project relies on offshore wind generation, underlining how local factors could determine refiners' path to hydrogen decarbonisation.

Making a strong business case for replacing hydrogen production is essential for companies to release funds. Collaborative cluster projects provide offtake partners for hydrogen once the refinery has met its own needs, and Ineos, Essar and ExxonMobil are all talking about supplying low-carbon hydrogen to surrounding areas. While not attached to a refinery, Norway's Equinor is following a similar model with its proposal for a 600MW blue hydrogen plant for the Saltend Chemicals Park based on offtake agreements with industrial partners in the East Coast Cluster.