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Adnoc + Posco partner on blue hydrogen production in S. Korea: The Abu Dhabi National Oil Company (Adnoc) has signed a strategic cooperation agreement with South Korea’s largest steelmaking companyPosco Holdings to build a low-carbon blue hydrogen production plant at the latter’s Gwangyang LNG terminal in South Korea, The Korea Herald reported last week. The financials of the agreement were not disclosed.
REFRESHER- What is blue hydrogen? Blue hydrogen is created from natural gas or other methane sources through a process called steam methane reforming (SMR), which uses high-temperature steam to produce hydrogen and CO2. Blue hydrogen uses carbon capture and storage (CCS) tech to prevent the CO2 from being emitted, rendering it low-carbon.
What’s next? The South Korean steelmaker and its trading arm Posco International will partner with Adnoc to conduct a feasibility study this year to evaluate CCS viability and the construction process, Business Korea (BK) reports.
Part of Korea’s big industrial decarbonization plans: The blue hydrogen produced would first be used at the company’s Gwangyang steel mill and then extend to other demand centers in South Korea like Hadong and Yeosu beginning in 2029. The Korean firms aim to leverage Adnoc’s carbon capturing and storage expertise as part of a target to secure a clean hydrogen supply system of some 1.26 mn tons by 2035, according to BK.
Banking on a wealth of experience: Adnoc — which ahead of COP28 said it intends to double its targeted carbon capacity to 10 mn tons by 2030 — has announced a strategic partnership with MENA fertilizers firm Fertiglobe for the pilot deployment of the world’s first cost-effective modular carbon capture unit. The company also reached a final investment decision to set up one of the region’s largest carbon capture projects in the UAE, inked an agreement with Australia’s Santos to establish a joint carbon management program in the Asia-Pacific region, and last month acquired a 10.1% stake in UK-based CCS and blue hydrogen project developer Storegga.
Posco has ties to the region: Back in June, Posco was awarded a USD 6.7 bn contract to set up what it said will be the world’s largest green hydrogen plant in Oman’s Duqm. Later in July, Posco signed an agreement with KSA’s Acwa Power to jointly develop green hydrogen and its derivatives.
And plans to spend USD bns to decarbonize: The global steel industry accounts for about 8% of global greenhouse gas emissions, generating around 1.85 tons of CO2 per steel ton, and Posco remains South Korea’s largest corporate emitter. The company estimates its carbon-neutrality ambitions would have a 40 tn KRW (USD 30 bn) price tag and require the development of nine clean hydrogen production plants. The company said it plans to allocate some USD 93 bn to scale its hydrogen, battery materials, and steel production sectors and raised USD 500 mn last month in three-year green bonds to help realize that target.
