Plans to produce low-carbon hydrogen, using natural gas and carbon capture, utilization and storage (CCUS), are gaining momentum in major producing states such as North Dakota and Texas.

Bakken Energy LLC on Monday agreed to acquire the Great Plains Synfuels Plant in Beulah, ND, as part of a larger plan to develop a more than $2 billion low-carbon hydrogen hub in the state. The Synfuels Plant is owned by Dakota Gasification Co., aka Dakota Gas, a subsidiary of Basin Electric Power Cooperative.

Bakken Energy agreed to purchase Dakota Gas and reconfigure the Synfuels Plant to produce low-carbon blue hydrogen using methane auto-thermal reforming (ATR) technology and CCUS.

Blue hydrogen refers to splitting hydrogen atoms from natural gas, either by ATR or steam methane reformation (SMR), then preventing carbon dioxide (CO2) emissions to be released. Green hydrogen, meanwhile, entails splitting hydrogen from water via electrolysis powered by low-carbon electricity sources such as renewables or nuclear.

The Synfuels Plant “is an established, large-scale producer of synthetic fuels and provides the existing infrastructure and processes required to accelerate its transformation into the largest and lowest-cost producer of low-carbon clean hydrogen and ammonia in the United States,” said Bakken Energy.

Because of its versatility as an emissions-free fuel and an energy carrier, hydrogen is seen as a vital component to the global energy transition. It is viewed as particularly promising in sectors where direct electrification is difficult, such as heavy industry and long-haul shipping, according to the International Energy Association.

Natural gas utilities and pipeline operators also are experimenting with blending hydrogen into their existing gas transmission and distribution networks.

The North Dakota Hydrogen Hub is expected to be operational by late 2026, with the Synfuels Plant slated to produce an estimated 310,000 metric tons/year of hydrogen, Bakken Energy said.

By converting a  brownfield plant rather than building a greenfield project, Bakken Energy expects to cut in half the typical 10-year lead time required to begin producing clean hydrogen.

The project would use advanced ATR technology and capture 95% of CO2 emissions, the company said. ATR technology was selected over SMR to maximize CO2 capture rates and repurpose existing Synfuels Plant infrastructure and processes.

Gov. Doug Burgum said the agreement “is of historical significance for our state and nation and heralds the extension of North Dakota being home to innovative leadership in fueling and feeding the world.” Ammonia is used primarily to create nitrogen fertilizer. 

“The North Dakota Hydrogen Hub will lead to the establishment of new industries, create high paying jobs and the development of new domestic and foreign markets,” Burgum added.

Bakken Energy and Mitsubishi Power Americas Inc. in June announced their intention to develop the hub. At the time, Bakken Energy CEO Mike Hopkins said producing hydrogen from natural gas, “with the carbon captured and with its cost advantages, is the best way to accelerate the adoption of hydrogen.”

Bakken Energy Chair Steve Lebow on Monday said it is the “dawning of the hydrogen economy in the United States of America.” Hopkins added, “The North Dakota Hydrogen Hub will become a critically important, centrally located hydrogen complex and part of a nationwide, interconnected collection of hubs spanning the country.’

The Synfuels Plant is to continue existing operations through 2025, according to officials. The Dakota Gas acquisition is set to be completed by April 1, 2023.

Gulf Coast ‘Uniquely Suited’

Meanwhile in South Texas, the Port of Corpus Christi Authority (PCCA) and Howard Midstream Energy Partners LLC have a memorandum of understanding (MOU) to convert Howard’s Javelina refinery services facility into the Gulf Coast region’s first carbon-neutral hydrogen production facility.

The facility at the port has “pipeline connectivity to all six of the local refineries,” PCCA said. Javelina controls about 60 MMcf/d of hydrogen production “through a combination of hydrogen entrained in the refineries’ waste gas that the facility processes, and hydrogen produced through” the SMR process. The hydrogen is then used in the refining process to remove impurities such as sulfur. 

[Bidweek Change: After gathering feedback from price reporters, its subscribers and the marketplace, NGI is changing the trading period for its Bidweek to three days to better align with industry trends. Find out more here.]

“The Port of Corpus Christi and Howard ultimately hope to scale hydrogen production for exports to overseas demand centers,” PPCA said. 

PCCA, which moves oil and liquefied natural gas to overseas markets, noted that natural gas “is in abundance at the Port of Corpus Christi due to direct connections to the Permian Basin and Eagle Ford Shale production fields.”

Under the MOU, Howard would capture carbon emissions from the SMR process at Javelina.

“The Port of Corpus Christi is uniquely suited to become the nation’s premier carbon capture and sequestration management hub based on the high density of industrial CO2 emitters, a robust network of existing pipeline infrastructure, and the Port Authority’s ownership of lands leading to state waters in the Gulf of Mexico,” PPCA said. The region “is uniquely suited for injection and storage of pressurized CO2.”

Blue Ammonia 

In related news, Mitsui & Co. Inc. and CF Industries Holdings Inc. last week announced an MOU to jointly develop blue ammonia projects in the United States.

Mitsui is a leading ammonia marketer, while CF is one of the world’s largest manufacturers of nitrogen and phosphate fertilizers. CF consumes about 1 Bcf/d of natural gas as a feedstock and fuel source, the firm’s manager of raw materials, Catherine Payne, told the LDC Gas Forums Northeast event last month. 

“Demand for blue ammonia is expected to grow significantly as a decarbonized energy source, both for its hydrogen content and as a fuel itself,” CF and Mitsui said in a joint statement, noting that CF is the world’s largest ammonia producer.

“As countries and industries continue to develop plans to achieve net-zero carbon emissions, there is broad interest in blue and green hydrogen and ammonia to help meet the world’s clean energy needs,” said CF CEO Tony Will.

The companies plan to study the feasibility of blue ammonia production in the United States.

Areas of study will include “establishing blue ammonia supply and supply chain infrastructure, CO2 transportation and storage, expected environmental impacts, and blue ammonia economics and marketing opportunities in Japan and in other countries,” the firms said.