Energy start-up C-Zero Inc.’s promise to commercially scale carbon-free hydrogen production using natural gas has drawn investments from commodity trading giants through a recent financing round.
The California-based company’s latest funding round, completed for $34 million, was led by SK Gas Co., a subsidiary of South Korea’s SK Group. Engie New Ventures, the venture capital arm of Engie SA, and commodity trading giant Trafigura Group Pte. Ltd also participated.
C-Zero executives said the latest injection of capital brings it closer to constructing a pilot plant that could become operational by early 2023.
The facility would use C-Zero’s decarbonization technology to process 4,450 cubic meters/day of hydrogen from natural gas. C-Zero previously completed a $11.5 million funding round led by Breakthrough Energy Ventures, the investment fund helmed by Bill Gates. Eni Next LLC, a clean energy venture capital company from Italy’s Eni SpA, participated along with Mitsubishi Heavy Industries (MHI) and AP Ventures. Some existing investors also participated in the most recent fundraising round.
Chief Technology Officer Eric McFarland said the backing from experienced energy investors and natural gas traders helps further clinch its goal to scale-up technology.
“Natural gas provides a quarter of the world’s energy, so the scale of the opportunity ahead of us is enormous,” McFarland said. “But we cannot do it alone.”
The firm has been developing a way to process natural gas into hydrogen and water using a mixture of molten salts to trap carbon dioxide (CO2) in solid form. The methane pyrolysis process eliminates the need to transport or inject CO2 and other emissions, creating what C-Zero refers to as turquoise hydrogen.
Hydrogen created from natural gas is typically referred to as gray hydrogen and is referred to as blue hydrogen when CO2 is removed and captured.
Global natural gas heavies like SK Gas are exploring opportunities for C-Zero’s technology to bridge current investments with the next generation of energy. SK Gas CEO Brian Yoon said the company sees “great synergies” with the technology’s potential and its plans to build “a hydrogen value chain complex” in Ulsan, South Korea.
“SK Gas,” he said, “ strongly believes in the potential of methane pyrolysis and its ability to help countries like Korea in their decarbonization efforts by producing low-cost, clean hydrogen.”
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