Uniper partners with Shell for blue hydrogen production in Lincolnshire

Image: Uniper

Blue hydrogen production involves manufacturing hydrogen from natural gas using reformation processes, and then capturing process emissions using man-made carbon capture and storage (CCS) technologies. Uniper is proposing to create a production facility with a capacity of up to 740MW at the Killingholme gas-fired power station.

CO2 captured at the plant, which is being called ‘Humber Hub Blue’, would be fed through the Zero Carbon Humber onshore gas pipeline, which has already been proposed as part of the East Coast Cluster – one of the collaborative projects aiming to create net-zero industrial clusters in the UK.

Uniper estimates that Humber Hub Blue would capture around 1.6 million metric tonnes of carbon annually. This forecast is down from the 2 million metric tonnes it was touting last year. It is yet to disclose what portion of the process emissions 1.6 million or even 2 million metric tonnes would represent.

Uniper first announced its ambitions to produce blue hydrogen at Killingholme, which has operated in its current format since 1993, last year. It has since passed the eligibility application for Phase 2 of the Government’s CCS cluster sequencing process, paving the way for additional Government funding to be awarded later this year.

In partnership with Shell, Uniper will now work towards moving the project to the front-end engineering and design stage within a year. If everything progresses to time, a final investment decision will be made by the end of 2024 and the facility will open by 2027.

Uniper’s UK country chairman and chief commercial power officer Mike Lockett said: “The development of a hydrogen production hub at Killingholme represents a significant step towards decarbonising the UK’s largest industrial cluster. Future proofing the industry, this investment has the potential to secure and grow the region’s economy.”

Shell’s country chair for the UK, David Bunch, added: “We plan to invest up to £25bn the UK energy system over the next decade subject to Board approval, and more than 75% of this is for low-carbon and zero-carbon technology. Hydrogen and CCS will be key to these plans. They can also help stimulate economic growth and jobs. That is why it is critical that both government and industry continue to work together to drive change.”

Shell and Uniper have both set 2050 net-zero strategies but their credibility continues to face questioning. Organisations like the International Energy Agency (IEA) have been calling on energy majors to back their net-zero claims with appropriate investment strategies, after 2019 IEA analysis found that just 1% of global oil and gas majors’ funding went to renewables. Some net-zero collaborations, including the Race to Zero, do not accept fossil fuel firms as participants.

Hydrogen policy context

The UK Government’s Energy Security Strategy, published last week, increased the national 2030 capacity target for blue and green hydrogen generation from 5GW to 10GW. This move was broadly welcomed, but some green groups had been hoping for the government to place less of a focus on blue hydrogen, given that it is not a proven low-carbon alternative for natural gas. Under its current “twin-track” approach, the UK Government has stated that it intends to support blue and green hydrogen equally this decade.

Aside from Humber Hub Blue, blue hydrogen projects in the UK’s pipeline include BP’s 60MW site proposal in Teesside and Equinor’s H2H Saltend project.

There are a greater number of green hydrogen projects in the UK’s pipeline at present. Proposed locations include Shoreham, Teesside; the Port of Cromarty Firth ; the Flotta Terminal on the island of Orkney and Eaglesham Moor, at the Whitelee onshore wind farm. Uniper is also exploring up to 100MW of green hydrogen capacity at Killingholme.

Just this week, First Hydrogen confirmed that it is engaged with discussions with landowners and local authorities at a further four locations, in the hopes of developing green hydrogen production hubs.