Shell leadership rejected pursuing the low-carbon hydrogen plant on Norway's west coast due to a lack of demand in Europe.

Shell planned to implement a project on hydrogen production in Aukra, near its onshore processing facility located on the Nyhamna peninsula on the west coast of Norway. This facility processes gas from the Ormen Lange field with follow-up transportation to the UK via the Langeled pipeline. 

The project, indeed, a collaboration between Shell, Aker Horizons, and CapeOmega, had ambitious goals, including a planned capacity of 2,500 MW and the production of 1, 200 tons of blue hydrogen per day by 2030, which would have resulted in a significant reduction of 4 million tons of CO2 annually.

However, after the partnership agreement expired in June 2024, Shell decided not to renew it, citing the lack of a market for blue hydrogen as the reason.

Blue hydrogen is produced by converting methane with carbon capture and storage, reducing carbon emissions by about half. It is viewed as a step toward decarbonizing European industries, but it might be more expensive than traditional methods.

Shell's decision came soon after Equinor cancelled a similar blue hydrogen project. Equinor and Germany’s RWE had planned a hydrogen project with eventual green hydrogen production, export through a pipeline, and use in power plants in Germany. On September 20, 2024, Equinor announced the project was too costly, with insufficient demand. However, the company will still pursue hydrogen-powered gas plants in Germany, sourcing hydrogen from Europe instead of exporting it from Norway.

According to Handelsblatt, Equinor plans to produce hydrogen from natural gas in the Netherlands, which will be then transported to Germany.

Source: Neftegaz 

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