The new Eldorado of white hydrogen

Published by Louis Bellemare on 2024-05-30

Distant future

Not in a very distant future, the winner of the Formula 1 season could be Red Bull-Honda. But it could just as well be Mercedes, or even McLaren, or even Ferrari. As long as these vehicles are powered by hydrogen, it would make all the difference.

Racing cars will not have a driver. They will be autonomous. Too bad for champagne producers. Moreover, hydrogen combustion is much more silent than gasoline cars when it is powered by fuel cells. Goodbye drivers, but also goodbye to the infernal din of the Grand Prix. This is considerable progress. This is even very good news.

One kilogram of hydrogen releases three times more energy than its gasoline equivalent while producing only water as residual matter. It is therefore non-polluting. Hydrogen is abundant on Earth in atomic form, constituting an almost inexhaustible quantity of energy. It can be an effective means of storing electricity over long periods. For all these reasons, it is considered the fuel of the future for energy transition.

At present, hydrogen is expensive, much more expensive than gasoline. Only people like the big owners of Formula 1 or NASA can afford to pay for this fuel .

The discovery of natural hydrogen

Something that seemed unlikely a few years ago has changed the situation. Large quantities of natural hydrogen have been discovered in the Earth’s subsoil. The first well was found by chance in Mali in the mid-1980s. Later, another source was found in Lorraine, France, representing 46 million tons, or half of the world’s annual hydrogen production. ^1 2

Since then, other wells have been discovered all over. Notably, in the United States, throughout Europe, in Asia, and in Canada. It was thought impossible to find this element in its pure state on our planet. But, there could be an abundance of it everywhere, although we still do not know the exploitable quantity.

The extracting cost of this type of hydrogen H2 is a major advantage. It would be much lower than other means of production and could become more competitive compared to fossil fuels. Also, according to specialists, natural hydrogen can regenerate itself in the earth’s subsoil. This represents an almost inexhaustible source of energy.

The colors of hydrogen

To understand the dynamics of hydrogen development, you need to know that it comes in different colors. There is black, gray, blue, turquoise, pink, yellow, green and of course white. ³ These are not real colors since hydrogen is colorless. Assigning colors to hydrogen is a way to categorize the different means of production. Different means of production produces different intensity of carbon production (see the box below).

Specialists speak of an Energy-Production-Energy process. Hydrogen is an energy vector, not a fuel in the strict sense. ⁴ It means it is necessary to provide energy first to produce hydrogen, which is an expansive process. Separation of hydrogen by hot steam or electrolysis are examples. 95% of its production is carried out by the transformation of fossil fuels for economic reasons. Almost half is from natural gas, which is still polluting.

The different colors of hydrogen

Black hydrogen: you guessed it, this is the most polluting of the production processes. It is produced from coal, itself converted into gas before being transformed into hydrogen. Its cost is between $2.072/kilo Canadian and $3.4/kilo;

Grey hydrogen  : the most common and cheapest to produce, it is made from methane steam reforming, i.e. using high-temperature water vapor (700-1000°C). It is therefore of fossil origin. Unfortunately, it is not the most environmentally friendly means of production. Its cost is between $1.48 and $3.7/kilo;

Blue hydrogen: This type is produced from fossil fuels. It is associated with a device for capturing and storing the CO2 produced (CCS). It is nevertheless considered a low-carbon hydrogen. Its cost is approximately $5.18/kilo [1] ;

Green hydrogen: green hydrogen is produced from renewable electricity through the electrolysis of water. It is in the low-carbon category. Its cost is $3 to $10/kilo depending on the place of production or whether the electricity is produced by hydraulic dams, wind turbines or solar panels;

Pink hydrogen  : It is also produced by electrolysis of water, but it is obtained from nuclear electricity. Its cost is about $5.8/kilo;

White hydrogen: White hydrogen is extracted directly from the ground in its molecular form H2. This process eliminates the need for expensive or polluting processing techniques. Its extraction cost would be less than $1.48/kilo.

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Why is it so expansive

One can realize that hydrogen production is expansive. It is even more so if we want to produce low carbon. ⁵ Electricity represents up to 80% of the total production costs according to the localization of production and its type. ⁶  Producing hydrogen is much more expensive than gasoline, except for white hydrogen. The minimum price of a liter of gasoline at the loading ramp (before storage, transportation, and taxes) was $1.44 per kilo for regular gasoline. ^7 8

Furthermore, very large amounts of energy are required to store hydrogen. Due to its low density as an element, its transport per unit volume is much more expensive than hydrocarbons. According to some estimates, transport costs would be between $1.3 and $3 CAD/kilo. Depending on whether it is transported by pipeline, liquefied transport, or compounded with an organic liquid. Considering the storage, transport, and profit margins of intermediaries, hydrogen at the pump is twice as expensive as gasoline.

Is there a market for white hydrogen?

One might be tempted to believe that low-carbon hydrogen is not competitive because of its high costs. However, we can see the following facts:

• There is already a market for some specialized applications (ammonia production, glass manufacturing, metal processing, and oil refining). It can also be used for some heavy industries, heavy-duty transport, and long-distance haulage.  ⁹
• Regulations, subsidies, and taxes have the consequence of setting an increasingly high price for carbon. This contributes to the development of non-polluting alternative energies. This is imperatively the case for hydrogen.
• According to some studies ^10 11, the cost of producing green hydrogen could fall by up to 85% by 2050. Notably, technological advances will reduce costs of producing electricity.

Extraction of white hydrogen directly from the Earth’s subsoil would make it much less expensive. This could cause the price to a spiral downward.

Geological discoveries are still in their infancy, much like they were over 100 years ago when oil leaks were found. The abundance of this type of hydrogen could make it very competitive with fossil fuels.

What about in Canada and Quebec?

Canada produces about three million tonnes of hydrogen per year. It is produced mainly with natural gas and is currently one of the world’s top ten producers.

In addition, the Geological Survey of Canada mapped potential accumulations of pure hydrogen in its soil since 2022. There is a potential for discoveries in Canada because of the size of its territory and its rock type. Helium extraction zones in Saskatchewan and Alberta, and in seismic zones of British Columbia and Ontario have shown some interest.¹² 

In Quebec, an initial study ¹³ also indicates significant potential due to the presence of a type of rock. Quebec’s territory is diverse in its geological environments. This diversity makes it a promising territory for the exploration of natural hydrogen. It could be found in the Canadian Shield.

Conclusion

The craze for white hydrogen around the world is not just passing. Germany announced a few months ago that it would spend 9 billion euros to become the number one hydrogen producer. ¹⁴ France has announced massive funding to explore the potential of white hydrogen. ^15 16

The “Quebec Strategy on Green Hydrogen and Bioenergies 2030” ¹⁷ mentions natural hydrogen only once as a source of development. It is calling for its potential to be documented in Quebec. Quebec privileges green hydrogen due to its abundant electricity. However, its ability to produce low-cost electricity is starting to be limited.

It would be appropriate to invest in the exploration and prospecting of white hydrogen. It could be cheaper than massive investments for the construction of new electricity production capacities necessary for green hydrogen,

Louis Bellemare

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References

1. Expert Opinion: Natural Hydrogen ↩︎
2. Will natural hydrogen be the new oil ? ↩︎
3. Everything you need to know about the colors of hydrogen ↩︎
4. The essentials of hydrogen ↩︎
5. The competitiveness of grey, blue and green hydrogen ↩︎
6. Cérémé, the energy of reason. Studies of the complete costs of hydrogen ↩︎
7. One liter of gasoline is equal to .75 kilograms ↩︎
8. Minimum prices at the loading ramp ↩︎
9. Market Insight: Hydrogen Could Be Part of Global Move Toward Carbon Neutrality ↩︎
10. Cost of producing green hydrogen expected to drop by up to 85% by 2050, BloobergNEF says ↩︎
11. Green hydrogen still needs to lower its costs ↩︎
12. Canada in search of white hydrogen ↩︎
13. Potential of natural hydrogen in Quebec (Canada): an initial assessment ↩︎
14. Hydrogen, Canada’s new energy Eldorado ↩︎
15. White hydrogen, the potential of an energy revolution for France ↩︎
16. Everything you need to know about hydrogen ↩︎
17. Quebec strategy on green hydrogen and bioenergies ↩︎