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Reliance Industries aims to become world's top blue hydrogen maker

The operator of the world's largest oil refining complex will repurpose a Rs 30,000 crore plant that currently converts petroleum coke into synthesis gas to produce blue hydrogen for USD 1.2-1.5 a kilogram, Reliance said in a presentation detailing the separation plan.

February 14, 2022 / 09:16 AM IST
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Billionaire Mukesh Ambani's Reliance Industries Ltd is targeting to become one of the largest producers of blue hydrogen globally, producing zero-emission fuel at costs that will be half of the global average.

The operator of the world's largest oil refining complex will repurpose a Rs 30,000 crore plant that currently converts petroleum coke into synthesis gas to produce blue hydrogen for USD 1.2-1.5 a kilogram, Reliance said in a presentation detailing the separation plan.

Hydrogen is the cleanest form of known fuel. Depending on production methods, hydrogen can be grey, blue, or green. While grey hydrogen is the most common form and is generated from natural gas, or methane, through a process called 'steam reforming', blue hydrogen is whenever the carbon generated from steam reforming is captured and stored.

Blue hydrogen is, therefore, sometimes referred to as carbon neutral as the emissions are not dispersed in the atmosphere. Green hydrogen - also referred to as 'clean hydrogen' - is produced by using clean energy from renewable energy sources, such as solar or wind power, to split water into two hydrogen atoms and one oxygen atom through a process called electrolysis.

Reliance, which has set a net-zero carbon emission target for its businesses by 2035, is looking at blue hydrogen in the interim period while the cost of green hydrogen reduces.

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"In the interim, till the cost of green hydrogen comes down, RIL can be the first mover to establish a hydrogen ecosystem, with minimal incremental investment, in India," Reliance Industries Ltd (RIL) said in the presentation.

Syngas has the potential to produce hydrogen at a competitive cost of USD 1.2-1.5 per kg, it said. Green hydrogen produced with renewable resources costs between USD 3-6.55 per kg, according to the European Commission's July 2020 Hydrogen strategy.

Fossil-based hydrogen costs about USD 1.80, and the commission estimated the cost of blue hydrogen at about USD 2.40-3 per kg. Ambani had previously stated that his group is aiming to produce green hydrogen at USD 1 per kilogram by the turn of this decade. Last month, he announced plans to invest about USD 75 billion in renewables infrastructure.

Reliance said RIL's framework for reducing carbon footprint includes migration from fossil energy to renewables, maximizing sustainable materials and chemicals as part of its portfolio, and carbon fixation, capture, and utilization.

"Transition to Net Carbon Zero provides a unique opportunity to unlock value through repurposing of assets and upgradation of configuration," it said.

At its mega oil refining complex at Jamnagar in Gujarat, the low value fuel streams (off-gases) are taken out from the fuel pool and used as feedstock to convert to high value petrochemicals. This syngas project will now be transferred to a subsidiary it owns fully with a view to unlocking value.

"Jamnagar energy demand is currently met through fossil fuels including syngas from the gasifiers. Fossil fuel can be replaced by renewables, including solar, biomass-based fuel, hydrogen and changing steam drives to electric drives", the firm noted.

Jamnagar will progressively transition to renewables with a battery energy storage system (BESS) to meet its electricity and steam demand. Over a period of time, hydrogen demand will be met by green hydrogen produced through water electrolysis. Repurposing the gasification assets will involve using syngas to produce hydrogen.

"Subsequently, as hydrogen from syngas is replaced by green hydrogen, the entire syngas will be converted to chemicals," the firm said, adding it will explore biomass feed in gasification to produce green hydrogen.

"Hydrogen production from gasification provides highly concentrated carbon-di-oxide (CO2) stream which provides unique opportunity to capture 15 million tonnes per annum of CO2 at 30 percent of the typical cost of carbon capture," Reliance said adding this CO2 can be monetized by sale to urea producers and other users.

The gasification unit is proposed to be transferred, as a going concern on slump sale basis, by way of the proposed scheme, it said, adding the scheme of Arrangement has been presented to National Company Law Tribunal for approval.
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