Norwegian energy company Equinor has abandoned plans to export blue hydrogen to Germany, citing high costs and insufficient demand. The project, which was part of a broader effort to build a hydrogen supply chain for German power plants, was scrapped after a feasibility review.
Equinor and Germany's RWE had signed a memorandum of understanding in January 2022 to develop hydrogen production from natural gas combined with carbon capture and storage (CCS), known as blue hydrogen. The plan involved exporting the hydrogen via the world's first offshore hydrogen pipeline from Norway to Germany.
“The hydrogen pipeline hasn't proved to be viable. That also implies that hydrogen production plans are also put aside,” said Magnus Frantzen Eidsvold, a spokesperson for Equinor. The pipeline, which would have cost around €3 billion, was deemed financially unfeasible as part of a supply chain projected to cost tens of billions of euros.
Equinor said that without firm long-term commitments from European buyers, it could not proceed with the project. “We are not able to make this kind of investments when we don't have long-term agreements and the markets in place,” Eidsvold added.
Plans to develop hydrogen-ready gas power plants in Germany with RWE will still move forward, though the hydrogen will now be sourced from within Europe rather than exported from Norway. A German economy ministry official stated that discussions between the German and Norwegian governments are ongoing, with a new plan involving hydrogen production in the Netherlands and carbon storage in Norway.
RWE has indicated that hydrogen-ready gas power plants could begin production by 2030, provided the German government establishes a support regime for such facilities.
Equinor will continue to explore other early-phase hydrogen projects, particularly in Britain and the Netherlands.
Source: Reuters
