Exxon affiliate seals hydrogen supply deal
ExxonMobil's Canadian affiliate Imperial said September 6 it had finalised a deal with Air Products & Chemicals to procure low-carbon hydrogen for its renewable diesel production plant under development near Edmonton.
Under the partnership deal, Air Products' forthcoming 165mn ft3/d blue hydrogen facility will be connected to Imperial's renewable diesel unit at its Strathcona refinery.
The two projects, both due to launch in 2024, are part of a national campaign to deliver Canadian carbon neutrality by 2050, partly by diversifying clean energy resources with additional hydrogen capacity. Imperial is a member of Canada's oil sands net zero partnership - Oil Sands Pathways to Net Zero Alliance - aimed at eliminating net emissions from upstream oil sands operations by mid-century.
Samir Serhan, COO of Air Products, explained: "Canada is rapidly implementing an energy transition that emphasises the use of low-carbon hydrogen, and Air Products is demonstrating that hydrogen facilities globally can be carbon neutral.
"We continue to lay the groundwork for a competitive low-carbon hydrogen network, which includes increasing liquid hydrogen production capacity at our site to 35 mt/day to provide clean hydrogen for growing industrial and mobility markets across Canada."
Air Products' hydrogen output will limit greenhouse gas emissions compared with conventional diesel production. Imperial cites research that found emissions could come in 40-80% lower, which could work out as 3mn metric tons/yr of reductions across Canada's transportation sector.
Regarding the renewable diesel production system, Imperial said its manufacturing plant would apply a catalyst reaction to blue hydrogen extracted from natural gas. The blue hydrogen would be combined with biofeedstock to make diesel.
Air Products has government support from Edmonton's mayoral office, which expects the city to become a regional hydrogen hub. It also has backing from both the Alberta and federal governments.
Imperial will receive around 50% of Air Products' hydrogen output, allowing it to refine more than 1bn litres of diesel/year. A final investment decision is still to be taken on Imperial's project, and will reflect levels of government support, market conditions and economic competitiveness, Imperial said.
To facilitate the integration to Imperial's production plant, Air Products' development spend has increased to around C$1.6bn (US$1.2bn).
Imperial Oil downstream vice president Jon Wetmore said the partnership marked an important milestone for its renewable diesel plans. Wetmore added: "This project underscored Imperial's commitment to investing in a low-carbon future. We are continuing discussing with our trading partners and governments with a view to a final investment decision in the coming months."