13 minute read
Newfound sense of pragmatism reshapes oil and gas decarbonisation
Newfound sense of pragmatism reshapes oil and gas
decarbonisation
Security of supply and cost of energy join emissions reduction as key drivers in the journey to net zero, says James Richardson, commercial director for UK industrial decarbonisation at Baker Hughes
The oil and gas decarbonisation debate has shifted in a more pragmatic direction during the past 12 months, largely in reaction to geopolitics and increasing anxiety over security of supplies.
Projects that were previously on hold, or that had limited late-life options, are back in play thanks to the improved economics of higher prices and the urgent need for alternative producers of energy – particularly gas.
There is also increased acceptance in society that gas is an essential transition fuel, displacing coal and oil as part of the net-zero journey and underpinning industry eff orts to make signifi cant carbon emission cuts in the near to medium term.
Technology, innovation and expertise are enabling the changes required – from sequestration to subsea infrastructure, hydrogen production, electrifi cation and fl are management, among other solutions.
Sweating assets
Reducing emissions for existing projects, and safeguarding or even extending operational lifetimes, are the immediate challenges for the oil and gas sector – made more acute by ageing infrastructure in areas such as the North Sea.
Electrifi cation is seen as the solution for many, whether in the shape of power from shore or co-located renewables such as fl oating wind. Clustered fi elds and other ‘crown jewel’ assets are likely to be the main benefi ciaries, given the level of investment necessary.
Subsea technology companies will enable the development of off shore grids, connecting renewable off shore power, onshore supply and existing generating assets to decarbonise the power requirements of off shore infrastructure, including processing, dynamic cabling, pipelines and umbilicals, remote power infrastructure and electric components, among others.
Hydrogen could also play a role. Using non-hydrocarbon fuels in the gas turbines
often used to power oil and gas infrastructure will be particularly important in regions where vulnerable or high-carbon onshore grids rule out clean, reliable electrifi cation. Flaring and methane emissions from existing assets are another area of focus, with industry committed to reduction towards zero in both areas. More eff ective measurement, management of fl ares – think optimal destruction effi ciency – and leak detection will play their part. Baker Hughes believes technologies such as fl are. IQ and Lumen are part of the solution.
New horizons
There are many hard-to-abate sectors across our economies. Among them are some oil and gas operations, in particular ageing infrastructure or nearer production cessation dates that have limited options for electrifi cation investment. Negative emissions technologies will also be crucial. Carbon scrubbers, including direct air capture, could be central to addressing these types of emissions.
Carbon capture, utilisation and storage (CCUS) is essential. Collection, transport and storage – as well as installation – each pose their own challenges, but the component technologies are largely in place and proven. CCUS can, importantly, transform Scope 3 emission profi les for operators both at the point of production and consumption.
Newbuild gas projects, meanwhile, have the relative luxury of embedding marketchanging emission reduction technologies from day one. These will often rely on advances proven in the subsea sector and, increasingly, fl oating installations.
Dynamic cabling, complex subsea power infrastructure, pipelines, off shore grids – all will combine to lower the carbon footprint of projects during fabrication and construction, and keep it optimised during operational lifetimes.
Gas will, of course, dovetail with, and contribute to, parallel developments in adjacent sectors: production of hydrogen the right time, to make the most immediate impact – across existing and future assets, and accepting the key role gas will play.
Success will come. It is a matter of understanding the size of the challenges ahead, taking the pragmatic steps that will be necessary to reach our goals, and having the will to achieve change at an acceptable price and without disrupting energy access. And the experience and expertise of industry will make all the diff erence.
and ammonia fuels, global transport infrastructure, expansion of deep-water and marine renewables, integration with CCUS, energy storage.
Removing carbon across multiple sectors demands a multi-pronged approach. To this end, Baker Hughes has acquired Mosaic Materials to further develop and scale its direct air capture technology, and invested in Ekona for turquoise hydrogen through pyrolysis, in NetPower with its Allam-cycle combined-cycle gas turbine technology, and the synthetic natural gas production developed by Electrochaea.
The carbon-emissions associated with future production will, as a result, be lower than those associated with current production; both the construction and operational emissions (Scope 1 especially) as well as the Scope 3 emissions associated with society’s consumption of the energy.
Recipe for success
The energy landscape is shifting as supply and cost concerns drive increased public acceptance that the low-carbon transition is a journey rather than an on/off switch. That does not, however, reduce the size of the hurdles ahead. If anything, it multiplies what will be necessary to meet the tripleheaded challenge of carbon reductions, energy security and rising costs.
The technologies necessary to achieve the energy transition exist, but we need to deploy those advances in the right way, at
Towards net-zero operations
Oil and gas: there is no single pathway to achieve a lower carbon future
Energy effi ciency
Platform electrifi cation
Mitigation of fl aring and venting
Mitigation of methane leaks
CCUS
Hydrogen
Subsea production systems
Invest in renewables
Switch to gas
The technologies necessary to achieve the energy transition exist, but we need to deploy those advances in the right way, at the right time, to make the most immediate impact – across existing and future assets
By James Richardson, Commercial Director for UK Industrial Decarbonisation, Baker Hughes
Advertising feature
What is needed to scale up hydrogen?
Thorsten Harder, Product Manager at Burckhardt Compression, off ers his thoughts on what is required to scale up hydrogen so that it may play a greater role in decarbonising key industrial processes
A strong energy mix is critical to ensuring the world can meet both energy security and sustainability demands simultaneously.
Technology advances in solar and wind and enhanced effi ciencies in more traditional forms of energy generation are contributing to these goals, yet all component parts must continue to evolve if we are to be successful. That, undoubtedly, includes the successful harnessing of new energy sources such as hydrogen.
“Hydrogen today is already used in diff erent industries,” explains Thorsten Harder, Product Manager at Burckhardt Compression – the worldwide market leader for reciprocating compressor systems. “This includes refi neries and the chemical industry, gas production for semiconductor manufacturing and, of course, fertiliser production.”
At present, natural gas, coal and oil provide the majority of energy for many such industrial processes that, combined, are responsible for approximately 20% of global emissions.
If used optimally, hydrogen has incredible potential to decarbonise these industries and the transportation sector. Indeed, it is a versatile and clear fuel that can be stored and transported at high energy density in liquid or gaseous form and produces zero emissions at the point of use.
However, the challenge today is that the majority of hydrogen is grey, meaning it has been created from carbon-abated fossil fuels.
According to the European Commission, 96% of hydrogen production is powered by natural gas. Furthermore, the International Energy Agency (IEA) reports that hydrogen production is currently responsible for 830m tonnes of CO2 emissions per year – the equivalent of the annual carbon emissions of the UK and Indonesia combined.
Moving from grey to green
Clearly, at present, hydrogen is not as clean as it can be. So, how can we improve its viability as a sustainable fuel moving forward?
“The easiest way to decarbonise these industries is with greener production processes,” Harder explains. “This is commonly achieved in two ways. One, you use electrolyser-produced green hydrogen, or two, you can try to capture the CO2 coming from the steam methane reformers and store it permanently deep underground (blue hydrogen).”
Indeed, these methods are beginning to gather momentum. The IEA further reveals that in the past two decades, more than 200 projects have started operation to either convert electricity and water into hydrogen to reduce emissions, or support the integration of renewables into the energy system.
“There is no chicken and egg problem with hydrogen for decarbonising heavy industry,” Harder continues. “When it comes to hydrogen as fuel for heavy vehicles, it is much more challenging. But for industry we have demand, we have a way of producing hydrogen to guarantee supply... we just need to change the way of producing hydrogen to reduce the greenhouse gases that are produced or released. That’s the easiest way to decarbonise quickly.”
Green hydrogen is key to making hydrogen a more viable energy transition fuel long term, although journeying down this route poses a diff erent challenge.
“Accessing green hydrogen is highly dependent on location and infrastructure,” Harder explains. “If you’re close to the product site, you may only need a small pipeline. However, for distances of a few hundred kilometres or more, it’s more economical to transport compressed gaseous hydrogen by road using trucks and pressurised tube trailers.
Harder then turns his attention from access to production, outlining similar challenges. “You can produce ‘green’ hydrogen from electrolysers, of course. But it’s diffi cult when you have limited renewable resources close to the site where you need it. In Switzerland, for example, we don’t have a lot of solar and wind. We may have hydropower, but if you want to extend the capacity on green hydrogen in Switzerland, it’s not so easy.”
There are work arounds available. Pyrolysis technology can be used to convert natural gas into ‘turquoise’ hydrogen without emitting CO2 – yet this is a technology that remains in its infancy.
Of course, these developments are promising, highlighting the increasing
support of the hydrogen economy in making hydrogen a viable fuel source. However, for Harder, the priority needs to be focused on establishing key production centres that the entire sector can then begin to scale from.
“We’re already using huge amounts of hydrogen at refi neries, in ammonia plants, and other industrial applications,” he explains. “Here, you have a constant demand for hydrogen. If you can make that hydrogen green, then you can begin to create desirable hydrogen epicentres in clusters from which the rest of the hydrogen economy may develop.”
Opportunities, barriers and the importance of compression technologies
Several studies are being explored that could see hydrogen clusters become established.
Harder points to promising investigations into producing hydrogen at off shore wind parks with dedicated off shore platforms that are built to accommodate electrolysers and feed into storages. In the Netherlands, for example, Vattenfall has proposed to build the world’s fi rst off shore green hydrogen cluster that would see the integration a 45 MW hydrogen cluster into an off shore wind farm, with three turbines equipped with electrolysers.
“Producing electricity off shore, bringing it onshore and transferring it through high voltage power lines is more costly and less effi cient than feeding hydrogen into a pipeline and then using repurposed natural gas pipes,” Harder affi rms.
Functioning cross-border energy infrastructure such as this will be critical. According to the Hydrogen Council, approximately 30% of global primary energy supply is currently traded internationally – a need that will persist with the capacity of renewable energy production varying wildly between countries.
Indeed, some countries like the UK are planning to develop a ‘hydrogen backbone’ that would see gas transmission pipelines repurposed to link industrial clusters domestically. However, if an international trade network is to become consolidated, the lack of liquidity in the hydrogen market must be addressed.
“Right now, we only have point-to-point trading between molecule producers and customers,” Harder explains. “There isn’t really a hydrogen market that has been established yet. But for hydrogen to work, we would need to have some sort of free trade and transportation policies of the molecules within key regions. Not only that, but we also need aligned emission regulations and aligned CO2 costs.”
Technologies also need to continue to evolve to make hydrogen more of a commercially viable reality for many – an area where several promising developments are being pursued.
The ongoing improvement of compression technologies stands as a prime example, as Harder explains: “Compression solutions play a very important role. It doesn’t matter which format you want to use hydrogen – from liquefi ed hydrogen to gaseous hydrogen, you need compressors.
A European outlook
Indeed, it is safe to say there are plenty of challenges and opportunities ahead – particularly when looking at the European market.
Owing to areas of dense populations, the expansion of renewable energies into these places is a major social challenge on the continent. For this reason, the World Economic Forum outlines that the region will remain an energy importer, focused on building a strong and interconnected grid infrastructure while also improving its powerful technology position.
Recent moves from Germany show some logic here. Indeed, the country has signed several global agreements as it moves aggressively towards importing hydrogen products, technologies and capabilities from global players including the UAE, India, Japan and Scotland.
Generally speaking, however, there is still a long road ahead in establishing a more eff ective and expansive hydrogen economy on the continent.
“I think we are at the very beginning,” Harder muses, concluding with his forecasts for the future. “However, we have major subsidies and proven feasibility studies on our side now, and I think we’re poised for lift off – a lot of things are now conceptually worked out.
For more information, contact:
Tel: +41522615500 E: info@burckhardtcompression.com W: www.burckhardtcompression.com
