Sinopec to launch first green hydrogen production project in 2022

London (Quantum Commodity Intelligence) - China's state-owned oil company Sinopec will launch its first "green" hydrogen project in 2022 with a 10,000 mt/year system located in Inner Mongolia, according to local media reports citing Sinopec News.

The project, located in Ordos City, will have significance as a demonstration for its capability for producing the low-carbon fuel, said the company.

The oil giant is the world's biggest refiner and second-largest chemical company and has made a series of moves in the last 12 months as part of its strategy to build a strong position in the burgeoning market for hydrogen.

The company announced earlier this year plans to build 1,000 hydrogen refuelling stations or oil-hydrogen combined construction stations, 5,000 charging and swapping stations, and 7,000 distributed photovoltaic power generation stations by 2025 to create an "oil-gas-hydrogen-electricity service."

The various colours assigned to hydrogen refer to the method of production rather than the end-product, which is chemically identical no matter the process used.

Green hydrogen is produced using electricity entirely from renewable sources such as wind or solar and an electrolysis process, making it the lowest carbon-emitting way so far to produce the versatile gas.

This is compared to "blue" hydrogen which uses natural gas in a steam reforming process before capturing released carbon dioxide and storing it, usually underground (CCUS) - this is considered the next least polluting method of production.

Grey hydrogen is the same as blue hydrogen but without the CCUS process, while brown hydrogen is made directly from fossil fuel, often coal, and has the most polluting method of production.