BP, Linde to develop Gulf Coast CCS project to decarbonize hydrogen production

BP and Linde are joining forces to develop a major carbon capture and sequestration project along the Texas Gulf Coast that will store up to 15 million mt/year of CO2 while producing low-carbon hydrogen, the companies said in a joint statement May 17.

Slated for completion by 2026, the project will capture and store CO2 from Linde's existing hydrogen production facilities in the greater Houston area with the potential to also store carbon from Linde's other Texas facilities. The project will allow Linde, a world leader in hydrogen production and hydrogen liquefaction technology, to sell low carbon hydrogen to customers along its pipeline network under long-term contracts, the statement said.

The CCS component will boost the value of Linde's hydrogen products. According to price assessments from S&P Global Commodity Insights, the cost of grey hydrogen produced on the Gulf Coast cost $1.74/kg (including capital expenditures) May 16, whereas blue, or low carbon, hydrogen cost over $2/kg with Henry Hub natural gas prices around $8/MMBtu.

Under the agreement, BP will develop and permit geologic storage sites for permanent storage of Linde's captured CO2 as well as bring other low-carbon solutions to the project, like renewable power and certified natural gas. CO2 storage is expected to occur at multiple sites.

BP America Chairman and President Dave Lawler said that the project will utilize Texas' strong supply chains to decarbonize hard-to-abate industries "for the greatest potential impact on emissions while protecting jobs," according to the statement.

In addition to reducing the carbon intensity of Linde's hydrogen operations, the CCS project will also support CO2 removal and storage from other industrial emitters in the Texas Gulf Coast industrial corridor. According to the Energy Information Administration, Texas has some of the highest levels of CO2 emissions in the US at around 700 million mt/year owing in large part to emitters within the industrial corridor.

Linde and BP's CCS project could reduce that total by roughly 2%.

In 2020, BP set a 2050 net-zero goal for its scope 1 and scope 2 emissions—those directly associated with a company's operations and energy use. Linde has a similar goal of net-zero scope 1 and 2 emissions by 2050, with an interim target to reduce emissions by 35% by 2035.

"Linde is committed to lowering absolute carbon emissions by 35% by 2035 and reaching climate neutrality by 2050," Linde President Dan Yankowski said in the statement. "Capturing the CO2 from our hydrogen production plants in the Houston area will be a significant step towards achieving these goals."

Yankowski also said that Linde is in a position to enable similar low carbon projects in the Gulf Coast or elsewhere in the US where the company operates hydrogen pipelines or storage caverns.

According to S&P Global, the assessed price of tech carbon capture credits—a basket assessment that reflects credits issued by a range of technology projects that remove emissions—was $141/mt of CO2e in the voluntary carbon market as of May 17. Tech carbon credit prices have been on a steady incline since late March after falling from a peak of $170/mt in January.