ExxonMobil, Worley to bring low-carbon hydrogen project to Baytown

big deal

The facility in Baytown is expected to produce 28.3 million cubic meters of low-carbon hydrogen daily. Photo via exxonmobil.com

ExxonMobil selected Australia-based engineering and professional services company Worley to provide engineering, procurement and construction services for a proposed hydrogen and ammonia production facility in Baytown, which is expected to have a production capacity of 1 billion cubic feet of blue hydrogen per day. ExxonMobil expects the facility will be the largest of its kind in the world.

“We are delighted to continue our strategic, global relationship with ExxonMobil in its execution of upcoming projects, particularly in delivering this EPC project on the US Gulf Coast, which contributes significantly to strengthening Worley’s backlog,” Chris Ashton, CEO of Worley, states, according to Offshore Energy.

The facility in Baytown is expected to produce 28.3 million cubic meters (1 billion cubic feet) of low-carbon hydrogen daily and nearly 1 million metric tonnes (more than 1 million tons) of ammonia per year, which will also capture more than 98 percent of the associated CO2 emissions.

The facility will leverage advanced carbon capture and storage technologies to reduce emissions associated with hydrogen production. ExxonMobile also said its carbon capture and storage system would be available for use by third-party CO2 emitters in the area.

A final investment decision is expected in 2025 , and an anticipated startup in 2029. “Blue” hydrogen is expected to be a top energy driver in 2025 according to global consultancy Wood Mackenzie who predicts that at least three large-scale blue hydrogen projects in the U.S will reach FID by next year.

The company hopes the new facility will help in creating U.S. jobs and supporting community development initiatives throughout the Houston area, and the state.

The new initiative will take stranded natural gas and turn it into hydrogen. Photo via Getty Images

New York financial firm partners with Houston O&G co. to turn natural gas into blue hydrogen

teamwork

A new partnership between an energy and sustainability investor and a Houston-based company that focuses on cleaner solutions in the oil and gas industry will look into turning stranded natural gas into blue hydrogen.

New York-based Double Zero Holdings and SJ Environmental announced their new partnership this week in an effort to move forward the energy transition. According to the companies, stranded natural gas — mostly methane — usually remains unused where it is not economically viable to transport. By turning these gasses into into blue hydrogen, "the partnership mitigates methane and CO2 emissions while producing hydrogen—a clean fuel that could revolutionize multiple industries," reads the news release.

The initiative will use existing technologies, which can be reduced to the size of a standard shipping container, per the release.

"We're thrilled to partner with SJ Environmental to tackle one of the most pressing environmental issues today," Raja Ramachandran, managing partner of Double Zero Holdings, says in the release. "This collaboration allows us to turn stranded natural gas—a significant environmental liability—into a valuable resource, supporting the global shift toward cleaner energy."

The plan is to lower the amount of natural gas left wasted and provide a low-carbon alternative across transportation, manufacturing, and power generation.

"Our collaboration with Double Zero Holdings reflects our commitment to innovative, sustainable solutions," SJ Environmental Director John Chappell adds. "Together, we're setting a new standard for energy production, delivering hydrogen and food-grade CO₂ where natural gas would typically be flared."

Blue, green, gold — what do all the colors of hydrogen even mean? Photo via Getty Images

Hydrogen's many colors, Houston companies that are focused on it, and more

Guest column

Repeated association of specific colors in defined contexts deeply reinforces themes in the human brain. It’s why most students and alumni of Texas A&M University scoff at the sight of burnt orange, and you’d be hard-pressed to find the home of a Longhorn adorned in shades of crimson or maroon.

The color-coding of hydrogen energy production exemplifies one such ambiguous classification methodology, as the seemingly innocuous labeling of hydrogen as green (for hydrogen produced from renewable sources) and black (for hydrogen produced from coal) initially helped to quickly discern which sources of hydrogen are environmentally friendly or not.

But the coding system quickly became more complicated, as the realization that hydrogen extracted from natural gas (aka grey hydrogen) or coal (again, black hydrogen, or sometimes, brown hydrogen, depending on the carbon content and energy density of the source coal) could be extracted in a less harmful way, by introducing methods of carbon capture and storage.

These cleaner methods for hydrogen extraction earned the lofty color coding of blue, just one shade away from green in the rainbow spectrum and a safe distance from the less delightful and inspiring colors grey, brown, and black.

Then along came pyrolysis — a method for producing hydrogen through methane cracking, plainly, the decomposition of methane, CH₄, into solid carbon and hydrogen gas, without the introduction of oxygen. This method results in significantly less (if any) creation of carbon dioxide as a by-product. Logic would lead one to categorize this process with a color that lies further away from black than exalted cousin, green hydrogen.

However, the solid carbon that remains after pyrolysis retains over one-third of the original energy available from methane and could tip the GHG scales negatively if not utilized in an environmentally responsible manner, so it’s not a clear-cut winner in the game of lower-carbon energy production. Thus, it is nestled between green and blue and often referred to as “turquoise hydrogen” production.

Other hydrogen production methods — pink, purple, and red — defy rainbow logic as they have all proven to result in higher GHG emissions than the original “clean” queen, green hydrogen, despite following a similar electrolysis process to separate hydrogen and oxygen from one another in its original composition as water. The source of electricity used in the electrolysis process determines the color-code here, as pink hydrogen is generated from nuclear power, red hydrogen is generated from nuclear thermal power, and purple hydrogen is generated from a combination of nuclear power and nuclear thermal power.

Yellow hydrogen seems to not yet have found a clear definition. Some argue it refers to green hydrogen produced exclusively from solar-powered electrolysis, while others claim it to be the child of mixed green/gray hydrogen. Artists should probably keep a far distance from this conversation, unless the energy produced from the steam coming out of their ears could perform electrolysis more cleanly than any of the green hydrogen solutions.

Finally, we have white hydrogen, the naturally occurring, zero-carbon emitting, plentiful element found in the earth’s crust – which is also the least understood of all the hydrogen extraction methodologies.

Remember, hydrogen is the first element in the periodic table, meaning it’s density is very low. Hydrogen knows no bounds, and once it escapes from its natural home, it either floats off into outer space or attaches itself to another element to form a more containable compound, like water.

Many believe white hydrogen to be the unquestionable solution to a lower-carbon energy future but there is still much to be understood. Capturing, storing, and transporting white hydrogen remain mostly theoretical, despite recent progress, which includes one recently announced Houston lab dedicated to hydrogen transport. Another Houston company, Syzygy has raised millions with its light-based catalyst for hydrogen production.

For example, Cemvita, a local Houston chemical manufacturing company, predicts a future powered by gold hydrogen: white hydrogen sourced from depleted oil and gas wells. Many wildcatters believe strongly in a new era of exploration for white hydrogen using techniques refined in oil and gas exploration, including reservoir analysis, drilling, and fracking.

Without a doubt, investigating further the various hydrogen extraction theories is surely a craveable new challenge for the sciences. But perhaps the current color-coding nomenclature for hydrogen needs refinement, as well.

Unless used in the scientific context of wavelength, color-based labels represent an ambiguous classification tool, as the psychology of color depends on modern societal norms. The association of colors with the various hydrogen production methodologies does very little to distinguish the climate impact each method produces. Additionally, the existing categorizations do not consider any further distribution or processing of the produced hydrogen — a simple fact that could easily negate any amount of cleanliness implied by the various production methods — and a topic for a future article.

For now, hydrogen represents one of the front-running sources for a lower-carbon energy future, but it’s up to you if that’s best represented by a blue ribbon, gold medal, white star, or cold-hard greenbacks.

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Lindsey Ferrell is a contributing writer to EnergyCapitalHTX and founder of Guerrella & Co.

Scott Nyquist debates both sides of the hydrogen argument in this week’s ECHTX Voices of Energy guest column. Photo courtesy of Aramco.

Will 2023 be hydrogen’s year?

GUEST COLUMN

Yes and no.

Yes, because there is real money, and action, behind it.

Globally, there are 600 projects on the books to build electrolyzers, which separate the oxygen and hydrogen in water, and are critical to creating low-emissions “green hydrogen.” That investment could drive down the cost of low-emissions hydrogen, making it cost competitive with conventional fuels—a major obstacle to its development so far.

In addition, oil companies are interested, too. The industry already uses hydrogen for refining; many see hydrogen as supplemental to their existing operations and perhaps, eventually, supplanting them. In the meantime, it helps them to decarbonize their refining and petrochemical operations, which most of the majors have committed to doing.

Indeed, hydrocarbon-based companies and economies could have a big opportunity in “blue hydrogen,” which uses fossil fuels for production, but then captures and stores emissions. (“Green hydrogen” uses renewables; because it is expensive to produce, it is more distant than blue. “Gray hydrogen” uses fossil fuels, without carbon capture; this accounts for most current production and use.) Oil and gas companies have a head start on related infrastructure, such as pipelines and carbon capture, and also see new business opportunities, such as low-carbon ammonia.

Houston, for example, which likes to call itself the "energy capital of the world,” is going big on hydrogen. The region is well suited to this. It has an extensive pipeline infrastructure, an excellent port system, a pro-business culture, and experience. The Greater Houston Partnership and McKinsey—both of whom I am associated with—estimate that demand for hydrogen will grow 6 to 8 percent a year from 2030 to 2050. No wonder Houston wants a piece of that action.

There are promising, near-term applications for hydrogen, such as ammonia, cement, and steel production, shipping, long-term energy storage, long-haul trucking, and aviation. These bits and pieces add up: steel alone accounts for about 8 percent of global carbon-dioxide emissions. Late last year, Airbus announced it is developing a hydrogen-powered fuel cell engine as part of its effort to build zero-emission aircraft. And Cummins, a US-based engine company, is investing serious money in hydrogen for trains and commercial and industrial vehicles, where batteries are less effective; it already has more than 500 electrolyzers at work.

Then there is recent US legislation. The Infrastructure, Investment and Jobs Act (IIJA) of 2021 allocated $9.5 billion funding for hydrogen. Much more important, though, was last year’s Inflation Reduction Act, which contains generous tax credits to promote hydrogen production. The idea is to narrow the price gap between clean hydrogen and other, more emissions-intensive technologies; in effect, the law seeks to fundamentally change the economics of hydrogen and could be a true game-changer.

This is not without controversy: some Europeans think this money constitutes subsidies that are not allowed under trade rules. For its part, Europe has the hydrogen bug, too. Its REPowerEU plan is based on the idea of “hydrogen-ready infrastructure,” so that natural gas projects can be converted to hydrogen when the technology and economics make sense.

So there is a lot of momentum behind hydrogen, bolstered by the ambitious goals agreed to at the most recent climate conference in Egypt. McKinsey estimates that hydrogen demand could reach 660 million tons by 2050, which could abate 20 percent of total emissions. Total planned production for lower-emission green and blue hydrogen through 2030 has reached more than 26 million metric tons annually—quadruple that of 2020.

No, because major issues have not been figured out.

The plans in the works, while ambitious, are murky. A European official, asked about the REPowerEU strategy, admitted that “it’s not clear how it will work.” The same can be said of the United States. The hydrogen value chain, particularly for green hydrogen, requires a lot of electricity, and that calls for flexible grids and much greater capacity. For the United States to reach its climate goals, the grid needs to grow an estimated 60 percent by 2030.That is not easy: just try siting new transmission lines and watch the NIMBY monsters emerge.

Permitting can be a nightmare, often requiring separate approvals from local, state, interstate, and federal authorities, and from different authorities for each (air, land, water, endangered species, and on and on); money does not solve this. Even a state like Texas, which isn’t allergic to fossil fuels and has a relatively light regulatory touch, can get stuck in permitting limbo. Bill Gates recently noted that “over 1,000 gigawatts worth of potential clean energy projects [in the United States] are waiting for approval—about the current size of the entire U.S. grid—and the primary reason for the bottleneck is the lack of transmission.”

Then there is the matter of moving hydrogen from production site to market. Pipeline networks are not yet in place and shifting natural gas pipelines to hydrogen is a long way off. Liquifying hydrogen and transporting is expensive. In general, because hydrogen is still a new industry, it faces “chicken or egg” problems that are typical of the difficulties big innovations face, such as connecting hydrogen buyers to hydrogen producers and connecting carbon emitters to places to store the carbon dioxide. These challenges add to the complexity of getting projects financed.

Finally, there is money. McKinsey estimates that getting on track to that 600 million tons would require investment of $950 billion by 2030; so far, $240 billion has been announced.

Where I stand: in the middle.

I believe in hydrogen’s potential. More than 3 years ago, I wrote about hydrogen, arguing that while there had been real progress, “many things need to happen, in terms of policy, finance, and infrastructure, before it becomes even a medium-sized deal.” Now, some of those things are happening.

So, I guess I land somewhere in the middle. I think 2023 will see real progress, in decarbonizing refining and petrochemicals operations and producing ammonia, specifically. I am also optimistic that a number of low-emissions electrolysis projects will move ahead. And while such advances might seem less than transformative, they are critical: hydrogen, whether blue or green, needs to prove itself, and 2023 could be the year it does.

Because I take hydrogen’s potential seriously, though, I also see the barriers. If it is to become the big deal its supporters believe it could be, that requires big money, strong engineering and construction project management, sustained commitment, and community support. It’s easy to proclaim the wonders of the hydrogen economy; it’s much more difficult to devise sensible business models, standardized contracts, consistent incentives, and a regulatory system that doesn’t drive producers crazy. But all this matters—a lot.

My conclusion: there will be significant steps forward in 2023—but take-off is still years away.

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Scott Nyquist is a senior advisor at McKinsey & Company and vice chairman, Houston Energy Transition Initiative of the Greater Houston Partnership. The views expressed herein are Nyquist's own and not those of McKinsey & Company or of the Greater Houston Partnership. This article originally ran on LinkedIn.

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Reliant partners to expand Texas virtual power plant and home battery use

energy incentives

Houston’s Reliant and San Francisco tech company GoodLeap are teaming up to bolster residential battery participation and accelerate the growth of NRG’s virtual power plant (VPP) network in Texas.

Through the new partnership, eligible Reliant customers can either lease a battery or enter into a power purchase agreement with GoodLeap through its GoodGrid program, which incentivises users by offering monthly performance-based rewards for contributing stored power to the grid. Through the Reliant GoodLeap VPP Battery Program, customers will start earning $40 per month in rewards from GoodLeap.

“These incentives highlight our commitment to making homeowner battery adoption more accessible, effectively offsetting the cost of the battery and making the upgrade a no-cost addition to their homes,” Dan Lotano, COO at GoodLeap, said in a news release.“We’re proud to work with NRG to unlock the next frontier in distributed energy in Texas. This marks an important step in GoodLeap reaching our nationwide goal of 1.5 GW of managed distributed energy over the next five years.”

Other features of the program include power outage plans, with battery reserves set aside for outage events. The plan also intelligently manages the battery without homeowner interaction.

The partnership comes as Reliant’s parent company, NRG, continues to scale its VPP program. Last year, NRG partnered with California-based Renew Home to distribute hundreds of thousands of VPP-enabled smart thermostats by 2035 in an effort to help households manage and lower their energy costs.

“We started building our VPP with smart thermostats across Texas, and now this partnership with GoodLeap brings home battery storage into our platform,” Mark Parsons, senior vice president and head of Texas energy at NRG, said in a the release. “Each time we add new devices, we’re enabling Texans to unlock new value from their homes, earn rewards and help build a more resilient grid for everyone. This is about giving customers the opportunity to actively participate in the energy transition and receive tangible benefits for themselves and their communities.

How Corrolytics is tackling industrial corrosion and cutting emissions

now streaming

Corrosion is not something most people think about, but for Houston's industrial backbone pipelines, refineries, chemical plants, and water infrastructure, it is a silent and costly threat. Replacing damaged steel and overusing chemicals adds hundreds of millions of tons of carbon emissions every year. Despite the scale of the problem, corrosion detection has barely changed in decades.

In a recent episode of the Energy Tech Startups Podcast, Anwar Sadek, founder and CEO of Corrolytics, explained why the traditional approach is not working and how his team is delivering real-time visibility into one of the most overlooked challenges in the energy transition.

From Lab Insight to Industrial Breakthrough

Anwar began as a researcher studying how metals degrade and how microbes accelerate corrosion. He quickly noticed a major gap. Companies could detect the presence of microorganisms, but they could not tell whether those microbes were actually causing corrosion or how quickly the damage was happening. Most tests required shipping samples to a lab and waiting months for results, long after conditions inside the asset had changed.

That gap inspired Corrolytics' breakthrough. The company developed a portable, real-time electrochemical test that measures microbial corrosion activity directly from fluid samples. No invasive probes. No complex lab work. Just the immediate data operators can act on.

“It is like switching from film to digital photography,” Anwar says. “What used to take months now takes a couple of hours.”

Why Corrosion Matters in Houston's Energy Transition

Houston's energy transition is a blend of innovation and practicality. While the world builds new low-carbon systems, the region still depends on existing industrial infrastructure. Keeping those assets safe, efficient, and emission-conscious is essential.

This is where Corrolytics fits in. Every leak prevented, every pipeline protected, and every unnecessary gallon of biocide avoided reduces emissions and improves operational safety. The company is already seeing interest across oil and gas, petrochemicals, water and wastewater treatment, HVAC, industrial cooling, and biofuels. If fluids move through metal, microbial corrosion can occur, and Corrolytics can detect it.

Because microbes evolve quickly, slow testing methods simply cannot keep up. “By the time a company gets lab results, the environment has changed completely,” Anwar explains. “You cannot manage what you cannot measure.”

A Scientist Steps Into the CEO Role

Anwar did not plan to become a CEO. But through the National Science Foundation's ICorps program, he interviewed more than 300 industry stakeholders. Over 95 percent cited microbial corrosion as a major issue with no effective tool to address it. That validation pushed him to transform his research into a product.

Since then, Corrolytics has moved from prototype to real-world pilots in Brazil and Houston, with early partners already using the technology and some preparing to invest. Along the way, Anwar learned to lead teams, speak the language of industry, and guide the company through challenges. “When things go wrong, and they do, it is the CEO's job to steady the team,” he says.

Why Houston

Relocating to Houston accelerated everything. Customers, partners, advisors, and manufacturing talent are all here. For industrial and energy tech startups, Houston offers an ecosystem built for scale.

What's Next

Corrolytics is preparing for broader pilots, commercial partnerships, and team growth as it continues its fundraising efforts. For anyone focused on asset integrity, emissions reduction, or industrial innovation, this is a company to watch.

Listen to the full conversation with Anwar Sadek on the Energy Tech Startups Podcast to learn more:

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Energy Tech Startups Podcast is hosted by Jason Ethier and Nada Ahmed. It delves into Houston's pivotal role in the energy transition, spotlighting entrepreneurs and industry leaders shaping a low-carbon future.

Investors close partial acquisition of Phillips 66 subsidiary with growing EV network

M&A activity

Energy Equation Partners, a London-based investment firm focused on clean energy companies, and New York-based Stonepeak have completed the acquisition of a 65 percent interest in JET Tankstellen Deutschland GmbH, a subsidiary of Houston oil and gas giant Phillips 66.

JET is one of the largest and most popular fuel retailers in Germany and Austria with a rapidly growing EV charging network, according to a news release. It also operates approximately 970 service stations, convenience stores and car washes.

“We are delighted to complete this acquisition and to partner with Stonepeak and Phillips 66 to take JET to the next level,” Javed Ahmed, managing partner of Energy Equation Partners, said in a news release. “This investment reflects EEP’s commitment to investing in established players in the energy sector who have the potential to make a meaningful impact on the energy transition, and we are excited to work alongside the entire JET team, including its dedicated service station operators, to realize this vision.”

The deal values JET at approximately $2.8 billion. Phillips 66 will retain a 35 percent non-operated interest in JET and received about $1.6 billion in pre-tax proceeds.

“Under Phillips 66’s ownership, JET has grown into one of the largest fuel retailers in Germany and Austria," Anthony Borreca, senior managing director and co-head of energy at Stonepeak, added in a news release. "We are excited to join forces with them, as well as Javed and the EEP team, who have long-standing experience investing in and operating retail fuel distribution and logistics globally, to support the next phase of JET’s growth.”

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