Norwegian Equinor cancels project to export blue hydrogen to Germany

Plans to export blue hydrogen from Norway to Germany via an undersea hydrogen pipeline are a thing of the past. Norway’s Equinor has scrapped the project due to high costs and insufficient demand for hydrogen. Reuters reported.

Germany is among the countries planning to rely heavily on hydrogen in its efforts to decarbonise. According to the country’s National Hydrogen Council, demand for hydrogen in Germany is expected to reach 94 to 125 TWh in 2030 and rise to 620 to 1,288 TWh by 2045. Industry is expected to drive demand initially. The power and district heating sectors are also expected to join after 2040.

In July this year, the German government adopted its long-awaited strategy for importing hydrogen and its derivatives. It envisages imports of 45 to 90 TWh a year in 2030, followed by further growth. The strategy does not rely solely on imports of green hydrogen produced by electrolysing water using electricity from renewable sources, but also on blue hydrogen, which is produced from natural gas using technologies to capture and store CO2 emissions.

According to the published strategy, hydrogen and its derivatives would be imported both by sea and through pipelines. One of the pipelines that was expected to start carrying hydrogen to Germany by 2030, initially blue and later green, was a hydrogen pipeline from Norway.

High costs, low demand

Norwegian company Equinor announced last week, however, that it was scrapping the project due to excessively high costs and insufficient demand for hydrogen.

"The hydrogen pipeline has not been shown to be economically viable. This also means that the plans to produce hydrogen have been scrapped," Equinor spokesperson Magnus Frantzen Eidsvold told Reuters.

Eidsvold added that Equinor cannot bring similar projects closer to implementation without firm commitments from potential hydrogen buyers.

"We cannot make these investments without long-term contracts and an established market," Eidsvold said.

An alternative to the cancelled project could be producing blue hydrogen from Norwegian natural gas in the Netherlands and transporting the captured CO2 emissions back to Norway for storage. According to Reuters, this option will be explored following intensive talks between Germany and Norway on the cancelled project.