18.01.22 The backbone of decarbonization Interview with Nina Scholz • Reading time: 4 min.

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Equinor is Europe's largest producer of natural gas. It extracts around 80 billion cubic meters of gas every year from the Norwegian North Sea, supplying consumers throughout central Europe and covering between 20 and 25 percent of the European demand for natural gas. Equinor is planning to contribute to the energy transition and to the establishment of a hydrogen economy by producing blue hydrogen, as Nina Scholz, Country Manager Germany at Equinor Deutschland, explains in this interview.

Nina Scholz, Country Manager Germany at Equinor Deutschland

What role will blue hydrogen play for Equinor in the future?

Together with green hydrogen, blue hydrogen will be the backbone of the decarbonization of carbon-intensive industries. Equinor is ready to support this transition by providing our experience and our production capacity. The advantage of blue hydrogen is that it can be produced quickly and on a large scale using existing technology and is always available. It can help the hydrogen economy to take off and then be supplemented by green hydrogen. We are already taking part in a number of hydrogen projects across Europe to get the market up and running.

How much experience does Equinor have of blue hydrogen?

Equinor is involved in many projects and these are demonstrating that the production process for blue hydrogen is scalable and can supply a low-carbon fuel. We also have 25 years' experience of carbon storage in Sleipner. This is the key technology for blue hydrogen. In the "Northern Lights" project, which will begin in 2024, we will be working with Shell and Total Energies to transport CO2 for the first time on a large scale directly from the production sites of our industrial partners throughout Europe by ship to Norway, where it will be stored safely under the North Sea. In the first phase of the project, we will be storing up to 1.5 million metric tons of CO2 per year. At a later date, we will be able to expand the capacity. Our goal is to be able to store between 15 and 30 million metric tons per year under the seabed by 2035 and supply three to five industrial clusters with climate-friendly hydrogen.

You say that CO2 storage is the key technology for the use of blue hydrogen, but in the past the German people have had major reservations about this. What is your response to the critics and skeptics?

The main criticisms are that CO2 storage is not safe and not necessary and that there is not enough capacity. Let's look first at safety. As part of the Sleipner project that I have already mentioned, Equinor has already stored more than 20 million metric tons of CO2 without problems over the last 25 years. The storage facility is very closely monitored and this will continue even after all the capacity has eventually been used. We make all the data available to third parties to ensure that we are fully transparent. Moving on to whether this is necessary or not, the scientists, including the Intergovernmental Panel on Climate Change (IPCC) and the International Energy Agency (IEA), agree that climate neutrality will only be possible with the help of CO2 storage. And the capacity is available. The storage potential of the North Sea alone is estimated to be 160 gigatons, which is enough to hold the current CO2 emissions of European industry for 75 years.

It is often claimed that blue hydrogen is not climate-friendly because methane is emitted during production and distribution. What do you say to this?

The studies that have given rise to this criticism base their conclusions on assumptions about the upstream methane emissions and separation rates in reformers that do not reflect the reality in current European projects. To give you one example: there are studies that base their results on methane emissions of more than three percent. In fact, the figure for natural gas extraction on the Norwegian Continental Shelf is 0.03 percent. The CO2 separation rate is also much higher in reality than is assumed in these studies, because the technology is constantly being developed and improved. Our hydrogen projects are based on ultra-modern, highly efficient reformers with a separation rate of around 95 percent. We have never considered using processes with a footprint in our projects, as many of the critical studies assume. We are very aware that the acceptance of blue hydrogen depends heavily on the extent of the small amount of remaining emissions and the trust in the data. This is why we are calling for clear criteria and the standardization of the greenhouse gas footprint of blue hydrogen along the value chain.

What benefits will blue hydrogen from Norway bring for Europe?

It will give us security of supply, together with a minimal impact on the climate. That is precisely what Europe needs at the moment, because the energy-intensive industries require reliable and highly scalable solutions for their transformation. Both the messages given out by politicians and the available technologies have to be brought into line with the investment cycles, otherwise we risk experiencing carbon leakage. Blue hydrogen is available around the clock and can be produced in large quantities. This means that it can be used to kick start the hydrogen market and will lead to investments in infrastructure to enable us to achieve our climate targets on schedule. We believe that the hydrogen economy can only take off successfully if all the stakeholders are pulling in the same direction and we want to contribute our experience so that this can happen as quickly as possible.

How does a major gas producer like Equinor handle the goal of greenhouse gas neutrality?

Equinor has set itself the target of becoming climate neutral by 2050, including the emissions from production and end consumption. We are making a considerable effort to reduce the CO2 emissions from oil and gas extraction. For example, we are electrifying our production platforms so that in the future we will no longer be dependent on the direct generation of electricity from gas. Our floating offshore wind farm Hywind Tampen will come on stream in 2022 and supply five platforms with a total of 88 megawatts of green electricity. In addition, we are constantly reducing the methane emissions from our production process. We are putting the emphasis on developing renewable energies and investing in hydrogen and CO2 storage while we transition our business to net zero emissions. Among other things, we are planning to invest more than 20 billion euros in installing between 12 and 16 gigawatts of renewable energy generation by 2030.

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