Equinor, VNG to partner on low-carbon hydrogen hub in Rostock

Norway’s Equinor ASA (NYSE:EQNR) and German gas company VNG AG have agreed to explore a joint project for the industrial-scale production of low-carbon hydrogen and ammonia in Rostock on the Baltic Sea coast as well as direct imports from Norway for the German hydrogen market.

Under the partnership, a gigawatt-scale plant will be built in the German port city which will produce between 8 TWh and 9 TWh of low-carbon hydrogen per year, VNG said on Monday.

The carbon dioxide emitted during hydrogen production will be captured, utilised or transported and stored offshore, cutting the carbon footprint in the process by more than 95% as compared to hydrogen without CO2 capture and storage.

The joint project is expected to create a hydrogen hub in the area of Rostock and lead to the development and repurposing of up to 400 km pipeline for hydrogen between Rostock, Berlin and industrial clusters around Leipzig, in eastern Germany.

It will also make low-hydrogen available for hard-to-abate industries, complementing the increasing green hydrogen supply.

The deal between Equinor and VNG aligns with the energy partnership between Germany and Norway. In March, the two countries announced they were considering building a hydrogen pipeline that would enable hydrogen imports from the Scandinavian country to Europe's largest economy. The use of blue hydrogen is considered an option for a transitional period as a means of accelerating the development of green hydrogen and rapidly realising high-volume imports.

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