Essar Group to invest $3.6 billion on hydrogen production and decarbonization in UK, India
(Bloomberg) — Essar Group plans to spend as much as $3.6 billion on low-carbon hydrogen production in the UK and India, as well as decarbonization work at its refinery in northwest England, pending government support.
The company’s first step would be a $1.2 billion investment in Britain to produce hydrogen from natural gas with carbon capture and storage, according to Prashant Ruia, director of Essar Capital. A final investment decision is expected later this year, he said by phone.
Essar is seeking to capitalize on efforts by British industries to cut emissions as the UK strives to reach net zero by the middle of the century.
The company’s Stanlow refinery is connected to the Hynet project, one of two industrial clusters selected by the government to get funding to capture CO2 emissions and transport them for permanent storage below the seabed. The UK aims to capture 20-30 million metric tons of carbon a year by the early 2030s.
Ruia said he expects the UK to finalize a market framework later this year, which would allow the company to make a firm commitment so that its first project can be operational by 2027.
The hydrogen produced by Essar would be used at Stanlow and sold to other nearby industrial companies. Future investments would go to cutting emissions at the refinery, and a hub in India to produce hydrogen from renewable electricity. The gas would then be turned into ammonia for export to the UK and Europe.