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JERA invests in U.S. startup to span natural hydrogen exploration through extraction

JERA has taken a stake in a U.S. company that explores for natural hydrogen, as it builds a structure to handle projects from exploration through extraction.

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JERA invests in U.S. startup to span natural hydrogen exploration through extraction
写真はイメージ / 写真: D.S. Soriano / CC BY 4.0 / Wikimedia Commons ライセンス

JERA said it has invested in a U.S. startup that explores for and extracts natural hydrogen. Through the investment, the company will be involved in a business that handles underground resource exploration through extraction in an integrated manner.

Natural hydrogen is hydrogen formed underground through chemical reactions such as those between rocks and water. Unlike hydrogen manufactured artificially, it forms naturally underground, so it may reduce the energy needed for production, which has drawn growing attention.

Hydrogen has so far been produced by reforming natural gas and by electrolysis of water. Natural gas reforming emits carbon dioxide during production, so from a decarbonization standpoint, a shift in production methods is required. If natural hydrogen is commercialized, emissions at the production stage could be reduced.

Exploration begins with analyzing geological data indicating that hydrogen exists underground and narrowing down drilling sites. Extraction requires well drilling and recovery equipment, and technologies developed in oil and natural gas development are applied. Being involved from upstream onward makes it easier to assess resources and make development decisions in-house.

JERA is an electric power company centered on thermal power generation that also handles LNG procurement and fuel businesses. It is advancing the use of hydrogen and ammonia toward decarbonization, and the investment is positioned as an effort to broaden its fuel sources.

Hydrogen use is spreading as a fuel for fuel cells and as an industrial feedstock. If supply relies heavily on production from natural gas, prices and procurement stability are likely to be affected. Moves to secure multiple production methods and supply routes are progressing in Japan and abroad, and this investment can be seen as part of that trend.

Commercialization of natural hydrogen is still in its early stages. Many points must be confirmed, including estimates of reserve size, the economics of extraction, and transport and uses after recovery. Attention will focus on the exploration results of the investee and technical assessments toward commercialization.

BLUE NOVA Hydrogen Journal view

Natural hydrogen could become a new source of hydrogen because it may reduce carbon dioxide emissions during production. However, reserve volumes and extraction economics remain unclear, and exploration results will determine the success of the business. JERA's approach of being involved from exploration through extraction is seen as a way to assess resources early and make its own commercialization decisions. The project should be watched as part of efforts to build a hydrogen supply chain combining decarbonized power and fuels, with future exploration results and technical assessments in focus.

Source: 日本経済新聞
This article was written by the editors based on the cited report and translated from Japanese. AI is used to assist in writing and translation.

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