TotalEnergies and Tree Energy Solutions (TES) have agreed to jointly study and develop a large-scale e-natural gas (eNG) production facility in the United States. E-natural gas is a synthetic gas produced from renewable hydrogen and CO2.
The project, which is expected to produce 100,000 to 200,000 metric tons of e-NG per year, will be equally owned by the partners and operated by TotalEnergies, TotalEnergies said in its statement. This partnership combines TES’ e-NG know-how with TotalEnergies’ expertise in renewable power generation, large-scale project management, and natural gas liquefaction.
The e-NG will be produced in two steps, TotalEnergies says. In the first step, the partners aim to produce renewable hydrogen by a one-gigawatt (GW) electrolyzer that will be powered by approximately 2GW of wind and solar energy supplied by TotalEnergies through long-term power purchase agreements (PPAs). In the second step, this renewable hydrogen will then be combined with biogenic CO2 to obtain the e-NG.
The resulting e-NG produced can be transported and/or liquefied, then sold like natural gas, using existing infrastructure, and end customers will be able to use it without any adaptation to their facilities, the statement reads.
TotalEnergies and TES will carry out the preliminary studies and aim to reach a Final Investment Decision (FID) in 2024. The project is expected to benefit from tax credits under the 2022 Inflation Reduction Act (IRA).
“We are pleased to partner with TES to pioneer the development of the e-NG industry. This synthetic fuel will contribute to the energy transition by helping our customers to decarbonize their activities, notably the ones that are difficult to electrify. This product presents two significant advantages. First, it does not require any new logistical infrastructure since e-NG and natural gas have the same properties and can therefore be mixed in existing infrastructures. Second, our customers will not have to change their current industrial processes,” said Stéphane Michel, President, Gas, Renewables & Power at TotalEnergies.
“The United States has many advantages for the development of our first e-NG project, including well-developed gas infrastructure, growing renewable power generation capacity, and significant public subsidies”.
“The strategic cooperation with TotalEnergies is an important milestone towards large-scale e-NG production,” said Marco Alverà, Chief Executive Officer of TES.
“Our purpose and vision are to accelerate the race to zero emissions and the development of hydrogen. The innovative business model developed by TES will help to diversify the European and Asian energy mix, making affordable renewable energy available. This groundbreaking project testifies to the effectiveness of the Inflation Reduction Act (IRA) in the United States. Today’s announcement confirms that cooperation among all players is what will make the energy transition possible,” he added.
The partnership with TES is in line with TotalEnergies’ plans to get to net zero. In early 2019, TotalEnergies announced its aim to reduce emissions from its operated facilities to less than 40 Mt by 2025 and set itself the target of cutting Scope 1&2 net emissions (including carbon sinks) for its operated activities.
In order to prepare for the decline in demand for oil by the end of the decade, the company states on its site that it has embarked on a voluntary strategy of adapting its downstream activities in the refining and distribution of petroleum products to align them with its oil production and that it has set itself a new target of lowering Scope 3 emissions from petroleum products sold worldwide by over 30 percent between 2015 and 2030.
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