Norway's Equinor scraps plans to export blue hydrogen to Germany
OSLO, Sept 20 (Reuters) -Norway's Equinor EQNR.OL has decided to scrap plans to export so-called blue hydrogen to Germany because it is too expensive and there is insufficient demand, a spokesperson for the energy company said on Friday.
In January 2022, Equinor and Germany's RWE RWEG.DE signed a memorandum of understanding to build a hydrogen supply chain for German power plants to help reduce emissions.
The plans included producing hydrogen from natural gas in combination with carbon capture and storage (CCS) - known as blue hydrogen - in Norway and exporting it to hydrogen-ready gas power plants in Germany via the world's first offshore hydrogen pipeline.
"The hydrogen pipeline hasn't proved to be viable. That also implies that hydrogen production plans are also put aside," Equinor's spokesperson Magnus Frantzen Eidsvold told Reuters.
"We have decided to discontinue this early phase project," he added.
RWE could not immediately be reached for comment.
Last year, Equinor CEO Anders Opedal told Reuters the cost of the total supply chain could run into the "tens of billion euros", while the pipeline alone would cost some 3 billion euros ($3.35 billion).
Eidsvold said Equinor also couldn't continue maturing the projects without firm long-term commitments from European buyers to import hydrogen.
"We are not able to make this kind of investments when we don't have long-term agreements and the markets in place," Eidsvold said.
Plans to develop hydrogen-ready gas power plants in Germany with RWE will go ahead but hydrogen for those plans will be procured on the continent, not exported from Norway, Eidsvold said.
Equinor will continue other early phase hydrogen projects, such as in the UK and the Netherlands, as well, he added.
($1 = 0.8955 euros)
Reporting by Nerijus Adomaitis; Editing by Susan Fenton
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