Hydrogen: a new opportunity for oil and gas companies

Jul 28, 2021 | 2021, Blog, EFG, EFGeoBlog

It is no secret that environmental associations, NGOs and other environmentally friendly individuals express great hostility towards oil companies; this hostility is notorious. In a world that is increasingly trying to mitigate climate change, primarily by reducing and neutralizing CO2 emissions, both the profitability and even the future operation of oil and gas companies seems to be in question.

But is it really true that oil and gas companies have nothing to offer?

There is increasing discussion about the use of hydrogen as a pure energy source, but the production of hydrogen remains difficult. This is where oil and gas companies come in: their experience and existing infrastructure make them ideally placed to produce hydrogen.

Here, it is important to differentiate between the different colours of hydrogen: brown, grey, blue and green hydrogen. What do these terms mean?

Although hydrogen is a clean fuel, manufacturing it is energy intensive and emits carbon dioxide. Brown hydrogen is created through coal gasification, whereas grey hydrogen is produced from natural gas alongside the emission of carbon dioxide. Blue hydrogen is actually grey hydrogen with one big difference: the carbon dioxide emitted is captured and stored in order to prevent the emission of greenhouse gases (Figure 1). Green hydrogen originates from clean hydrogen resources that use renewable energy to create hydrogen fuel. For example, using water electrolysis to produce hydrogen requires a lot of energy, which can be produced from renewable sources.

Figure 1: Schematic of hydrogen production from hydrocarbons, in conjunction with carbon capture and storage: transfer of grey hydrogen to blue hydrogen.

The production of hydrogen in oil refineries is a well-known technique and was initiated to meet increasing demand for clean fuels and increase hydrogen conversion and treating capacity. Hydrogen is needed to convert heavy petroleum fractions into lighter products and to remove sulphur, nitrogen and metals from many petroleum fractions.

Demand for hydrogen in refineries also depends on the quality of the processed crude oil, with heavier crude oils requiring more hydrogen. Stringent specifications regarding product quality will also increase hydrogen demand (Figure 2).

Figure 2: Global demand for pure hydrogen, 1975–2018. Extracted from IEA, 2019.

The change to a lower calorific value is one of the crucial issues in hydrogen production. Theoretically, one molecule of methane should produce two molecules of hydrogen; in other words, one cubic metre of methane (calorific value: 35,818 MJ) should produce two cubic metres of hydrogen (calorific value: 2 × 10,777 MJ, or 21,554 MJ). This represents a decrease in calorific value of approximately 40%, without considering the energy consumed by the hydrogen generation unit (HGU) or any technology loss.

Each molecule of methane utilised in this process produces one molecule of CO2; this represents significant carbon emission from the HGU. To prevent this, circular methods of generation of hydrogen have already been developed, incorporating the generation of hydrogen from natural gas, carbon capture and storage involving the storage of exhaust COunderground in deep formations and further distribution of hydrogen.

It is clear that the technology required for hydrogen production is subject to certain difficulties. However, there is no doubt that these issues can be overcome using existing knowledge.

Natural hydrogen emanates from the Earth’s crust and is not particularly rare, yet direct extraction of hydrogen has not been seriously considered in the past. However, this has changed recently, because natural hydrogen could represent a truly clean source of fuel (Moretti and Webber, 2021).

In gas, condensate and oil reservoirs, hydrogen often appears in different concentrations. Possible sources of hydrogen include the thermal degradation of kerogen in source rocks, the complete destruction of hydrocarbons in high-temperature reservoirs and the emission of hydrogen from sources deep within the Earth’s crust (Barić, 2006).

natural hydrogen could represent a truly clean source of fuel

Another natural source of hydrogen is the diagenetic release of hydrogen from water; for example, ferrous iron (Fe2+) oxidizes to ferric Fe3+ and releases hydrogen when in contact with water. The same reaction can also take place between hydrogen and other metals.

Other sources of natural hydrogen include radiolysis, in which hydrogen contained in water is separated from oxygen by the natural radioactivity of the Earth’s crust. Certain bacteria also release hydrogen. Accordingly, hydrogen appears in landfill gas, generated by the decomposition of organic material in waste. Landfill gas can contain hydrogen in concentrations of 0–3% (Bilitewski et al., 1991, Milanović, 1992). It is important to note that, in all these cases, the resulting hydrogen is present as a flow and not an accumulated fossil resource. The high reactivity and small diameter of hydrogen molecules (0.23 nm) also make it difficult to concentrate hydrogen in traps, which complicates estimation of hydrogen quantities.

Despite these difficulties, natural hydrogen production has been achieved in Mali, where a well was unplugged in 2011 for use in a pilot to generate electricity for a small village. The hydrogen that comes out of the well is almost pure (more than 96%), allowing it to be burned directly in a gas turbine, and other wells have since been drilled to increase hydrogen flows (Moretti and Webber, 2021).

The business environment for oil and gas companies has become increasingly difficult, in part due to trans-national agreements and deals to reduce emissions and decarbonise industries. These developments, although they exert pressure on oil companies and their employees, represent good opportunities to adopt or develop new business models.

The application and upgrading of existing knowledge from the oil and gas sector in the production of hydrogen may not be the only solution, but it is certainly the best. Most importantly, the use of existing infrastructure (such as refineries, pipelines and depleted reservoirs) will reduce the need for investment, thus improving economic feasibility. Additionally, vast quantities of data have been compiled during many years of exploration and subsurface studies in pursuit of hydrocarbon resources. However, our greatest asset is the knowledge of those working in the oil and gas industry, which has already proven useful in Mali. We believe that this knowledge will be critical in resolving the issues that we have touched upon here.


  • Barić, G. 2006. Naftna geokemija (Petroleum Geochemistry), INA, Zagreb (in Croatian).
  • Bilitewski, B., Hrdtle, G., Marek, K. 1991. Abfallwirtschaft, Springer Verlag Berlin, Heidelberg 1991.
  • ENTSOG/GIE/Hydrogen Europe. 2021. How to transport and store Hydrogen – facts and figures.
  • Milanović, Z. 1992. Deponij – Trajno odlaganje otpada (Landfill, permanent landfilling), CGO Zagreb, May 1992.
  • Mohamed A., Fah Im, Taher A. Alsahhaf, Elkilani, A. 2010. Fundamentals of Petroleum Refining. Department of Chemical Engineering. Kuwait University. Khaideya. Kuwait, Elsevier.
  • Moretti, I., Webber, M., E. 2021. Natural Hydrogen: a Geological Curiosity or the Primary Energy Source for a Low-Carbon Future? Renewable Matter, issue #34.


Ratko Vasiljević has more than twenty years of work experience at the environmental protection company ECOINA, Zagreb, Croatia, at soil, air, surface water and groundwater protection and remediation. Since 2014, he works on the implementation of ISO 14065 standards for Greenhouse gases verification. He obtained diploma (1998) and PhD (2012) in the field of Geology and Geological Engineering at the Faculty of Mining, Geology and Petroleum engineering, University of Zagreb. In 2019 he was nominated as an Expert Witness for Geology research by the County Court in Zagreb.

Contributor: Ratko Vasiljević


Alberto Sanchez Miravalles is a Spanish Geologist with several post-grades courses in Geotechnical and Oil & Gas Engineering in Complutense and Politécnica universities of Madrid, respectively. Alberto has international experience and good skills in exploration, rock mechanics, water remediation and geotechnics. Nowadays, he is working for the European Federation of Geologists in Brussels as a project officer in charge of the management of EU projects. Besides, Alberto collaborates with the ICOG (Spanish Association of Professional Geologists), as courses developer and online teacher.

Contributor: Alberto Sanchez Miravalles

European Federation of Geologists

This article has been edited by Lynsey MacLeary (www.isotope-editing.com). 

Disclaimer: This article expresses the personal opinions of the author. These opinions may not reflect the official position of the European Federation of Geologists (EFG).