Sinopec and BHI Tianjin Ink Green Hydrogen Supply Deal in China, Featuring 100,000 TPA Production and Hydrogen Blending Pilots

HKEXnews (Hong Kong Exchanges and Clearing Limited) China

Overview

Sinopec Star New Energy Company and BHI Tianjin have signed a framework agreement for green hydrogen supply, marking a significant step for China’s hydrogen infrastructure. Sinopec will establish a 100,000 tons per annum green hydrogen production facility in Ulanqab, Inner Mongolia, and build a long-distance dedicated hydrogen pipeline to Tianjin. BHI Tianjin will then integrate this green hydrogen into its natural gas pipeline network, with blending trials scheduled from 2026 to 2028 to develop technical standards. This collaboration aims to accelerate large-scale hydrogen integration into China’s energy system.

In Depth

Background: China’s Hydrogen Energy Strategy and Natural Gas Network Utilization

China is nationally committed to developing and deploying hydrogen energy as part of its broader strategy to reduce carbon emissions and enhance energy security. A critical priority is establishing a supply chain for large-scale green hydrogen production in renewable-rich regions like Inner Mongolia, and its subsequent transportation to major industrial hubs and urban centers. Utilizing existing natural gas pipeline networks for hydrogen transport is considered a key strategy to reduce the cost and time associated with new infrastructure development, thereby enabling a faster transition to a hydrogen economy. However, blending hydrogen into natural gas pipelines necessitates careful consideration of existing pipeline and consumer equipment compatibility, safety protocols, and the establishment of technical standards for varying blending ratios.

Key Agreement Details and Project Plan

Sinopec Star New Energy Company, a subsidiary of the Chinese energy giant Sinopec, has entered into a significant framework agreement for green hydrogen supply with BHI Tianjin. Under this agreement, Sinopec plans to construct a large-scale green hydrogen production facility in the Ulanqab (Wulanchabu) region of Inner Mongolia, with an impressive annual production capacity of 100,000 tons. From this production site, a new long-distance dedicated hydrogen pipeline will be built to Tianjin, ensuring efficient hydrogen transportation. BHI Tianjin will then receive this pure green hydrogen and be responsible for blending it into the existing natural gas pipeline network within Tianjin city. This hydrogen blending pilot phase is scheduled to run from 2026 to 2028, with the primary objective of developing appropriate technical standards and operational guidelines for hydrogen integration.

Technical Significance and Future Outlook

The agreement between Sinopec and BHI Tianjin holds immense technical significance as a model for large-scale hydrogen infrastructure deployment and hydrogen integration into existing energy networks within China. The production scale of 100,000 tons of green hydrogen annually places it among the top global projects, and the construction of a dedicated long-distance hydrogen pipeline for this volume represents a critical milestone in China’s hydrogen infrastructure development. Furthermore, blending hydrogen into natural gas pipelines is a pragmatic approach to create initial hydrogen demand and accelerate decarbonization by leveraging existing infrastructure. However, high-ratio hydrogen blending poses technical and safety challenges, including potential material degradation of pipelines, impacts on combustion equipment like gas turbines, and leakage risks. Data gathered during the Tianjin pilot operation will provide crucial insights for resolving these challenges and for future nationwide hydrogen blending initiatives. This project is expected to be a powerful catalyst for China’s establishment of a hydrogen economy and acceleration of its energy transition.