BP today unveiled its plans to create what it believes would be the UK’s largest “blue” hydrogen production facility in the Tees Valley.

A feasibility study is currently taking place into H2Teesside, which is due to begin production in 2027 and is targeting 1GW of hydrogen production by 2030. It would be integrated with the already-planned Net Zero Teesside and Northern Endurance Partnership carbon capture, utilisation and storage projects in the region.

Blue hydrogen is produced by converting natural gas into hydrogen and carbon dioxide, which is then captured and permanently stored.

The announcement comes the day after it was revealed the Net Zero Teesside (NZT) and the Northern Endurance Partnership (NEP) had secured an extra £52m in private and public funding for the scheme.

Dev Sanyal, BP’s executive vice president of gas and low carbon energy, said: “Clean hydrogen is an essential complement to electrification on the path to net zero. Blue hydrogen, integrated with carbon capture and storage, can provide the scale and reliability needed by industrial processes. It can also play an essential role in decarbonising hard-to-electrify industries and driving down the cost of the energy transition.

“H2Teesside, together with NZT and NEP, has the potential to transform the area into one of the first carbon neutral clusters in the UK, supporting thousands of jobs and enabling the UK’s Ten Point Plan.”

With 1GW hydrogen production, H2Teesside would generate and send for storage up to two million tonnes of CO2 per year, equivalent to capturing the emissions from the [gas] heating of one million UK households. The captured CO2 would flow through Net Zero Teesside’s facilities and be taken for subsea storage via NEP’s offshore infrastructure.

Tees Valley Mayor Ben Houchen said: “This great news is just the icing on the cake of the past couple of weeks, when we’ve seen announcement after announcement on how Teesside, Darlington and Hartlepool is set to play its part in the clean energy revolution.

“In securing our Freeport, the news of GE Renewable Energy creating its offshore wind turbine blade facility in the area and now BP announcing its intention to strengthen ties, it won’t be long before other global businesses are attracted to invest here.”

The H2 project would be developed in stages, with an initial 500MW of blue hydrogen capacity in production by 2027 or earlier and additional capacity to be deployed by 2030 as decarbonisation of the industrial cluster gathers pace.

The feasibility study, which is expected to be completed this year, is exploring technologies that could capture 98% of carbon emissions from the hydrogen production process. A final investment decision for the project is expected to come in early 2024.