Hydrogen investment rises on promise of low-cost natural hydrogen

New reporting from Argus says hydrogen investment is accelerating as developers target natural hydrogen, which could be produced at significantly lower costs than current methods.

Speaking at the Hyvolution conference in Paris, industry panellists said established oil, gas and mining techniques could reduce technical risk and upfront spending, though the sector remains early-stage and uncertain.

At the Hyvolution conference in Paris, Raphael Schoentgen of Hydrogen Advisors said oil and gas firms are well placed to enter the sector, using existing geological data and drilling expertise. Developers such as 45-8 Energy are targeting shallow wells only a few hundred metres deep, keeping early costs relatively low.

Benoit Hauville of 45-8 Energy told Argus that historical drilling has likely overlooked natural hydrogen because most legacy wells were drilled in sedimentary basins rather than iron-rich formations that can generate hydrogen. Mining regions have begun to provide useful data, with hydrogen seepage reported at several nickel and chromium mines.

France has emerged as a key testing ground. Francaise de l’Énergie (FDE) secured a five-year exploration permit in Lorraine in January, while new survey techniques combining airborne sensing, seismology and rock sampling are being deployed.
Argus reports that global investment in natural hydrogen has reached around $1 billion, citing NaturalHy.

Nearly half has gone to US projects, including Koloma, which has raised about $400 million. In Europe, investment has been more limited, with 45-8 Energy raising around €40 million.

Helium co-production is seen as critical to project economics, as even small concentrations can significantly improve revenues.
Despite the momentum, Argus notes that the sector remains high risk. Only one site — in Mali — is currently producing natural hydrogen, and at minimal scale.

Source: Chingis Idrissov / Argus