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Air Liquide to invest $850 million into Exxon’s Baytown hydrogen project

June 25, 2024

France-based Air Liquide Group is investing $850 million into Exxon Mobil Corp.'s (NYSE: XOM) massive clean hydrogen and ammonia plant in Baytown.

The international industrial gasses company, which has its U.S. headquarters in Houston, plans to build, own and operate four large, modular air-separation units and other infrastructure for Exxon’s low-carbon hydrogen project. This marks Air Liquide’s largest industrial investment in its history.

Air Liquide’s infrastructure will produce oxygen and nitrogen for Exxon’s project, along with argon and other gasses for the company’s other customers. Exxon will also be able to use Air Liquide’s existing pipeline network to transport its hydrogen produced from the project.

"Momentum continues to build for the world’s largest low-carbon hydrogen project and the emerging hydrogen market,” Dan Ammann, president of ExxonMobil Low Carbon Solutions, said in a press release. “This partnership with Air Liquide further strengthens our Baytown project by enabling hydrogen distribution through existing networks and securing key feedstocks.”

Exxon's project has yet to reach a final investment decision.

Exxon expects its planned hydrogen production facility to produce 1 billion cubic feet of low-carbon hydrogen daily and more than 1 million tons of ammonia a year. The project is also expected to capture and store 7 million tons of carbon dioxide per year using technology developed by North Carolina-based Honeywell (Nasdaq: HON).

Air Liquide touts its large, modular air-separation units as a key technology in the energy transition, as they use less electricity than other units to produce each tonne of oxygen and primarily run on renewable and low-carbon energy, the company said.

"Our Baytown Low Carbon platform project demonstrates our capacity to innovate and leverage on our footprint in the U.S. to actively contribute to the decarbonization of the industry,” Air Liquide CEO François Jackow said in the release. "Through this new agreement with ExxonMobil, Air Liquide is proud to support the development of what is poised to be the world’s largest low-carbon platform while reinforcing its gas offering in this key industrial basin."

Air Liquide, which has more than 20,000 employees in the United States, is one of the members of the proposed HyVelocity Hub. The consortium also includes Exxon, AES Corp. (NYSE: AES), Chevron Corp. (NYSE: CVX), Mitsubishi Power Americas, Orsted and Sempra Infrastructure. It was chosen by the U.S. Department of Energy to receive up to $1.2 billion in funding in order to build out a hydrogen network along the Gulf Coast.

By Naomi Klinge, Houston Business Journal