Yashee Mathur

Techno-economic analysis of natural and stimulated geologic hydrogenThe objective of this study is to explore the techno-economic cost drivers for both naturally occurring and stimulated geologic hydrogen production, aiming to understand the factors influencing the production cost of hydrogen to truly unlock the low-carbon geologic hydrogen economy. We conducted a comprehensive analysis of the capital expenditure (CAPEX) and operating expenditure (OPEX) costs associated with producing geologic hydrogen through both natural occurrence and stimulation methods. This analysis encompassed the costs of both the upstream and midstream operations such as exploration and appraisal, drilling, extraction, processing, compression, liquefaction, and transportation. We go into the details of what each of these costs entails and what influences the said cost. Stimulated hydrogen includes additional OPEX on permeability enhancement and the injection and circulation of fluids through the reservoir.  We outline possible revenue streams for geologic hydrogen such as selling the hydrogen directly to midstream players or end users and government incentives based on lower carbon intensity of geologic hydrogen. We also perform sensitivity analysis to understand how key changes in assumptions such as hydrogen purity, drilling costs, and carbon intensity change the final economic outcome. It also becomes important to outline the potential risks for geologic hydrogen to thrive such as technical, economic, regulatory, and market, and what could be the possible mitigation strategies. We briefly touch upon the market demand trying to understand the landscape for low-carbon hydrogen and if there is a clear and sustained demand for it by benchmarking geologic hydrogen with other low-carbon hydrogen production technologies. Moreover, we touch upon the environmental and social impacts of geologic hydrogen in terms of emissions, land use, water use, and potential ecological impacts. Our findings reveal that the final production cost of stimulated geologic hydrogen is slightly higher than the cost for naturally occurring hydrogen, primarily due to increased operational expenses owing to stimulation. Key cost drivers identified in production include the quantity and rate of hydrogen production from a given deposit or source rock, as well as the longevity and reliability of production wells. Moreover, it is important also to address the significant cost implications associated with hydrogen transportation and delivery. The final hydrogen delivery cost to the customer varies significantly depending on the compression and liquefaction requirements, and mode of transport, such as gas-phase liquid trucking or pipelines. Given these cost drivers, it becomes evident that developing hydrogen deposits near demand centers presents a strategic advantage, as transportation and liquefaction emerge as the primary cost components rather than hydrogen extraction itself. This study for the first time provides valuable insights into the key cost dynamics of geologic hydrogen production both through naturally occurring reservoirs as well as via stimulation. It highlights the importance of strategically locating hydrogen deposits near demand centers to minimize transportation costs. By identifying key cost drivers and conducting sensitivity analysis, our research contributes to the development of strategies for the exploration and production of geologic hydrogen to accelerate energy transition and unlock the hydrogen economy.​Co-authors: Henry Moise, Yalcin Aydin, Tapan Mukerji​