Q: Why hydrogen?

A: In a world that increasingly accepts we need to reduce greenhouse gas emissions such as carbon dioxide (CO2), tackling emissions from large, single-point sources such as power generation needs to be a priority.

Using hydrogen generated from fossil fuels to fuel power stations, with the CO2 that would otherwise have been emitted captured and stored in deep geological formations such as partially depleted oil and gas fields, can be a major contributor to reducing CO2 emissions. It also creates the option of using the hydrogen in other applications such as transport.

Q: How can you make it as cost-effective as gas-fired generation?

A: The hydrogen power project is an environmentally friendly plant as it will produce low carbon power through the capture of CO2. The low carbon power will warrant a premium to conventional power generation due to the additional operational and investment expenses required to capture the carbon.

Abu Dhabi National Oil Company (Adnoc) will offtake the CO2 for enhanced oil recovery and gas replacement presently used in the oil reservoirs. The overall project economics depend on both income streams.

Abu Dhabi is particularly well positioned competitively to make this happen. The overall project economics benefit from the fact that in this region, the CO2 has a value as it can be used to increase the proportion of oil that can be recovered from oil fields.

In addition, Abu Dhabi is currently using natural gas to maintain pressure in oil fields. The CO2 can be used to do this so that the natural gas will be able to be produced and sold in the future. Furthermore, society is increasingly attaching a value to the removal, or avoidance, of greenhouse gas emissions so that low-carbon power generation will be competitively advantaged versus more carbon-intensive power generation.

Q: Can other feedstock rather than gas be used - for example, coal or coke?

A: Yes, other countries are progressing plans for hydrogen-fired power stations with carbon capture and storage (CCS) that are based on solid fossil fuels such as coal or petroleum coke, a by-product of the refining process.

Indeed, Abu Dhabi Future Energy Company’s (Masdar) partner in the Abu Dhabi plant, Hydrogen Energy - a joint venture of the UK’s BP Alternative Energy and Australia’s Rio Tinto - is working on plans for a plant in California that would do exactly this. Using coal in this way, with CCS, is important because coal is a more carbon-intensive fuel than natural gas and rapidly growing economies such as India and China are, and will continue to be, heavily reliant on domestic sources of coal for power generation.

The Masdar plant will use natural gas, which requires different technology - reformation of the gas - to create the streams of hydrogen and CO2, whereas solid fuels have to be gasified to create these gases.

Q: What are the main challenges to hydrogen energy?

A: There are no real challenges to hydrogen-based fuel as the production of hydrogen is a proven process, applied for a long time in fertiliser production plants etc, and the petroleum refining industry is used to handling large volumes of hydrogen.

The burning of syngas in modified gas turbine engines is a proven process - the necessary metallurgy is proven and the hydrogen is mixed with nitrogen to keep the temperature at which the gas combusts from being too high.

Q: What is the status of Masdar’s hydrogen energy project?

A: As we announced in January, we are undertaking the front-end engineering and design for the project. The project is still on schedule, with active interaction with the key stakeholders like Adnoc and Adwec for the commercial arrangements for the sale of the CO2 and power.

We anticipate completing the engineering and design work at the end of the year so that an investment decision can be made in early 2009 and the plant can be completed by the first quarter of 2013.