Chemtrade Logistics Income Fund, Toronto, has agreed to a long-term partnership to supply green hydrogen to Hydra Energy Partners, Delta, B.C. Hydra will capture, clean, and compress hydrogen, focusing on Chemtrade plants in British Columbia, with the potential to expand across the country.
The flagship commercial project at Chemtrade’s Prince George facility will break ground this year, with gas expected to be flowing in 2022. Hydrogen is currently a byproduct and is not being fully monetized.
Chemtrade told analysts in its recent earnings call that the hydrogen is green, as the plant sources its electrical power from hydro-electricity. The company said it generates approximately 55kg of hydrogen for each ton of sodium chlorate produced, with expectations that Prince George will produce about 5,000 mt/y of hydrogen.
For the next five years, Hydra Energy will put capital into the project to capture the hydrogen; Chemtrade will not. Chemtrade only expects a minor positive impact until Hydra retrieves its investment; however, starting in 2027, it expects the proceeds to be more impactful.
Hydra said commercial truck fleet operators with Hydra-converted semi-trucks can access green hydrogen at a fixed price, 5 percent below the price they typically pay for diesel. Hydra installs hydrogen-diesel co-combustion conversion kits into existing semi-trucks and provides the fueling infrastructure for the green hydrogen.