Hazer targets 1mn t/yr pyrolysis H2 output in 10 years

Australian technology firm Hazer is scaling up its methane pyrolysis process, which converts methane into low-carbon hydrogen and solid graphite without direct CO2 emissions. The company has completed its first industrial-scale pilot plant in Perth that can make 100 t/yr of hydrogen, and has partnered with US engineering firm KBR for projects of 30,000–50,000 t/yr. Argus spoke to Hazer's chief executive and managing director, Glenn Corrie, about the firm's business model, global project pipeline and partnerships. Edited highlights follow:

How does Hazer's technology work? What key milestones have you achieved?

Hazer has spent nearly two decades developing methane pyrolysis. Our fluidised bed reactors split methane into hydrogen and graphitic carbon, with an iron ore catalyst lowering operating temperatures to 800–900°C, compared with 1,500–2,000°C for plasma or molten systems. This sharply reduces energy demand and hydrogen costs. Our single platform targets low-cost hydrogen, graphite products and industrial decarbonisation. We are on our sixth scale-up, with one scale-up every three years. Our commercial demonstration plant (CDP) in Australia is the fifth step and has operated for a full year with strong conversion, long run times and high-purity hydrogen and graphite. Its performance exceeded expectations and generated a project pipeline of over 50 potential customers at various negotiation stages.

Which sectors and regions best fit your hydrogen and graphite technology?

We are working with oil and gas, steel, power, ammonia, methanol and metallurgy customers seeking practical decarbonisation pathways. North America, Europe and Asia-Pacific were our initial focus, with the US strongest early on. Despite a more challenging US landscape, our low-cost economics and access to cheap gas keep the US attractive. Asia-Pacific stands out because of strong hydrogen demand, major industrial emitters, limited carbon storage options for steam methane reformers (SMR) and insufficient renewable energy for electrolytic green hydrogen. This drives a substantial pipeline in Japan and South Korea and rising Australian interest. The Middle East offers further opportunity due to large ammonia, methanol and refining industries and abundant low-cost gas. India is also emerging, given its major steel sector. We see Asia-Pacific as the leading region, followed by North America and the Middle East, then Europe as policy evolves. European policy is complex to navigate. The UK is an exception, with explicit support for methane pyrolysis.

What plant sizes are you targeting with KBR?

KBR has selected us as its exclusive methane pyrolysis technology partner, accelerating scale-up and global licensing. Our process design package will target 30,000–50,000 t/yr of hydrogen — the global SMR average. With 2,500–3,000 reformers of similar size worldwide, the opportunity for disruption is significant. We are initially targeting ammonia and methanol, where KBR has long-standing expertise — its technologies operate in over 250 ammonia plants globally. Producing 1mn t/yr of ammonia requires around 200,000 t/yr of hydrogen, making it both a large and emissions-intensive sector. KBR's strengths in fluidised bed reactors — central to our process — de-risk scale-up. A 30,000–50,000 t/yr design package will be completed in the next few weeks, and customer interest is already there.

How will you generate revenue?

We operate a capex-light licensing model. Revenue begins once a customer contract is signed, then increases through pre-feasibility, feasibility and front-end engineering design (FEED) to licensing and production after the final investment decision. Of our five announced projects, two already generate revenue. FortisBC is the most advanced, in its second year of revenue and progressing towards FEED. Energy Pathways in the UK is in its first revenue year at the pre-feasibility stage and will move through feasibility and FEED. These projects show clear commercial traction, especially given that the CDP was completed only a year ago and our partnership with KBR was formed shortly thereafter.

What are your target markets for graphite?

Our graphite is well suited to steelmaking, which requires carbon. There are at least seven applications for our product in the steel sector. Because our catalyst is iron ore, the graphite aligns particularly well with electric-arc furnace (EAF) recarburisers. The Whyalla concept demonstrates this synergy — hydrogen for direct reduced iron and graphite for the EAF. We are also targeting concrete and asphalt, where testing shows our graphite qualifies as a [suitable] product, as well as thermal energy storage and specialty high-grade markets including batteries and advanced technologies. We can purify graphite to battery anode-grade material through an internal process, although further work is needed. Battery-grade graphite can reach $5,000/t, compared with $500–600/t in higher-volume industrial markets, but our immediate focus is securing large mid-value applications before expanding into smaller premium segments.

Each tonne of hydrogen produces around 3.5t of graphite, so high-volume markets are critical for us to scale. Steelmaking is an 800mn t/yr carbon market, concrete and asphalt together total 200mn–400mn t/yr, and energy storage and water treatment add several million tonnes more. Global graphite demand exceeds 1bn t/yr, with China supplying over 85pc, creating strong strategic demand for domestic production across North America, Europe and Asia-Pacific.

How much does it cost to make hydrogen using your process?

Our levelised hydrogen cost depends mainly on natural gas and power prices. With US Henry Hub gas and Texas electricity, hydrogen costs just above $1/kg, or below $2/kg without graphite sales factored in. In Asia, where gas is 2-3 times more expensive at around $10/mn Btu, costs are roughly $2.30/kg. Our main advantage is low energy use — water electrolysis for green hydrogen typically requires 55 kWh/kg, while our process uses 8–10 kWh/kg. Together with KBR, we are exploring heat recovery, storage and scale efficiencies that could reduce costs further. This creates a clear pathway to sub-$2/kg hydrogen in the US and very competitive costs elsewhere, all without subsidies. We model incentives such as the US' 45V hydrogen production tax credit, but we will not depend on them. Because policy shifts create uncertainty, staying at the low end of the cost curve ensures competitiveness as hydrogen markets evolve.

What challenges have you faced?

The hydrogen market has been affected by concerns over green hydrogen costs, which has impacted us as well. But this environment also clarified the value of methane pyrolysis and helped enable our partnership with KBR. The sector is maturing, as highlighted by ExxonMobil's entry through BASF's process. Policy support is strengthening. Australia may include pyrolysis in its guarantee of origin scheme. The UK openly supports it and Asia favours low-cost, technology-agnostic hydrogen. The global hydrogen market is 100mn t/yr, producing 1bn t/yr of CO2. Our goal is to develop 10 plants in 10 years, delivering around 1mn t/yr of hydrogen capacity or 1pc of the global market. With a large project pipeline and KBR's global reach, we view this target as achievable, if not slightly conservative.