26/03/03
Hazer targets 1mn t/yr pyrolysis H2 output in 10 years
London, 3 March (Argus) — Australian technology firm Hazer is scaling up its
methane pyrolysis process, which converts methane into low-carbon hydrogen and
solid graphite without direct CO 2 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. Hazer's project partners Partners
Location H2 output (t/yr) Status Fortis BC British Columbia, Canada 2,500
Feasibility stage, moving to FEED Chubu Electric & Chiyoda Nagoya, Japan
2,500-10,000 Pre-feasibility done, in feasibility Posco Pohang, South Korea -
Studying integration into Posco's HyRex tech Energy Pathways Marram gas field,
UK 20,000 Concept / pre-feasibility stage Engie Montoir-de-Bretagne, France
2,500 Ongoing, also exploring projects in Europe M Resources Whyalla, Australia
- Submitted joint bid for Whyalla Steelworks Hazer Group, Argus Hazer's graphite
end-use partners Partner Application markets Mitsui Iron & steel, chemicals,
batteries, others Posco Iron & steel M Resources Iron & steel Kemira Water
treament Veolia Water treatment Chubu Electric Concrete & asphalt First Graphene
Advanced carbon materials University of Sydney Batteries, others Hazer Group,
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