French energy company TotalEnergies has chosen the US as the location for its first large-scale project to produce carbon-neutral synthetic methane from renewable hydrogen, citing the offer of attractive subsidies and well-developed infrastructure.

It has formed a joint venture with Belgium-based Tree Energy Solutions (TES) to study and develop the project with a potential output of 100,000–200,000t/yr of synthetic methane, or e-NG, produced by combining green hydrogen and biogenic CO₂.

The project, owned equally by the partners and operated by TotalEnergies, will generate hydrogen with a 1GW electrolyser powered by c.2GW of wind and solar power supplied by TotalEnergies under long-term power-purchase agreements.

“The US has many advantages for the development of our first e-NG project, including well-developed gas infrastructure, growing renewable power generation capacity and significant public subsidies” Michel, TotalEnergies

TotalEnergies and TES will carry out the preliminary studies and aim to reach FID in 2024. The project is expected to benefit from tax credits under the 2022 Inflation Reduction Act (IRA).

“The US has many advantages for the development of our first e-NG project, including well-developed gas infrastructure, growing renewable power generation capacity and significant public subsidies,” says Stephane Michel, president gas, renewables and power at TotalEnergies.

“This groundbreaking project testifies to the effectiveness of the IRA in the US,” adds TES’ CEO, Marco Alvera.

The French major’s decision to pursue its project in the US comes as the EU tries to counter the IRA by enhancing subsidies for green hydrogen.

Synthetic methane can be transported—as a liquid or by pipeline—and used as a direct replacement for natural gas without the need to modify infrastructure or end users’ facilities. Because it contains biogenic CO₂ from natural sources, rather than from the burning of fossil fuels, it is considered carbon neutral.

“This synthetic fuel will contribute to the energy transition by helping our customers to decarbonise their activities, notably the ones that are difficult to electrify,” says Michel.

Under the joint venture, TotalEnergies will draw on TES’ knowhow in synthetic methane production. The Belgium-based developer, led by former CEO of Italian energy firm Snam Alvera, is already developing a “closed loop” production process to supply green hydrogen to northwest Europe by shipping in synthetic gas from renewable-rich regions and converting it back to hydrogen, with the CO₂ captured and recycled back into the production process.

TotalEnergies brings to the project its expertise in renewable power, large-scale project management and natural gas liquefaction.

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Author: Stuart Penson