[Upcoming Hydrogen Economy] SK E&S Aiming for the Throne as 'Clean Hydrogen Maker'

30,000t Liquefied Hydrogen Production at SK Incheon Seokhwa Complex in November
Blue Hydrogen Utilizing Carbon Capture and Storage to be Mass-Produced by 2026
Joint Asia Regional Project with US Plug Power

'From a city gas company to the largest hydrogen operator in Korea'

On a site of over 50,000㎡ (about 15 million pyeong) within the SK Incheon Petrochemical Complex located in Wonchang-dong, Seo-gu, Incheon, construction is underway for facilities that refine byproduct hydrogen into high-purity hydrogen. Byproduct hydrogen, a byproduct generated from petrochemical processes that produce nylon or plastics, is fed into these facilities to produce high-purity hydrogen. This hydrogen is then cooled to an ultra-low temperature of minus 253 degrees Celsius and liquefied. This is so-called liquefied hydrogen. Its volume is only 1/800th that of gaseous hydrogen, making it advantageous for large-scale storage and transportation.

1MW-class polymer electrolyte membrane (PEM) type water electrolysis facility of the U.S. hydrogen company 'Plug Power,' which established a joint venture with SK E&S

This liquefied hydrogen is sent to refueling stations. Unlike gaseous refueling stations that use compressors, liquefied hydrogen stations utilize ultra-low temperature pumps, enabling refueling more than four times faster. SK E&S will produce 30,000 tons annually of liquefied hydrogen based on byproduct hydrogen at this site starting November this year. This amount is enough for 75,000 hydrogen passenger cars (based on Nexo) to simultaneously circle the Earth once (about 40,000 km).

Starting with liquefied hydrogen based on byproduct hydrogen, SK E&S has embarked on producing various types of clean hydrogen. Their goal is to become the 'world’s number one hydrogen operator.' To this end, SK Group plans to invest 18.5 trillion KRW by 2025. The largest investor is SK E&S itself. Founded in 1999 as a city gas operator, SK E&S is transforming into a hydrogen production company handling liquefied hydrogen as well as blue and green hydrogen.

Hydrogen is commonly classified by color. The most ideal hydrogen is green hydrogen. It is produced by generating electricity from renewable sources such as solar, wind, and hydro power, and then using that electricity to split water. Since no carbon is emitted during production, it is environmentally friendly and can be continuously reproduced without resource waste. However, the production cost is high.

Next is blue hydrogen. Blue hydrogen is produced by decomposing fossil fuel natural gas. Carbon dioxide generated during production is captured and stored separately, making it more environmentally friendly than fossil fuels but still more burdensome to the environment than green hydrogen. If natural gas is used to produce hydrogen without capturing carbon dioxide, it is called gray hydrogen.

While liquefied hydrogen production is centered in Incheon, blue hydrogen’s stage is Boryeong, Chungnam. SK E&S plans to invest 5 trillion KRW with Korea Midland Power to establish a blue hydrogen production base near the Boryeong LNG terminal by 2026, supplying 250,000 tons of hydrogen annually. Blue hydrogen reduces carbon emissions by applying carbon capture and storage (CCS) technology when extracting hydrogen from natural gas.

SK E&S plans to import natural gas from Australian gas fields to produce hydrogen and then re-inject the captured carbon into nearby gas fields. Blue hydrogen is more environmentally friendly than byproduct hydrogen-based methods and more economical than green hydrogen. Through this, SK E&S aims to secure an annual hydrogen production capacity of 280,000 tons, including 30,000 tons of liquefied hydrogen and 250,000 tons of clean hydrogen.

SK E&S has commenced the Front-End Engineering Design (FEED) work to convert the Bayu-Undan natural gas production facility located offshore East Timor into a CCS plant. The photo shows the Bayu-Undan gas field. [Image source=Yonhap News]

Preparations are also steadily progressing to produce green hydrogen made by electrolyzing water with electricity generated from renewable energy such as solar and wind. In 2021, SK E&S and SK Inc. invested 1.85 trillion KRW to become the largest shareholder (10% stake) of the U.S. hydrogen company Plug Power. Plug Power is a leading company in electrolyzer equipment that electrolyzes water and has held the number one market share in the global polymer electrolyte membrane (PEM) water electrolysis equipment market.

Last year, SK E&S and Plug Power established a joint venture, 'SK Plug Hyverse,' and signed a contract to introduce the first MW-class PEM water electrolysis equipment in Korea. They also participate in the Ministry of Trade, Industry and Energy’s national R&D project, '10MW-class renewable energy-linked large-scale green hydrogen demonstration technology development,' planning to build and operate a 5MW-class PEM water electrolysis facility, the largest single facility in Korea.

SK E&S is also promoting the establishment of a hydrogen ecosystem covering not only production but distribution and utilization. Various mobility types such as buses, forklifts, and drones are the main targets. Commercial vehicles face challenges in switching to electric vehicles due to battery weight and charging time issues, but hydrogen enables fast charging and reduces battery weight, making it advantageous for long-distance travel and heavy cargo transport. SK E&S plans to secure about 30 liquefied hydrogen refueling stations nationwide this year, with eight of them aiming for commercial operation within the year.

Additionally, SK Plug Hyverse is preparing to build a hydrogen equipment production and research base, the 'Hydrogen Technology R&D Center and Gigafactory,' in Cheongna International City, Seo-gu, Incheon, to supply hydrogen fuel cells and water electrolysis equipment products to the Asian market. Chu Hyung-wook, CEO of SK E&S, said, "We will do our best to reliably produce and supply competitive liquefied hydrogen and make this year the inaugural year for the spread of liquefied hydrogen in Korea."