Engie Teams Up With Rocket Maker on Hydrogen Shipping Fuel

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French energy giant Engie SA teamed up with rocket maker ArianeGroup to develop hydrogen production equipment and promote the gas as a clean fuel for the shipping industry.

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The partnership comes as France and other European nations step up subsidies for research into cleaner and cheaper hydrogen development. While the gas could help replace dirtier fuels in transport and industry, producing it from water using clean power is more expensive than extracting it from fossil fuels.

Engie and ArianeGroup — a joint venture between Airbus SE and jet-engine maker Safran SA — will pool their expertise in liquefied natural gas and liquid hydrogen systems to cut the cost of liquefaction and refueling equipment such as pumps and valves, they said in a statement Thursday.

The partners, as well as French shipping company CMA CGM, are seeking subsidies to improve liquefaction technologies and start a pilot project to refuel tow-boats with liquid hydrogen as soon as 2025, said Frederic Legrand, a manager at Engie’s Crigen liquefaction laboratory.

“If we develop a viable solution from an economic point of view, the market is huge,” Legrand said at a press conference in Paris. “We can imagine one liquefactor per harbor, one per airport.”

What’s the Green Fuel of the Future for Shipping?: QuickTake

Liquefying hydrogen — which requires the gas to be cooled to -253 degrees Celsius — is key to reducing its volume, allowing enough of the fuel to be stored for long-haul shipping, and ultimately aviation. Both industries are under pressure to curb carbon emissions as customers and investors demand greater efforts to tackle climate change.

The Engie-ArianeGroup venture is seeking to halve the cost of liquefaction to 1 euro ($1.18) per kilogram, Engie interim Chief Executive Officer Claire Waysand said Thursday.

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