SSE Thermal has entered into a joint venture with Kellas Midstream to acquire a 50% stake in the H2NorthEast hydrogen project located in Teesside.
The collaboration aims to develop a hydrogen production facility with carbon capture and storage capabilities, potentially delivering more than 1GW of hydrogen production capacity by 2035.
The initial consideration for the agreement is under £10 million, with additional contingent consideration if the project advances to a financial investment decision.
H2NorthEast, supported by the UK Government’s Net Zero Hydrogen Fund, could contribute to the UK’s ambition of achieving 10GW of low carbon hydrogen production by 2030, with up to 5GW from blue hydrogen.
The project aligns with decarbonisation efforts in Teesside, and as part of the East Coast Cluster, it could connect to shared CO2 pipelines.
Catherine Raw, Managing Director of SSE Thermal and Group Executive Committee lead for hydrogen, said: “Blue hydrogen has a strategic role to play alongside green hydrogen and the hydrogen produced by H2NorthEast will not only support the decarbonisation of industry, it can be a vital piece in the net zero jigsaw for the power sector.”
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