Hazer Group Ltd (ASX:HZR)

Waiting for news in the pipeline

HZR recently (28 Feb) announced the results from preliminaryprocess modelling to simulate the potential application of the group’sproprietary Hazer Process, and compared the operational costs in terms of toneof hydrogen produced (A$/t H2) versus competing processes - Steam MethaneReforming (SMR) and Electrolysis.

Some 65 million tones of hydrogen are produced globally eachyear; the gas is a critical feedstock for the production of fertilizers(ammonia), oil refining and the production of low-Sulphur transportation fuels,and chemicals. There has also been substantial progress towards the use ofhydrogen as an energy carrier via hydrogen fuel cells. The vast bulk (+95%) ofH2 production currently comes from reforming fossil fuels, particularly naturalgas. The process is mature, relatively simple (reacting steam at hightemperature with the fossil fuel), and requires relatively low capex. Theprocess however, is environmentally damaging, producing at least 10-12t of CO2for every tone of hydrogen produced. HZR’s base-case analysis indicates thatthe Hazer Process can reduce CO2 emissions by 70% relative to the SMR process,and lower net H2 production costs by 75% (with higher gas costs (due to higherrequired volumes of gas input) more than offset by graphite co-productrevenue). We believe the results of the Hazer Process vs SMR cost analysiscould be of particular interest to producers of hydrogen in the fertilizer, oilrefining, and chemical industries.