bp’s 2GW hydrogen production project, which will be based at the Castellon refinery, has revealed that it has now reached a final investment decision (FID).

This decision occurred last week and it was finalised between bp and Aberdeen City Council. The decision process centered around a 300-tonne green hydrogen hub, which is expected to start production in 2026. At this point, the joint venture is currently beginning construction work and this will have officially taken off by the end of 2024.

The joint venture has been named HyVal and it has been agreed that Iberdrola will also be involved in the project. The plan for the project is for it to produce industrial-scale green hydrogen in phased development. By 2030, these phases will go up to 2GW in electrolysis capacity, within the Valencia, Spain, region. On top of this, bp will be the company to lead the public-private collaborative initiative and it has been stated that this is due to become operational during 2027. This part of the project will start with the first phase of developments and these will see a minimum of 200MW of electrolysis capacity installed at the refinery, which will lead to the production of a maximum of 31,200 tonnes of green hydrogen per year.

Before this project reached this point, bp stated that the company would hold investments in its Spanish green hydrogen projects, up until the government delivered the promised grants.

Furthermore, it was in early July when Spanish Prime Minister, Pedro Sanchez, made an announcement talking about, ‘plans for a €2.3bn ($2.5bn) package to support the country’s energy transition, with green hydrogen and renewable energy subsidies.’

On the other hand, another of bp’s projects, the Lingen, Germany project, has also received recognition as an Important Project of Common European Interest (IPCEI) and after being identified as that, it then received funding. This funding has made progression of the 100MW project possible and now FID is expected to occur by the end of 2024.

bp said that, ‘the two projects could create sustainable aviation fuel and green hydrogen for customers’ and the other benefit of the projects, is that they will support the company’s decarbonisation activities.

CEO at bp, Murray Auchincloss, commented, “Our businesses continue to operate safely and efficiently. We are driving focus across the business and reducing costs, all while building momentum in our drive to 2025.”