Hydrogen: a bright future, but a cloudy present
Identified as a cornerstone of the energy transition, hydrogen has been a source of great hope for years, especially “green” hydrogen, which is produced using renewable electricity making it CO2-free. A total of 89 countries worldwide have adopted national hydrogen strategies, with tens of billions of dollars invested in the sector. Yet, the hydrogen revolution is slow to materialize.
Why? Simply because green hydrogen is not competitive. It is a manufactured product, created using electricity through an industrial process called ‘water electrolysis’, which is highly expensive. While green hydrogen is much cleaner than grey or blue hydrogen (derived from natural gas), it is also significantly more expensive to produce. The cost of 1kg of green hydrogen is around US$6, which is four to five times more expensive than the fossil fuels it is intended to replace in the energy transition.
This harsh reality is underscored by a single statistic: less than 10% of large-scale green hydrogen projects worldwide have reached the Final Investment Decision stage. In other words, over 90% of these projects may never come to fruition.
Natural hydrogen: the game changer
In this context, a new type of hydrogen is gaining attention: white hydrogen, also known as natural or geological hydrogen. Unlike grey, blue, or green hydrogen, this energy source is not manufactured from other inputs (natural gas or electricity) but is a naturally occurring in the subsurface, just beneath our feet.
The earth has been naturally producing hydrogen for millennia under specific geological conditions — at certain depths, temperatures, and in the presence of iron-rich rocks. In this process, water molecules (H2O) split into oxygen (O) and hydrogen (H2) in a mechanism resembling water redox reactions, called serpentinization.
This means that not only does the earth naturally produce what industries attempt to replicate in facilities above ground (water electrolysis), but it does so much more economically. The estimated cost of 1kg of natural hydrogen is US$1, six times cheaper than green hydrogen.
At this price, natural hydrogen is competitive with fossil fuels, capable of replacing them in certain applications, and can serve as a key pillar of the energy transition. It’s a true game changer.
The white gold rush has started
The excitement surrounding natural hydrogen has emerged over the past three years, accelerating significantly in the past 18 months as enthusiasm for green hydrogen wanes.
Pioneering companies have launched exploration projects worldwide, with about 50 currently underway, particularly in North America, Australia, and Europe. Several countries have updated their mining codes to include this new resource, enabling its exploitation. The United States, France, and South Australia are examples.
These pioneering explorers aim to demonstrate that natural hydrogen is abundant, commercially viable, and capable of playing a central role in the energy transition. This marks the beginning of a true energy revolution.
Major investors are already on board, including mining sector players
Companies leading the exploration and production of natural hydrogen have secured backing from visionary investors. For example, Bill Gates (via his Breakthrough Energy fund) and Jeff Bezos (via his Amazon Climate Pledge fund) have invested in Koloma, a US-based company that has already raised over US$400M.
Natural hydrogen is also attracting industrial investors. Japan’s Mitsubishi recently participated in Koloma’s latest fundraising round.
The mining sector has not been left out, with Australian giant Fortescue acquiring a 40% stake in HyTerra, a natural hydrogen exploration and production company active in the United States.
Synergies and similarities with the mining sector
Fortescue’s entry into this nascent industry is unsurprising given the similarities between the mining and natural hydrogen sectors. While the resources differ, the exploration processes are very similar. Natural hydrogen sits between the mining and oil and gas industries.
The synergies between these two industries are apparent. Increasingly, mining companies are taking an interest in this new resource, as are traditional mining investors, who see it as a logical way to diversify and decarbonize their portfolios.
Natural hydrogen found in mines?
The synergies between natural hydrogen and mining may extend far beyond financial considerations. Geologists have noted that the geological conditions favourable for hydrogen generation often overlap with those that host mineral resources. Cratons, which contain iron-rich rocks essential for hydrogen generation, are also targets for mining operators seeking gold, silver, and other resources.
A striking example of this hydrogen-mining relationship occurred in March 2024, when significant natural hydrogen emissions were detected in a chrome mine in Albania, suggesting the presence of a substantial deposit of hydrogen.
Local, clean, and cost-effective electricity for mining operators?
The presence of natural hydrogen in mines could enable on-site electricity production. Hydrogen, like natural gas, can be used to generate electricity.
This would address two significant challenges for mining companies: providing abundant and inexpensive energy for their operations and decarbonizing their sites.
