In Baytown, Texas, ExxonMobil is constructing what could become one of the world’s largest low-carbon hydrogen and ammonia facilities — a flagship project that marks a defining moment in the evolution of U.S. energy infrastructure.
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A New Chapter in Baytown’s Legacy
For more than a century, ExxonMobil’s Baytown complex has been a cornerstone of America’s refining and petrochemical landscape. Now, the site is poised to lead the next era of industrial decarbonization through the development of a world-scale “blue hydrogen” project — where hydrogen is produced from natural gas, and nearly all resulting CO₂ is captured and stored.
At full scale, the Baytown project will produce around 1 billion cubic feet of hydrogen per day and capture up to 7 million metric tons of CO₂ annually. That CO₂ will be permanently stored in nearby geological formations as part of ExxonMobil’s broader Houston Carbon Capture and Storage (CCS) network — a regional decarbonization hub that could eventually support multiple Gulf Coast emitters.
Hydrogen Meets Heavy Industry
Hydrogen is often viewed as a clean fuel for transportation, but its most immediate and impactful role may come from decarbonizing industrial heat and feedstocks. At Baytown, ExxonMobil plans to use this low-carbon hydrogen to power its own olefins and chemical units, cutting emissions at the complex by up to 30%.
To make this possible, Exxon engineers developed and tested hydrogen-capable burners capable of running on up to 100% hydrogen without sacrificing efficiency or yield — a crucial breakthrough for converting existing steam crackers and heaters.
Partnerships Driving Scale
ExxonMobil isn’t going it alone. The project is supported by a network of global partners:
- Air Liquide will build and operate large air separation units, while leveraging its Gulf Coast hydrogen pipeline network to move product across the region.
- Mitsubishi Corporation has signed a framework agreement to offtake low-carbon ammonia, potentially exporting it to Japan to support that nation’s clean energy goals.
- Marubeni Corporation recently signed a deal to purchase 250,000 metric tons of ammonia per year, marking the project’s first major offtake agreement.
- ADNOC (Abu Dhabi National Oil Company) acquired a 35% equity stake, signaling global investor confidence in the Gulf Coast’s blue hydrogen economics.
Engineering work is being led by Worley, which was awarded a major EPC contract covering early site preparation and integration with Baytown’s existing infrastructure.
Policy, Risk, and the Economics of “Blue”
While ExxonMobil has positioned Baytown as a market-ready, large-scale decarbonization project, its success is tied closely to federal incentives — particularly the U.S. Inflation Reduction Act’s 45V hydrogen production tax credits and 45Q carbon capture credits.
Recent uncertainty over the continuation of federal clean-energy funding under the new U.S. administration could impact timelines or final investment decisions. ExxonMobil has indicated that the final investment decision (FID) is expected in 2025, with startup anticipated by 2028 or 2029.
The stakes are high. If completed as envisioned, Baytown could anchor a regional hydrogen economy that links Gulf Coast industrial clusters, CCS storage hubs, and global ammonia export markets. If policy support weakens, projects of this scale could face headwinds against lower-cost “gray hydrogen” or competing “green hydrogen” facilities.
Why It Matters
Baytown represents a critical test for the commercial viability of blue hydrogen at scale. The project integrates three major components — natural gas reforming, carbon capture, and industrial integration — in a single operating ecosystem. Its success could demonstrate that heavy industry and net-zero goals can coexist without economic sacrifice.
More broadly, Baytown could become the template for low-carbon industrial hubs worldwide — demonstrating how existing hydrocarbon infrastructure can be transformed, not abandoned, in the path toward decarbonization.
Key Takeaways
- 1 Bcf/day of hydrogen and 7 Mt CO₂ captured annually make Baytown one of the world’s largest blue hydrogen projects.
- The project could cut Baytown’s emissions by 30% while supplying clean fuel to regional industries.
- Global partnerships (Air Liquide, Mitsubishi, ADNOC, Marubeni) highlight strong cross-border collaboration.
- FID expected in 2025, with first production targeted by 2028-2029.
- The project’s success could anchor the U.S. Gulf Coast as a global hub for hydrogen and CCS development.
Closing Thought
As the world races to decarbonize heavy industry, ExxonMobil’s Baytown project sits at the intersection of innovation, policy, and pragmatic energy transition. Whether it becomes the model for blue hydrogen or a cautionary tale will depend on execution, economics, and global demand for cleaner fuels — but its ambition alone signals that the next energy revolution may begin in Texas.
