ExxonMobil is demanding that green hydrogen extracted from natural gas receive tax cuts in America. This comes under the inflation reduction law, especially after the holding company concluded an agreement to sell low-carbon fuel to Jira, which is considered the largest supplier of electricity in Japan.

The "Jera" company is considering purchasing 500,000 tons annually, equivalent to half the volume of ammonia, which is produced by the low-carbon green hydrogen project that was proposed to be established in Baytown, Texas. It is expected that the green hydrogen will be converted into ammonia for the purpose of shipping and storage, and then it will be consumed to generate electricity in a way that produces… It has lower emissions.

Dan Ammann, President of Exxon Low Carbon Solutions, stated that the agreement is non-binding as it shows the great demand for low-carbon hydrogen and ammonia, in addition to the fact that operating the project requires the administration of US President Joe Biden to expand the scope of the tax cuts stipulated in the law. Reducing inflation to include hydrogen extracted from natural gas.

Hydrogen is considered a basic and necessary way to reduce emissions in the process of heavy industries, in which electricity is difficult to consume. The inflation reduction law provides fuel support, but Biden announced that green hydrogen is eligible for support and not blue hydrogen, which is extracted from natural gas, especially in cases of capturing emissions resulting from it.

Exxon has been intensifying its efforts to reduce carbon emissions since the Corona pandemic, and does not aim to establish huge projects such as the Baytown project unless the projects will achieve a financial return of no less than 10%, and tax cuts are considered a decisive factor in achieving profits.

The company did not proceed with the Baytown project without achieving reductions, and low-carbon hydrogen must receive tax collection regardless of the means of production, and the tax reduction system is expected to achieve the required results in addition to the progress that is being achieved on both the supply and demand sides.

The Baytown project is expected to be the largest facility in the world for producing low-carbon hydrogen, and to be operational in 2028. If implemented and established, the project will produce 900,000 tons of hydrogen produced from natural gas, through the use of carbon capture technologies to remove emissions and about more. Of one million tons of ammonia.