Lotte Chemical Co., a South Korean petrochemical major, said it will invest 4.4 trillion won ($3.8 billion) in the hydrogen business by 2030 to cut its carbon emissions and foster the new growth driver.
Under its hydrogen growth roadmap, Green Promise 2030, Lotte Chemical said through the investment it aims to generate annual sales of 3 trillion won ($2.6 billion) with an operating profit margin of over 10% in its hydrogen-related business alone by the 2030 pledge date.
Lotte Chemical is the latest company to pinpoint hydrogen as a future growth engine. In terms of hydrogen production, companies in these fields have an advantage because hydrogen is a natural byproduct in their factories.
The company said it will establish blue hydrogen facilities with an annual production capacity of 160,000 tons by 2025. It also plans to generate green hydrogen at overseas facilities and bring it to Korea for industrial use, with a target of 440,000 tons a year of green hydrogen by 2030.
Overall, Lotte aims to launch facilities with an annual hydrogen production capacity of 600,000 tons by 2030.
Grey hydrogen is produced when the element is stripped from fossil fuels, while blue hydrogen is produced from natural gas and produces less carbon dioxide (CO2). Green hydrogen is the cleanest variety as it uses renewable energy to produce hydrogen from water.
In terms of R&D investment, the company plans to develop technology to mass produce hydrogen storage tanks. The goal is to have 500,000 hydrogen tanks by 2030 that could be used to supply hydrogen to vehicles.
The company also plans to invest in carbon capture, utilization and storage (CCUS) technology, which can trap carbon dioxide naturally produced in its petrochemical factories.