'We won't sign clean hydrogen offtake deals until we get the right price — despite investor pressure': Air Products CEO

Seifi Ghasemi hints on an analyst call that the company will phase out grey hydrogen in 15 years, shoots down notion of an H2 spin-off in short-term   

 

Air Products’ CEO Seifi Ghasemi has pushed back on analyst concerns that there will not be sufficient demand for blue and green hydrogen by 2030 to justify the industrial gases firm’s early investments into major projects. “The part that I can confidently tell the investors, believe me, there is demand,” he said during the company’s second quarter earning call. “Do not buy into this business that there is no demand. There is demand.”

Air Products has agreed to offtake all the green ammonia being produced at the 2.2GW Neom complex currently under construction in Saudi Arabia for a 30-year period. The firm is also a shareholder on the project, which reached a $8.4bn financial close last year.

However, the offtake deal is a huge bet that whatever price the industrial gases firm has agreed to buy at, there will be third-party buyers willing to pay more, once the project comes on line at the end of 2026 or beginning of 2027.

Similarly, the company is developing a $4.5bn blue hydrogen and ammonia project in Louisiana, set to be fully commissioned in 2028, which would produce more than 1,770 tonnes of H2 per day.

 

However, Air Products has not signed third-party offtake agreements for either megaproject, with the lack of guaranteed returns prompting anxiety that the industrial gases firm would be unable to recoup its costs, let alone make a profit off these investments.  

'We won't sign clean hydrogen offtake deals until we get the right price — despite investor pressure': Air Products CEO | Recharge (hydrogeninsight.com)

'We won't sign clean hydrogen offtake deals until we get the right price — despite investor pressure': Air Products CEO | Rech