POSCO Wins Operating Rights for 1.3 Billion Barrels of Oil, Gas...

POSCO Wins Operating Rights for 1.3 Billion Barrels of Oil, Gas in Indonesia - Businesskorea



Why is POSCO interested in securing 1.3 billion barrels of natural gas for the next 30 years? It doesnt make sense when they have publicly announced that they want to be carbon neutral by 2050. So why then, are they buying an oil/gas field? Here are some of my thoughts...

1) Gradual shift to Hydrogen for Green Steel production
So from Coal BF > Natural Gas DRI > Natural Gas/Hydrogen DRI> Hydrogren DRI

For many of the newly built DRI plants, the initial intention was to use natural gas (NG) as the feedstock or reducing agent to process ore into pig iron in an electric arc furnace (EAF) or submerged arc furnace while we wait for the price of hydrogen to stablize within the $1 dollar range. This makes sense as most of the DRI tech (Midrex equipment) supports Natural gas/H2 to fully H2.

2) Potential of White Hydrogen
Limitless ‘white’ hydrogen may soon shatter all energy assumptions – Telegraph
Maybe they are not looking for natural gas but for natural hydrogen? Natural hydrogen has been identified in many source rocks in areas beyond the sedimentary basins where oil companies typically operate. If they find a hydrogen source directly from the ground its game over as it will be super competitive.This would be the best case scenario for POSCO.

3) Producing Grey Hydrogen
Can Green Hydrogen Help Indonesia Meet Its Net-Zero Goals? | SEADS (adb.org)
Although unlikely, the other alternative is to use that 1.3b barrels of natural gas to create Grey hydrogen which costs less than $4/kg. Or easier, ship to countries who want to create grey hydrogen for those who cant afford green hydrogen for their operations. Grey hydrogen is produced through processes like steam methane reforming or autothermal reforming of natural gas with any CO2 emissions allowed to escape into the atmosphere;

What are these guys doing I wonder... Hmm.