Tallgrass Moves to Blackstone in Global Hydrogen Market Shakeup

Researched by Industrial Info Resources (Sugar Land, Texas)--U.S. pipeline developer Tallgrass Energy Partners (Leawood, Kansas) is getting a new boss--this one closer to home. Blackstone Incorporated (NYSE:BX) (New York, New York) agreed to buy a 30% stake in Tallgrass from gas utility Enagas S.A. (Madrid, Spain) for $1.1 billion. Tallgrass is among the companies venturing into the growing market for hydrogen. Industrial Info is tracking more than $2.8 billion worth of active and planned projects from Tallgrass, more than $900 million of which is attributed to grassroot efforts.

Enagas says proceeds from its sale of Tallgrass will finance its plans to develop renewable hydrogen infrastructure in its home country. The European utility wants to transition from its long-standing role as a natural gas grid operator to the manager of a hydrogen network, supported in part by Spain's ambitions to become a leading developer of green hydrogen. Spain itself has a 5% stake in Enagas.

The transaction is expected to close at the end of July. "With the rotation of the stake in Tallgrass Energy, Enagas strengthens its balance sheet to undertake, with guarantees, the execution of the investment plan in renewable hydrogen infrastructure, included in the European Union's list of Projects of Common Interest and complying with the mandate of the [Spanish] Royal Decree that designates Enagas as provisional manager of the Hydrogen Backbone Network," Enagas said in a statement.

Industrial Info is tracking more than US$4.2 billion worth of active and planned projects from Enagas, more than 95% of which is attributed to hydrogen projects. Subscribers to Industrial Info's Global Market Intelligence (GMI) Oil & Gas Pipeline Project Database can click here for a list of detailed project reports.

But Tallgrass itself is proposing more than $1 billion worth of hydrogen pipeline projects across the U.S., although most remain in their early design phases and are unlikely to begin construction within the next 12 months. The biggest of these is Greenview Hydrogen Pipeline, which is designed to carry up to 150 barrels per day (BBL/d) of hydrogen from Shiprock, New Mexico, to Flagstaff, Arizona.

Greenview's 110-mile New Mexico portion would originate at a pump station in Shiprock, from which it would run to the state border near Gallup and connect with the 125-mile Arizona portion, which would terminate at a pump station in Flagstaff. Subscribers can learn more about the proposed development in detailed reports on the New Mexico and Arizona lines, and the New Mexico and Arizona pump stations.

Altogether, Tallgrass' efforts account for more than 40% of the active and proposed investment in the U.S. hydrogen pipeline market. Other companies pursuing domestic hydrogen-transport projects include Mitsubishi Power Americas Incorporated (Lake Mary, Florida) and Texas Brine Company LLC (Houston, Texas), which are partnering on a trio of lines originating in Beulah, North Dakota. All three are in their early equipment-study stages; if built, the lines would terminate in Tioga, North Dakota; Delta, Utah; and Saltville, Virginia. Subscribers can read detailed reports on the projects terminating in Tioga, Delta and Saltville.

Three years ago, Tallgrass acquired a 75% membership interest in Escalante H2 Power, which is proposing a blue hydrogen project at the Escalante Generating Station near Prewitt, New Mexico. The coal-fired Escalante plant was retired in 2020, but Escalante H2 Power wants to convert the facility to produce hydrogen using Newpoint Gas LLC's (Columbus, Texas) Carbon Blue technology, which captures and sequesters (or repurposes) carbon emissions from the production process. The project remains in its early site-study stage. Subscribers can learn more from a detailed project report.

Subscribers to Industrial Info's GMI Project and Plant databases can click here for a full list of detailed reports for projects mentioned in this article, and click here for a full list of related plant profiles.

Subscribers can click here for a full list of reports for active and planned projects in the U.S. from Tallgrass.

Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) platform helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking more than 200,000 current and future projects worth $17.8 trillion (USD).