Mexico Expropriates Air Liquide's Hydrogen Plant at Tula Refinery

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Written by Amir Richani for Industrial Info Resources (Sugar Land, Texas)--Mexico's federal government recently issued a decree declaring the hydrogen plant at Air Liquide's Tula Refinery a public good, given its role in fuel production, and expropriating the asset.

Air Liquide's U-3400 hydrogen plant at the 315,000-barrel-per-day (BBL/d) Tula Refinery will become part of Pemex Industrial Transformation, the refining arm of national oil company Petroleos Mexicanos (Pemex) (Mexico City). Subscribers to Industrial Info's Global Market Intelligence (GMI) Petroleum Refining Plant Database can learn more from a detailed plant profile.

The plant, situated in the refinery's waste hydrodesulfurization complex, can produce up to 2.1 million cubic meters of hydrogen per day, at a high purity of 99.9% mol. The plant's products are instrumental in the production of gasoline and diesel with low sulfur content, a key environmental consideration.

"Hydrogen produced by the U-3400 hydrogen plant is used in gasoline, intermediate, diesel and gas-hydrodesulfurization plants, whose demand is increasing every day since, in order to care for the environment, the content of sulfur in petroleum products must be reduced," according to the decree. "The presence of sulfur in fuels generates polluting oxides, so it is necessary to reduce its (sulfur) content and increase the use of hydrogen. Hence, the need to have the direct and immediate availability of hydrogen in Pemex Tri's production process."

In 2017, Air Liquide signed a 20-year agreement with the previous government to operate the plant and supply Pemex with hydrogen. The agreement included investments of about US$53 million for the takeover and optimization of the hydrogen production unit. However, in December 2023, the government declared the plant's production a public good, allowing for Pemex's temporal occupation of the asset.

As per the expropriation decree, Pemex Industrial Transformation will be responsible for compensating Air Liquide for the plant.

The administration of Andres Manuel Lopez Obrador has consistently shown its backing for Pemex and the national electricity industry through various means, including political support and tax exemptions. The expropriation of Air Liquide's hydrogen plant is another episode of Obrador's efforts to strengthen Pemex before the end of its current mandate.

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