EnergyPathways PLC (AIM:EPP) CEO Ben Clube talked with Proactive about the company’s progress on its MESH hydrogen and graphite project, including engineering work now underway with partners KBR and Hazer. EnergyPathways PLC is advancing a methane-pyrolysis-based hydrogen production plant that also yields graphite as a valuable by-product. Clube said the technology offers a “low-cost form of producing hydrogen,” which the company believes can be delivered at a fraction of the cost of green hydrogen via electrolysis.
The discussion covered how KBR and Hazer will now undertake engineering design work for the hydrogen and graphite facilities. According to Clube, the hydrogen produced could serve two key markets: low-carbon ammonia production — a capability the UK currently lacks following the closure of its last ammonia facility — and hydrogen-to-power applications within the broader MESH project. He noted that the UK presents an opportunity to establish domestic industrial capacity for both hydrogen and low-carbon ammonia.
Clube also highlighted the scale and strategic importance of the graphite by-product. EnergyPathways PLC is targeting output of 60,000 tonnes per year. With the UK producing none of its own graphite and classifying it as a critical mineral, Clube emphasised that the company can offer a domestic supply solution. He added that while the company’s base case uses a conservative price of USD 500 per tonne, high-grade battery graphite currently trades near USD 10,000 per tonne, representing significant potential upside.
EnergyPathways PLC expects concept design studies to conclude early next year, with the MESH components targeted for operation in 2030 in line with UK clean-power ambitions.
Proactive: Ben, very good to speak with you this morning. You've teamed up with KBR and Hazar for the MESH engineering studies. Can you walk us through why these partners are key for scaling hydrogen and graphite production in the UK?
Ben Clube: Yeah, sure. Look, we're very excited about this development on our project. What KBR and Hazer bring is that they're going to be involved in the engineering design work for our hydrogen production project, which also will be producing graphite. It's using the KBR and Hazer technology for producing hydrogen, which is a form of methane pyrolysis.
What's exciting about it is it’s a low-cost form of producing hydrogen. We think a fraction of the cost in comparison to green hydrogen electrolysis-type technologies. We think it’s a big step forward and we'll be able to produce hydrogen into the UK market.
The markets that we're looking at for our hydrogen really come with the KBR relationship. One of those markets is utilising it for the production of low carbon ammonia. The UK doesn't produce ammonia. It closed its last production facility just over a year ago.
So we see an opportunity here to provide an industrial production capability within the UK for low-carbon ammonia. Also, the hydrogen we produce can be utilised in our MESH project for the production of hydrogen-to-power capability, which we're developing as well.
Furthermore, the graphite is really the key component here. If you compare hydrogen production with other technologies, they don't produce solid carbon or graphite. For example, blue hydrogen produces CO₂, which essentially brings an added cost of waste disposal. In our case, we're producing graphite which has value. We're targeting 60,000 tonnes per annum, and there's a strong market for graphite. It's considered a critical mineral for the UK's energy transition, and the government is seeking to secure domestic supply. We're offering up a domestic graphite production capability with this technology as well.
Proactive: Ben, how important is the graphite by-product to your strategy? And could you get support from the government for it?
Ben Clube: It’s a huge upside, we think. The UK doesn't produce any of its own graphite and relies on imports. It has a critical role in the UK's energy transition and industrial future. We’ve priced the value of the graphite into conservative economics at USD 500 a tonne. But the current price for high-grade battery graphite is around USD 10,000 a tonne. So producing 60,000 tonnes per annum with that upside could be a significant revenue stream for EnergyPathways.
Proactive: Ben, what are the next steps? MESH is targeted for operation by 2030, but what are the next key milestones investors should be looking out for?
Ben Clube: We've commenced the studies for the hydrogen production plant with KBR and Hazer. We're looking to complete those concept design studies early next year, so we'll be having an update then. And as you've already described, our ambition is to bring the components of MESH into operation in 2030 to align with the UK government's clean-power 2030 ambitions.
Proactive: Ben, I hope you'll continue to keep us posted on your progress. Thank you very much for the update today.