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Fort Peck tribes, energy coalition propose multi-billion hydrogen project in Montana

Posted at 1:43 PM, Mar 30, 2023

A group of investors, a coalition of companies and the Fort Peck Indian Community are making a multi-billion bid to make Montana an early leader in hydrogen energy in a project that would make a new facility carbon neutral and add hundreds of jobs when completed.

CYAN H2, led by principals John Mues and Ray Johnson of Montana, are moving ahead with a partnership with the Fort Peck tribes that would take water from the Missouri River, wind energy, and natural gas and use them to make both hydrogen fuel as well as fertilizer, while shipping the excess carbon for sequestration near the Bakken oil field, reports the Daily Montanan.

Mues is a Navy veteran, including graduating from the U.S. Naval Academy, a former high school teacher, an oilfield engineer and now involved in the energy sector. He ran in the Democratic primary against former Gov. Steve Bullock to face incumbent Sen. Steve Daines in 2020. Bullock handily defeated Mues.

Mues told the Daily Montanan that nearly a dozen corporations would support various aspects of the project, which could be an economic boon to northeastern Montana, help ease the agricultural fertilizer crisis exacerbated by the war in Ukraine, and help make the Treasure State a leader in renewable energy, possibly providing an answer to the longtime question: What to do with Colstrip?

Colstrip is home to four coal-fired electricity generating units, all of which are either scheduled or have already been sunset. That has left energy companies and state leaders scrambling to figure out how to keep the plant operational for the jobs it sustains, as well as leaving a question mark about how Montana and the intermountain West will replace the power generation.

The hydrogen project, called the Assiniboine-Sioux Hydrogen Company, would take water from the Missouri River, and electricity from wind farms to create the components of both fertilizer and hydrogen gas. A large natural gas pipeline would also provide some of the components.

The chemical process would create nitrogen for fertilizers to be used in Montana’s “Golden Triangle” while shipping the rest to the Midwest. Then, hydrogen fuel would be transported using some existing pipeline routes, including part of the pipeline scoped for the Keystone XL project, which was scrapped.

Mues said a pipeline could carry hydrogen, which would be used in other American locations, rather than using a crude oil pipeline to ship Canadian crude from the Tar Sands for export.

The carbon that is created from the project would be either sequestered or used in the fracking process to extract more crude oil. The hydrogen fuel could be piped to other facilities, including power plants like Colstrip, which could be converted to burn hydrogen fuel, rather than coal or natural gas. Mues pointed to a number of companies that are building vehicles, including trucking fleets, that are switching to hydrogen fuel, or a mix, similar to how ethanol is blended with gasoline.

In turn, he said that not only could Montana become a leader in the nascent hydrogen industry, it could be an economic boon for the impoverished Fort Peck community, and also nearby towns that have been reeling from the closure of a sugar refinery in Sidney and a mine closure in Savage.

Mues and the group hope to be part of Gov. Greg Gianforte’s compact with area states, called the Heartland Hydrogen Hub, which supports the use of hydrogen technology in future energy development.

Mues said the Gianforte administration has been unresponsive as to whether it supports such a project. In its efforts to support hydrogen the Biden Administration has also asked states to reach out to Indigenous nations for opportunities. The Heartland Hydrogen Hub is one of several areas to receive consideration from the Biden Administration for building out more energy infrastructure.

Officials from Fort Peck said no one from the state has contacted it about this project or other energy development.

“These are not scraps off the table,” Mues said, “But the Fort Peck tribes are the undiluted financial owners and this has the potential to change the area in a very transformative way.”

The Daily Montanan reached out to both Gianforte’s office as well as the Montana Department of Commerce, but did not receive responses about the project or idea.

Mues also said officials had briefed U.S. Sen. Jon Tester of Montana, a Democrat, on the concept.

“Senator Tester knows that increasing domestic energy production is critical to lowering costs for families and small businesses across the Treasure State, and Montana should be a leader in powering our country with American energy. He looks forward to seeing where this partnership leads and supports the Fort Peck Tribes’ efforts to diversify our energy portfolio,” said a spokesperson from Tester’s office on Tuesday.

Wind, then hydrogen

The project would be wind powered, using the power generated by wind turbines capable of producing as much as 1 gigawatt. That would make it the largest windfarm in Montana. Water taken from the Missouri River would be electrolyzed to break it into component parts, like hydrogen.

While the area on the Fort Peck reservation is generally not optimal for wind generation, it will supply enough to fuel the plant, and possibly return some excess to the grid.

Natural gas from a TransCanada pipeline runs nearby and can be used for the production of fertilizer for farming.

The leftover carbon can be permanently sequestered in the Bakken region or shipped to other regions via pipelines for enhanced oil recovery. Mues said the process will make the project net zero carbon emissions.

Mues and the Fort Peck tribes estimate that the different aspects of the project will create 1,500 sustainable jobs when all phases of the Assiniboine-Sioux plant are built out.

A hydrogen future?

Mues said hydrogen may be part of the future of energy. For years, manufacturers have wrestled with how to integrate the technology, using the most common element in the universe.

Now, many of those ideas have started to come to market. For example, a power generating plant in Delta, Utah, uses a natural gas-hydrogen mix of fuel, and will gradually become 100% hydrogen fuel. Large semis, some ships and even airplanes are looking at investing in hydrogen technology. Mues said because of that, such a plant could be on the brink of huge economic opportunity.

Also, by piggybacking off existing pipeline routes or ones that have been permitted, the project would likely meet fewer permitting hurdles.

“We’re always looking at the natural resources we have – our wind, water and land,” said Rodney Miller, the Fort Peck Tribes chief economic development officer. “We want it to strengthen and diversify us to help with sustainability.”