Techno-Economic Assessment of Offshore Green Hydrogen Energy Hub Facilities to Decarbonize UK Continental Shelf Oil and Gas Producing Assets

Abstract

Mature offshore oil and gas basins worldwide face critical decarbonization imperatives as the energy industry transitions toward Net Zero commitments, with traditional gas turbine power generation representing the dominant source of platform greenhouse gas emissions. This paper presents a comprehensive techno-economic framework for offshore green hydrogen energy hub facilities utilizing existing offshore wind infrastructure to decarbonize producing assets, with detailed application to the UK Continental Shelf (UKCS) as a representative mature basin. With greenhouse gas emissions from traditional power generation accounting for 79% of offshore production emissions, this assessment demonstrates how transforming 1.83 GW continuous power demand across over 65 UKCS producing platforms can achieve 6.8 Million Tons of Carbon Dioxide Equivalent (MtCO2e) annual emissions reduction through integrated green hydrogen power systems, providing a methodological template transferable to other offshore basins globally. A mixed-method approach combining quantitative technical analysis with economic evaluation frameworks was applied, utilizing a Factor-Based Matrix Model to correlate producing asset size, age, and production volumes for energy consumption profiling. A Multi-Criteria Decision Analysis (MCDA) evaluated green hydrogen electrolyzer and fuel cell technologies across five weighted criteria: technical performance (41.6%), marine environment compatibility (26.2%), operational considerations (16.1%), installation requirements (9.9%), and economic factors (6.2%). The economic feasibility assessment utilized Net Present Value (NPV), Internal Rate of Return (IRR), and payback period calculations with sensitivity analysis for carbon pricing (USD 60 to 108/tCO2), technology cost reductions (35 to 40% system-wide by 2030), and operational efficiency parameters (±15%). The Comprehensive Offshore Green Hydrogen Framework integrates UKCS offshore windfarms with spare capacity to produce green hydrogen, considering critical environmental parameters including wind speeds (7 to 10 m/s), water depths (40 to 180 m), operational temperatures (-5 to 25 °C), and salinity effects on equipment specifications. Analysis reveals Proton Exchange Membrane (PEM) technology as optimal for both electrolysis (0.739 MCDA score) and fuel cell applications (0.713 MCDA score) in offshore environments. The study identifies nine strategic green hydrogen production hubs requiring 1,800 MW electrolyzer capacity, with system-wide hydrogen consumption of 854,450 tons annually calculated on a demand-side basis accounting for fuel cell electrical efficiency, system losses, and peak load provision. Detailed economic evaluation of Hub 4 facility in the Central North Sea Forties Cluster, serving 27 platforms with USD 4.88 billion capital investment, demonstrates current commercial viability with Net Present Value of approximately USD 142 million at current UK Emissions Trading Scheme carbon pricing of USD 67/tCO2, with break-even at approximately USD 57/tCO2. Annual net cash flow of approximately USD 553 million derives from avoided gas turbine power generation costs of USD 523 million, avoided carbon costs of USD 104.5 million, hydrogen sales of USD 37.5 million, and wind curtailment value of USD 10 million, less annual operating expenditure of USD 122 million. Total system-wide investment of USD 23.6 billion achieves commercial viability under projected 2030 carbon pricing of USD 108/tCO2 and technology cost reductions, with system Net Present Value improving from negative USD 2.8 billion under current conditions to USD 6.4 billion. Phased implementation spanning 2028 to 2036, with pilot deployment at Hub 4 during 2028 to 2030, capitalizes on technology maturation, favorable environmental conditions, and expanding offshore windfarm spare capacity availability. This work presents a novel techno-economic framework for offshore hydrogen integration in oil and gas operations, demonstrating that Hub 4 achieves current commercial viability at existing UK ETS carbon pricing with break-even at USD 57/tCO2. The Factor-Based Matrix Model provides a standardized energy assessment methodology applicable across diverse platform configurations in any offshore basin, while comprehensive economic analysis incorporating full gas turbine power generation cost avoidance addresses critical knowledge gaps in offshore decarbonization economics. The systematic methodology combining technical screening, technology selection, and financial evaluation offers a transferable approach for assessing offshore hydrogen feasibility in mature basins worldwide, with practical guidelines for equipment selection, hub positioning, and pipeline design supporting evidence-based policy development and investment decisions.