Baker Hughes to Supply Snam with Hydrogen-Ready Technology to Support Decarbonization and Resilience of the Italian Gas Network
- None.
- None.
Insights
The recent contract between Baker Hughes and Snam for the supply of NovaLT™12 gas turbines is a strategic move in the energy sector, specifically within the context of Europe's energy transition efforts. The turbines' ability to operate on a hydrogen blend is a significant technological advancement, given the increasing focus on hydrogen as a low-carbon fuel alternative. This development is especially pertinent as Europe seeks to diversify its energy sources and reduce reliance on fossil fuels, in line with the REpowerEU Plan.
From a business perspective, this contract could bolster Baker Hughes' position in the market for low-carbon energy technology. The adoption of such technologies by major infrastructure projects indicates a growing market demand, which could lead to increased revenue streams for companies like Baker Hughes. Furthermore, the partnership with a major player like Snam could serve as a reference point for future contracts, enhancing Baker Hughes' reputation as a leader in energy transition technologies.
The inclusion of Baker Hughes' NovaLT™12 turbines in Italy's National Recovery and Resilience Plan signifies a policy shift towards infrastructure that is compatible with future energy sources, such as hydrogen. This move aligns with the European Union's broader environmental objectives and demonstrates how public policy can drive the adoption of innovative technologies. The potential impact on Italy's carbon footprint could be substantial, considering the pipeline's role in the decarbonization of the gas network and the broader goal of achieving carbon neutrality on direct emissions by 2040.
For investors and stakeholders in the energy sector, such policy-backed projects may offer a degree of security, as they are likely to receive sustained support. However, the long-term success of these projects will depend on the continued development of the hydrogen market and related infrastructure. Stakeholders should monitor the evolution of environmental policies and market trends closely to assess the viability and profitability of similar investments in the future.
The financial implications of Baker Hughes' contract with Snam are multifaceted. On one hand, the immediate revenue recognition from the contract will positively impact Baker Hughes' financials in the short term. On the other hand, the strategic nature of the contract could have long-term benefits, potentially leading to future contracts and partnerships in the rapidly evolving hydrogen market.
Investors should note that the energy technology sector is highly competitive and Baker Hughes' ability to secure such contracts is indicative of its competitive edge. However, they should also consider the capital-intensive nature of the energy sector and the risks associated with the adoption of new technologies. It is essential to evaluate Baker Hughes' R&D expenditure, the scalability of its hydrogen technology and the potential return on investment from these innovations.
- Baker Hughes will supply Snam, a leading European energy infrastructure company, with three turbocompressors driven by NovaLT™12 gas turbine technology, offering fuel flexibility of up to
10% hydrogen blend with natural gas - Award marks another significant milestone in the decarbonization of Italy’s gas network infrastructure and builds on the long-standing collaboration between the two companies
FLORENCE, Italy, April 03, 2024 (GLOBE NEWSWIRE) -- Baker Hughes (NASDAQ: BKR), an energy technology company, announced Wednesday it was awarded a contract to be booked in the first quarter of 2024 from Snam, Europe’s leading operator in natural gas transportation, storage and regasification, to provide three NovaLT™12 gas turbine driven compressor trains for a new gas compressor station in Sulmona (Italy).
The station is an integral part of Adriatic Line, a Snam pipeline project, whose first phase was included in Italy’s National Recovery and Resilience Plan (PNRR) as part of the REpowerEU Plan and therefore deemed eligible to be financed. The Adriatic Line entails the construction of a 425 km long, hydrogen-ready pipeline to allow the transport of additional energy supplies from Azerbaijan, Africa and the Eastern Mediterranean region to northern Europe.
The adoption of Baker Hughes NovaLT™12 turbines, which provide the option to run on
The contract, which was awarded to Baker Hughes following a public tender, builds on a long-standing collaboration between the two companies that has involved the successful testing, in 2020, of the world’s first “hybrid” hydrogen turbine designed for a gas network, and the installation of a NovaLT™12 turbine at Snam’s Istrana, Italy, site in November 2022.
“This milestone in our long-standing collaboration with Snam demonstrates that the energy transition requires continuous partnership. Together, we are innovating and delivering critical world-firsts for the decarbonization of gas networks,” said Ganesh Ramaswamy, executive vice president, Industrial & Energy Technology at Baker Hughes. “Our work with customers and partners is part of our commitment to developing innovative technology solutions, such as the NovaLT™12, that enable the decarbonization of energy ecosystems and the creation of the hydrogen economy while continuing to support the need for an affordable and secure energy supply.”
In January 2024, Baker Hughes shared an update on several milestones on some of its most significant and active hydrogen projects, including: a new hydrogen testing facility in Florence, Italy; the completed manufacturing and testing of its NovaLT™16 hydrogen turbines for the Air Products Net-Zero Hydrogen Energy Complex in Edmonton, Canada; and progress on another key Air Products project with the delivery of the first two trains of advanced hydrogen compression solutions for the NEOM project in Saudi Arabia, the largest green hydrogen project in the world.
Baker Hughes’ advanced technologies and solutions serve the entire hydrogen value chain, from production to transportation and utilization. The company’s experience in hydrogen projects dates to the 1910s, and its portfolio includes advanced compressors, gas turbines, valves, centrifugal pumps, non-metallic pipes, hydrogen sensors, monitoring and diagnostics including inspection solutions for hydrogen embrittlement in production and storage, as well as clean power solutions to produce power with hydrogen and hydrogen blends.
About Baker Hughes
Baker Hughes (NASDAQ: BKR) is an energy technology company that provides solutions to energy and industrial customers worldwide. Built on a century of experience and conducting business in over 120 countries, our innovative technologies and services are taking energy forward – making it safer, cleaner and more efficient for people and the planet. Visit us at bakerhughes.com.
For more information, please contact:
Media Relations
Chiara Toniato
+39 3463823419
chiara.toniato@bakerhughes.com
Investor Relations
Chase Mulvehill
+1 281-809-9088
investor.relations@bakerhughes.com
FAQ
What technology will Baker Hughes supply to Snam?
What is the fuel flexibility offered by the NovaLT™12 gas turbine technology?
What project is the contract part of?
What is Snam's strategy regarding carbon neutrality?
What are some of Baker Hughes' other hydrogen projects?
