How to make the Southern Hydrogen Corridor a reality

The International Energy Agency stresses the important role that low-carbon hydrogen will play in the decarbonisation of hard-to-abate sectors such as heavy industry. To achieve this, we need to build the infrastructure to transport hydrogen from the supply to areas of high demand.

The planned Southern Hydrogen Corridor is emerging as a key piece in this puzzle, with a pipeline spanning 3300 km to connect North Africa's abundant low-carbon hydrogen potential with Europe's demand centres.

Crucially, this infrastructure will be ‘colour agnostic’, meaning it can support both blue and green hydrogen, provided the product meets emissions intensity thresholds. This approach will maximise the pipeline’s practical utility and contribute in the most impactful way to global decarbonisation and European energy security.

While this project has the potential to transform Europe's energy supply, several challenges must first be overcome to turn this cross-border initiative into a reality. Feasibility for the Southern Hydrogen Corridor hinges on sufficient demand as well as cooperation around infrastructure and regulation.

Marrying up supply and demand

North Africa’s renewable resources, particularly solar and wind energy, make it a region ripe for large-scale hydrogen production. That has been demonstrated through promising early-stage projects, such as Tarfaya Power-to-X and the Jorf Hydrogen Project in Morocco. Tunisia has high potential as a hub for production and export because it is strategically located just across the Mediterranean from major European markets.

The hydrogen produced in North Africa holds a clear cost advantage over domestic production in Europe, due to North Africa’s abundant renewable energy resources and existing infrastructure. Starting from this lower cost base strengthens the long-term economics of hydrogen imports, especially as scale, innovation and efficiencies drive prices down further.

 

On the demand side of the equation, prolonged geopolitical pressures have created more fragmented supply chains, highlighting the need for European hard-to-abate sectors to diversify their energy sources.

However, the transition for end users, particularly large gas consumers, requires targeted support. These industries face upfront costs to convert their infrastructure for hydrogen use, but also must account for hydrogen’s lower energy efficiency, typically delivering by volume around 70% of the usable energy of natural gas.

Establishing the right infrastructure

The process of building the right infrastructure brings with it complexities. The pipeline must be made at a scale that factors in greater flows of hydrogen in future because significant expansion will be costly to do at a later point. That adds to the initial capital expenditure (CAPEX) required. That cost can be partially mitigated by the approach taken by Snam, one of the transmission system operators (TSOs) leading the South Hydrogen Corridor project. Snam plans to repurpose existing natural gas pipelines for hydrogen transport, which could reduce the need for entirely new infrastructure.

Repurposing a pipeline is 80-90% cheaper than building a new one. With over 65% of the pipeline set to be made from repurposed infrastructure, the project will benefit from cost savings that will help secure investor confidence and increase the chances the project reaches financial investment decision (FID).

The Italian H2 Backbone component of the project will be composed of around 2300 km of pipelines and several hundred MW of compressor stations, which makes the country a key player as both a demand hub and stakeholder in the network. Therefore, the endorsement of the Italian government, backed by signed letters from two ministries, is a major milestone. However, national government support is only one layer of regulatory approval needed for a project of this scale.

Stakeholder cooperation is key

The success of the project hinges on sustained political will and regional cooperation. Political instability or governmental changes in participating countries could derail the project or hinder progress, making bipartisan support and long-term commitments from both public and private sectors essential to the project’s continuity.

The European Union plays a central role in this through the European Hydrogen Bank and other tools. Wherever possible, policymakers should combine subsidies, market incentives, and carbon pricing penalties to close the cost gap between lower carbon hydrogen and more carbon-intensive alternatives to ensure both production and transport remain economically viable.

Past projects like the Southern Gas Corridor have highlighted the importance of a strong facilitator to secure stakeholder alignment on these critical issues. bp’s involvement in that project, as both an investor and a coordinator, helped align various countries and secure the necessary financial backing.

A similar role for major energy companies in the Southern Hydrogen Corridor would help mitigate political risks and ensure the project’s success despite potential changes in leadership or policy. This role requires particularly skilful coordination, as hydrogen production, transportation and conversion projects need to achieve FID simultaneously in order to proceed.

The corridor to a lower carbon future

The Southern Hydrogen Corridor represents a significant shift in how Europe and North Africa will collaborate to meet the energy demands of the future. To progress this major project, policymakers, business leaders, investors and other stakeholders need to collaborate on a roadmap laying out every milestone needed to reach the final goal.

This roadmap must address practical and commercial factors, regulatory regimes, and it must set the stage for effective cooperation between stakeholders, ensuring the project has the strongest possible chance of success.

Read the article online at: https://www.worldpipelines.com/special-reports/30052025/how-to-make-the-southern-hydrogen-corridor-a-reality/