Is Natural Hydrogen The Way To Reach Net-Zero Carbon By 2050?

New Zealand might be sitting on a natural hydrogen factory that could deliver a thriving multi-billion-dollar, low-carbon hydrogen economy.

This possible game-changing scenario will be presented by Professor Ian Wright of University of Canterbury (UC) | Te Whare Wānanga o Waitaha School of Earth and Environment at today’s H2 2 ZERO Summit 2025 in Wellington.

Professor Wright is co-leading a research proposal with Professor Andy Nicol, in partnership with the Universities of Auckland and Otago, and GNS Science, that argues natural hydrogen could be the energy solution needed to help meet New Zealand’s climate change commitments. The Government is currently seeking public feedback on proposed regulatory options for the development of natural and orange hydrogen in Aotearoa.

Natural hydrogen is generated when ultramafic rocks are combined with water, resulting in a reaction known as serpentinization. If natural hydrogen is then trapped in geological reservoirs, it is referred to as gold/white hydrogen. Another option is injecting unserpentinized ultramafic rock with water in a controlled engineering process to create serpentinization – this is referred to as orange hydrogen.

New Zealand is one of a few sites globally where ultramafic ophiolite rocks are located at or near the earth’s surface and therefore could economically generate natural hydrogen. Professor Wright and Professor Nicol have proposed investigating two belts of ultramafic rocks in Aotearoa known as the Dun Mountain-Maitai Terrane and Brook St Terrane. These ultramafic belts can be traced above ground from Bluff, Southland, Nelson and D'Urville Island. In the North Island these terranes can be found less than 1km beneath Auckland, 1.5km beneath Waikato, and 3km beneath the surface in Taranaki. The Hikurangi Margin is another known location where sub-surface fluid flow (including possibly hydrogen) can occur naturally and be trapped.

Previous Ministry of Business, Innovation and Employment (MBIE) economic modelling forecasts a New Zealand hydrogen industry has a potential additional gross value of $NZ3.2 billion and could create 16,700 jobs by 2050.

A future source of hydrogen is needed to replace around 17% of carbon-emitting energy that is unable to be electrified. Another alternative is green, renewable hydrogen, but that is likely to be costly and require high investment.

“We are proposing that natural hydrogen, if proven to be viable, would require less capital investment, be cheaper, and would result in wider industry uptake,” Professor Wright says. “It would mean we can retain existing industries, build new industries, and because natural hydrogen has no CO2 emissions, there might even be ways we can lock CO2 up in the process, and create a net reduction of CO2. Science is providing a solution.”

New Zealand has the potential to become world leading in this area, according to Professor Wright, due to the country’s unique geological make up and long history of working with geothermal systems.

Professor Wright says the United States, Australia, and European countries are also looking at natural hydrogen as a viable alternative to fossil fuels to meet decarbonisation commitments. “New Zealand has two out of the four modes where natural hydrogen can be present,” he says. “We also have an established understanding in subsurface engineering and fluid flow – and we have a mindset of solving a problem. With that capacity we could develop natural hydrogen well.”

For New Zealand to reach net carbon zero by 2050, an estimated 80% of the economy will need to be electrified. The remaining 20% still requires hydrogen as a replacement for fossil fuels, such as in methanol production, long-haul trucking, and fuelling the Huntly Power Station. While renewable green hydrogen (hydropower, wind, solar) is one solution, Professor Wright says it would require high capital investment and would cost between $8-10 per kg. He estimates natural hydrogen could come down to $2-4 per kg with no CO2 emissions.

“Natural hydrogen offers a possibility to optimally decarbonise the remaining 20% of the economy that can’t be electrified.”

“As a nation, we have to ask the question: If we want hydrogen, are we willing to pay an additional $50b for every 1 million tonnes to have renewable green hydrogen, or have another form of hydrogen that is cheaper but not necessarily renewable?”

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