"White Hydrogen" Boom: A New Investment Opportunity for Rio Tinto, BP, and Bill Gates

From mining giants to energy giants, a growing number of major companies are beginning to embrace "white hydrogen," or naturally occurring hydrogen gas. As interest in the potential of this resource continues to rise, supporters believe that white hydrogen has the potential to completely reshape the global energy landscape.

Like fossil fuels, white hydrogen is a naturally occurring gas found beneath the Earth's surface. This long-overlooked resource was accidentally discovered in Mali, Africa, about 40 years ago. Since pure hydrogen contains no carbon, its combustion produces only gaseous water.

In recent years, investor interest in the emerging natural hydrogen industry has surged. Over the past year, several major companies have begun to support the sector, including mining giant Rio Tinto, Fortescue Metals Group, Gazprom, BP Ventures (the venture capital arm of BP), and Breakthrough Energy Ventures, founded by Bill Gates.

According to a research report by consulting firm Rystad Energy, natural hydrogen exploration is currently underway in multiple countries worldwide, with Canada and the US leading in the number of projects over the past year. Analysts expect this year to be a pivotal one, with industry insiders hoping to locate this rare gas through exploration activities as soon as possible.

However, not everyone is convinced of natural hydrogen's potential as a clean energy source. Critics have pointed out potential environmental issues and distribution challenges. The International Energy Agency (IEA) has warned that natural hydrogen "may be too dispersed to be extracted in an economically viable way."

Minh Khoi Le, head of hydrogen research at Rystad Energy, said it is currently difficult to predict whether natural hydrogen will deliver on its promises by 2025. "I think last year was when the natural hydrogen sector truly became interesting, as many companies began planning drilling and extraction tests, and major players started to join in," he said.

"However, progress has been relatively slow since then, with only a handful of companies actually starting drilling." Le, who last year described the global race for natural hydrogen as a "white gold rush," said that despite no major breakthroughs in the past 12 months, the growing investor interest could lead to meaningful outcomes.

Le told the media, "Now, we are starting to see some companies securing investments to fund their drilling projects. Therefore, if we want to know whether 'natural hydrogen is viable,' we may get preliminary answers this year."

Hydrogen has long been considered one of the key potential energy sources for the energy transition. Currently, most hydrogen is still produced by burning coal and natural gas, a process known as "gray hydrogen," which generates significant greenhouse gas emissions.

If carbon capture technology is added, the resulting hydrogen is called "blue hydrogen." Hydrogen produced using renewable energy is called "green hydrogen." However, the development of green hydrogen has been severely hindered by high costs and an unfavorable economic environment.

In August last year, Australia's HyTerra announced it had secured a $21.9 million investment from Fortescue Metals Group, which will be used to expand its exploration projects. A Fortescue spokesperson said the company's foray into natural hydrogen aligns with its strategic commitment to "explore zero-emission fuels."

Fortescue also acknowledged that more work is needed to fully assess the emissions profile of natural hydrogen but described the technology as a "promising opportunity to accelerate industrial decarbonization." Meanwhile, earlier in the year, BP Ventures, the venture capital arm of BP, led the Series A funding round for UK-based natural hydrogen startup Snowfox Discovery.

French startup Mantle8 also recently secured a €3.4 million seed funding round, with Breakthrough Energy Ventures, founded by Bill Gates, among the investors. Eric Toone, chief technology officer of Breakthrough Energy Ventures, said the fund supports Mantle8 and US startup Koloma because the potential of natural hydrogen could "usher in a new era of clean, localized energy."

Toone also said, "Hydrogen itself is pure reaction energy. If we have enough of it and it's cheap enough, we can do almost anything. We can make metals, produce fuels, and even manufacture food, all with far fewer emissions than traditional methods."

"We know that natural hydrogen is widespread, not just sporadically distributed. Early exploration has already discovered natural hydrogen on six continents. The current challenge is how to extract it efficiently, transport it safely, and establish systems to utilize it," he said.

Aurian Durbuis, an executive at Mantle8, said that from a venture capital perspective, the momentum is indeed growing. "Interest is definitely increasing, especially considering the current challenges in the green hydrogen sector. People are starting to look at other solutions, which works in our favor," he said.

"The question is whether we can find exploitable reservoirs—using oil and gas industry terminology. That's the problem the entire industry needs to solve," Durbuis said. "We expect to drill in 2028 and hope for an 'Euclid moment' by then. If we can find high-concentration, high-pressure hydrogen, everything will change."

However, the Hydrogen Science Coalition, an industry organization, said that natural hydrogen exploration is still in its "infancy," and even so, the likelihood of large-scale discoveries of exploitable, high-purity hydrogen remains "relatively slim."

Arnout Everts, a scientist and member of the coalition, pointed out, "If we use the US shale gas revolution as an analogy, even if large-scale discoveries are made in the future, it could take decades to achieve industrial-scale production." The organization warned that the hype surrounding natural hydrogen could divert attention from the urgent need for renewable hydrogen, which is crucial for current industrial decarbonization efforts.