Natural Gas versus White Hydrogen In a July Yahoo post, I talked about delivering white hydrogen at a price lower than natural gas.  That was misleading as I seemed to be saying that could be done now.  Given current natural gas prices and the cost of building pipelines and hydrogen purification facilities, competing on price now is not realistic.  However, I strongly believe that it will be within the next ten years. Demand for natural gas is likely to exceed supply around 2030, and supply cannot be increased without multi-billion dollar investments in exploration and facilities.  The source of this information is the 2025 Global Gas Report of the International Gas Union, an association of natural gas producers.  I recommend downloading and reading the free report even though it requires registration on IGU’s website. In addition to mentioning that demand will exceed supply by the end of the decade, the report specifically recommends the development of diverse sources of energy such as hydrogen.  The “end of the decade” sounds like a long way away, but certainly is not for planning and investment purposes. Comstock’s investment in the Western Haynesville Shale Basin has attracted recent news coverage.  Comstock estimates that the area could have natural gas deposits worth $100 billion.  But it’s a measure of the lengths to which natural gas exploration must go when a company undertakes to drill at 14,000 to 19,000 feet to extract gas from mud in a location where wildcatters and even corporate explorers like OVV have abandoned their efforts because of the extreme pressures.  Still, investors are flocking to Comstock in droves. So why is HyTerra literally a penny stock?  I think it is because the company is run by geologists and petroleum professionals, not marketers.  Their website shows a basic misunderstanding of the purpose of websites.  The primary purpose is not to document an enterprise’s accomplishments but rather to attract customers and investors. To attract investors, there must be enough information to show that the company is capable of making a ton of money.  HyTerra’s website talks a lot about the 92+ purity percentage of the hydrogen extracted from its first drilling site, but when it talks about markets for its products, it mentions nearby ethanol and ammonia plants as customers.  I hate to say this, but if HyTerra’s marketing objectives are to sell hydrogen to Kansas ethanol and ammonia plants, they’ll never make a ton of money. The market that counts, the big market, is electrical power generation.  The United States is starved for electrical energy, and demand will increase substantially as the conversion to electric vehicles and the building of data centers continues.  Hydrogen can be used to generate electricity immediately, and the sooner HyTerra shows that it can produce and deliver subsurface hydrogen for electrical energy production, the sooner it will attract investors, generate substantial revenues, and zoom out of the penny range. The next post covers what I believe are specific failures in HyTerra’s marketing messages, failures that have inhibited investor interest to date. HyTerra notes that it aware of the power generation market by including it in slide 8 of the most recent Corporate Presentation.  It is listed as an emerging market.  The HyTerra message included the statement "we are very confident that there is a market for our hydrogen."  My reaction is that of course there are various markets currently served by "gray" hydrogen producers and HyTerra should be able to compete on price.  The issue is one of priorities.  Power generation should be the #1 market for development.  I stand by my statement two paragraphs above.