Toronto firm joins Shell on hydrogen

- Toronto-based Stuart Energy Systems Corp. and global oil giant Shell have struck a partnership to develop technology that would enable consumers to refuel hydrogen-powered cars at home.

Shell Hydrogen, a unit of the Royal Dutch/Shell Group, announced yesterday it had signed a marketing and technology development agreement with Stuart's Vandenborre Technologies of Belgium.

Financial terms were not disclosed.

Stuart is a developer of hydrogen fuelling stations and equipment. Vandenborre, recently acquired by Stuart for $10 million, builds equipment that produces hydrogen by passing electricity through water in a process known as electrolysis.

The technology is currently sold to customers in the industrial, transportation and power markets.

Vandenborre had been working on a relationship with Shell in Europe before being acquired by Stuart, said Tony Dundas, Stuart's chief financial officer.

"They had an edge on us in terms of developing that relationship, although it's been of interest to us for a long time as well," Dundas said in an interview, noting that Stuart benefits from Vandenborre's "better positioning" in the European market.

Yesterday's agreement gives Shell Hydrogen access to Vandenborre's electrolysis technology, which holds out the promise of hydrogen-fuelled cars getting overnight refills in residential garages.

Vandenborre's equipment converts water into a slow stream of hydrogen, emitting only oxygen.

Dundas said the equipment could also be used to fuel fleets of taxis, couriers and other commercial vehicles.

Field testing of a prototype of the home-hydrogen equipment is to begin within a year, initially targeting the European market.

Stuart is counting on widespread future use of hydrogen in vehicles using either fuel cells or internal combustion engines.

However, there's no certainty vehicles that run on hydrogen will be widely available within the next decade.