Of the many different types of hydrogen, natural hydrogen (sometimes called native, gold, or white hydrogen) has made headlines as a potential new renewable energy source.

It differs from other types of hydrogen in that it is not an energy vector but a primary energy source and therefore shares similarities with both fossil fuels and renewable energy.

Hydrogen: hype, hope and the hard truths around its role in the energy transition
Will hydrogen be the skeleton key to unlock a carbon-neutral world? Subscribe to the weekly Hydrogen Insight newsletter and get the evidence-based market insight you need for this rapidly evolving global market

There are few estimates of the size of this resource globally as a full understanding of how natural hydrogen is produced and accumulates has yet to develop.

Recent policy changes in South Australia have helped companies begin exploration drilling for natural hydrogen, which will accelerate understanding and potentially signal the start of an entirely new energy industry.

A brief history

Natural hydrogen seeps have been known since ancient times — the Flames of Chimaera in Turkey, the original source of the Olympic flame. Since then, the understanding that some gas seeps are hydrogen-rich developed in the late 19th Century with the discovery of hydrogen-rich gas in a coal mine by Dmitrij Mendelejev, father of the periodic table.

Then in the early 20th Century, two exploration oil wells drilled in South Australia on the Eyre Peninsula and Kangaroo Island encountered gas with very high hydrogen concentrations. But as the goal was hydrocarbons these discoveries were lost in history for the best part of a century. In 1987, a water borehole drilled near the village of Bourakebougou in Mali hit gas and exploded.

It was later discovered to have hit an accumulation of hydrogen with a purity of 98% — the highest recorded to date. In 2011, Petroma (now Hydroma) developed the borehole to produce hydrogen and run a small hydrogen internal combustion engine to provide electricity to the local village.

The company also embarked on an extensive drilling campaign in the area (Block 25) and established that the hydrogen accumulation extended for several kilometers. With zero pressure depletion detected, the hydrogen is likely being replenished.

With an estimated extraction cost in Bourakebougou of less than $0.50 per kilogram, this could be an extreme case as the well is less than 1,000 metres deep. Nevertheless, the potential for cheap hydrogen is promising and has prompted great interest in natural hydrogen exploration further afield.

But why are we only hearing about the potential of natural hydrogen now? To put it simply, no one has really been looking. Outside of academic studies on geology, weathering, radioactive waste disposal, and mid-ocean ridges no one has been purposely trying to measure hydrogen concentrations and exploit the resource.

Equipment used by the oil and gas industry has been tuned to look for and detect hydrocarbons, with older gas chromatography methods using hydrogen as a carrier gas and therefore unable to measure it in gas samples.

Several companies with experience in downhole measurement are now looking at the potential market for hydrogen detection equipment. Depending on developments over the coming 5–10 years, the market could become significant and potentially ease expected future global hydrogen supply shortages.

Fairy circles

In the past decade, research and reviews of the scientific literature have revealed that hydrogen can be associated with surface depressions with little vegetation known as fairy circles. Estimates of the hydrogen flux through fairy circles is up to three tonnes per day, with a global estimate of 23 million tonnes per year.

However, this does not include any hydrogen trapped in reservoirs in the subsurface, thus the actual resource may be much larger, and with such high fluxes, it is possible that reservoirs are being actively replenished.

This is thought to be the situation in Mali, meaning that natural hydrogen could be a renewable resource. The processes that generate hydrogen are uncertain but some key potential pathways are outlined below.

Key natural hydrogen production processes, environments and locations

There are six known ways in which hydrogen is produced naturally:


In which the mineral olivine located in mid-ocean ridges or ophiolites (a geological formation where sections of the Earth’s mantle rise above sea level) is weathered to form hydrogen-rich fluids. This has been seen in the Semail ophiolite, in the Hajar Mountains of Oman. Under pressure and high temperatures, water can react with these iron-rich rocks to produce H2.

Radiolysis of water

Radioactive elements in the Earth’s crust — for example in crystalline basement rocks with high content of uranium, thorium or potassium — decompose water molecules trapped in causing a hydrogen pocket, as happened in South Australia.

Deep degassing

In which “primary” hydrogen (a single hydrogen atom attached to a single carbon atom) escapes from deep within the Earth’s crust. This has been seen in Nebraska, in the US.

Iron reduction and sulphur oxidation

Ferric iron in a black smoker (a subsea hydrothermal vent formed from iron sulphide deposits) is reduced to ferrous iron and hydrogen sulphides.

Thermal decomposition of organic matter

In which ammonium compounds located in deep sendiments decompose under high temperatures to form hydrogen and nitrogen, for example in hydrogen-nitrogen gas seeps in Oman.

Biological activity

Hydrogen is produced by microbes living in the Earth’s crusts, usually co-existing with hydrogen-consuming microbes and found via sediment or aquifers. This has been observed in the coal beds of the Powder River Basin in Montana, US.

Source: Rystad Energy

Certain regions have high concentrations of fairy circles, and this has made them a target for further research and exploration. Hyterra (formerly Triple) has recently acquired a 30% stake in a joint development agreement with Natural Hydrogen Energy (aka NH2E) including an existing hydrogen exploration well that NH2E drilled in the US.

The well was drilled in the center of a 2.5km diameter fairy circle in the Salina Basin in Fillmore County, Nebraska in 2019 and claimed to have detected significant concentrations of hydrogen. The area is not known for its hydrocarbon prospectivity, but there is an ammonia plant supplied by an existing hydrogen pipeline nearby which would lend commercialization potential to any discoveries in the subsurface. Russia, Brazil, the US, and Australia are areas with high concentrations of fairy circles and the subject of research and interest from exploration companies.

The South Australian goldrush

Exploration permits for natural hydrogen exploration were made available in South Australia on 11 February 2021 when an amendment to the Petroleum and Geothermal Energy Regulations 2013 was made to include hydrogen, hydrogen compounds, and hydrogen by-products.

A slew of new exploration companies emerged, snapping up the newly available natural hydrogen exploration licenses in South Australia. The natural hydrogen community is focused on Kangaroo Island and the Yorke Peninsula where hydrogen concentrations of up to 84% were detected in the Ramsay Oil Bore 1 and American Beach Oil 1 exploration wells in the early 20th Century.

Gold Hydrogen acquired the license for this area (PEL 687) and estimated between 207,000 and 8,820,000 tonnes, with a best estimate of 1.3 million tonnes (unrisked prospect + lead) of hydrogen resources in the area.

If initial results prove promising, then the company is lined up to acquire 600km of area for seismic studies and drill a well in year five of the license.

This could mean a potential new natural hydrogen discovery by 2027. Other license applications in South Australia are also in progress. H2EX was recently awarded the rights to explore the area with PEL 691 in the nearby Eyre Peninsula in a partnership with CSIRO to investigate the mechanisms of natural hydrogen production with results expected at the end of the year.

Buru Energy subsidiary 2H Resources also applied for 29,000 square kilometres (about the area of Belgium) of permits for exploration in South Australia to develop and refine geological models with the joint aims of both hydrogen and helium production. Similarly, Byrock Resources, a new company just a year old, has applied for two licenses in the area too.

An industry in its infancy

From the 19th Century up to the present day, hydrogen has been detected in various places around the world but never fully investigated or exploited as hydrocarbon exploration was prioritised.

Now, as the energy transition is gaining momentum, considerable effort is going into understanding the processes behind hydrogen accumulations and a fledging exploration industry has appeared. If the efforts of companies pay off in South Australia, governments elsewhere are likely to follow suit and we may see a similar rush for exploration licenses in areas such as Brazil, Russia, and the US.

But, just like the oil and gas industry up until the 1960s, there is no need to fully understand the natural hydrogen system to exploit it. Until then, expect more hunting for fairy circles.