Outside Thetford Mines, Quebec, a region historically known for asbestos mining, a start-up company is conducting underground drilling in pursuit of a new source of clean energy. Vema Hydrogen has drilled two wells, each about 1,000 feet (300 meters) deep, into iron-rich bedrock and is injecting treated water to stimulate chemical reactions intended to generate hydrogen fuel.

Hydrogen, which produces only water vapor when burned, is seen by many as a promising alternative to fossil fuels in sectors difficult to decarbonize, such as shipping, aviation, steel production, and chemical manufacturing. However, producing hydrogen in an environmentally friendly and cost-effective manner remains a significant challenge. Currently, most commercial hydrogen is derived from natural gas, a process that emits substantial greenhouse gases. Efforts to produce so-called “green” hydrogen using wind and solar power have proven costly and technically demanding.

Vema’s approach focuses on the natural geological processes that generate hydrogen underground, known as geologic hydrogen. This hydrogen forms when iron-rich minerals in rocks react with water through serpentinization, a reaction that can occasionally result in accumulations of extractable hydrogen gas. While initially believed to dissipate quickly, discoveries since the 1980s—such as a natural hydrogen well in Mali—have demonstrated the potential for significant reservoirs.

Scientific interest in geologic hydrogen has increased in recent years. The U.S. Department of Energy estimates that producing hydrogen from these underground sources could cost less than $1 per kilogram, undercutting fossil-fuel-based and renewable hydrogen production. Several start-ups, including Koloma and Australia’s HyTerra, are exploring sites across North America, with mixed early results. Challenges include the high costs of drilling, uncertain hydrogen yields, and the potential environmental impact of exploration activities.

Vema’s test site near Thetford Mines sits on ophiolite formations, rock structures formed over 400 million years ago consisting of serpentinized materials rich in iron. The company is experimenting with accelerating serpentinization by injecting water and optimizing temperature and pressure conditions. The aim is to generate steady hydrogen flows economically viable for commercial production. However, experts caution that technical hurdles remain, including preventing hydrogen gas from escaping through fractures and managing seismic risks associated with fluid injection.

If Vema’s methods prove successful, the company aims to begin full-scale hydrogen production by 2028. The fuel may be used close to its extraction site because hydrogen storage and transport pose logistical challenges. One potential application is producing methanol, a clean-burning liquid fuel for ships pressured by international regulations to reduce emissions. Local companies in Quebec are also exploring producing green methanol using hydrogen, although cost competitiveness remains critical.

Other proposed uses include synthesizing methane to replace conventional natural gas in industrial and heating applications. Vema has raised $15 million to date and is evaluating other geological sites along the Pacific Coast of North America. Additional research is ongoing worldwide, including at institutions such as the Massachusetts Institute of Technology and universities studying hydrogen generation in ophiolite-rich regions like Oman.

While the feasibility of geologic hydrogen as a major energy source is not yet established, experts agree the concept is no longer purely theoretical. The focus now is on demonstrating economic viability and scaling production to meet global clean energy demands.