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BP scraps plans for Teesside hydrogen and carbon capture scheme

BP abandoned its £4.5 billion hydrogen project at Teesworks due to local approval of a large AI data centre and reduced industrial hydrogen demand, increasing project risk.

  • On Monday, BP withdrew its application and scrapped the H2Teesside project after clashing with rival plans at the Teesworks site at the former Redcar steelworks.
  • Site owners backed plans for a large AI data centre and Redcar and Cleveland council granted permission in August, while BP said hydrogen demand in Teesside deteriorated as major industrial consumers scaled back decarbonisation.
  • Seeking powers to compulsorily purchase land, BP's H2Teesside was planned in two phases costing 2.3 billion and 2.2 billion, with Lord Houchen saying it could attract £100 billion of AI investment.
  • A BP spokeswoman said it will continue other Teesside projects including Net Zero Teesside and the Northern Endurance Partnership, while the energy department spokeswoman said routes remain for Tees Green Hydrogen moving towards a final investment decision.
  • Government ministers were split over the competing proposals, with the prime minister and Peter Kyle backing the data centre while Ed Miliband delayed his decision until this week, supporting BP's plans.
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The Times broke the news in United Kingdom on Monday, December 1, 2025.
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