Hanwha Solutions, the chemical arm under Hanwha Group, said Thursday that it will begin supplying hydrogen fuel to car parts company Hyundai Mobis, a step toward a more active role in the expanding hydrogen market.

The company’s plan is to produce a total of 48 tons of hydrogen over two years starting in July, and gradually increase the supply in line with the establishment of related infrastructure.

The move marks the chemical company’s foray into the country’s automotive hydrogen fuel cell market, which is projected to reach 3.2 trillion won ($2.86 billion) annually by 2030, according to industry sources.

Hyundai Mobis, the parts maker affiliated with the country’s largest automaker, Hyundai Motor, is currently building a hydrogen charging network at highway service stations across the country.

The hydrogen fuel will be produced at Hanwha Solutions’ caustic soda production site in Yeosu, where sodium chloride, or salt, is dissolved in water through a purification process.

After any impurities are removed, the salt water is put in an electrolyzer to be broken down into chlorine, caustic soda and hydrogen. The company said the process is eco-friendly as it does not create air pollutants.

The refining process results in hydrogen fuel for cars with a purity level of 99.999 percent before it is supplied to local hydrogen-charging stations, the company added.

“Through this project, we plan to gradually increase hydrogen fuel for cars and create a basis for a hydrogen value chain ranging from production to supply,” the company said in a statement.

The company also said it is teaming up with the Korea Gas Technology Corporation to build a facility and a charging station that can produce up to 290 tons of green hydrogen each year in Daegwallyeong, Pyeongchang, sometime in the second half of next year, with plans to operate them for 15 years.

By Yim Hyun-su (hyunsu@heraldcorp.com)