Eden Energy, a fully owned subsidiary of Tasman Resources, has taken a 20% stake in British company Brehon Energy, which bought the rights to hythane from its US developer.

Speaking the day before he was due to fly to China for talks with government officials, Eden chairman Greg Solomon told Energy Review.Net that the Chinese were eager to reduce air pollution in their major cities.

“With the 2008 Beijing Olympics and the Shanghai 2010 World Expo approaching, the Chinese Government wants to cut air pollution and make their cities more liveable,” Solomon said.

“Compared to methane, hythane can cut carbon dioxide emissions by 30% and nitrous oxide by 50%. The fuel can run in existing CNG engines and be delivered from existing fuelling stations. It is fully developed and immediately marketable.”

A hythane mix of 7% hydrogen by energy to 93% methane gives best combination of cost efficiency and energy reductions, according to Solomon.

He said hythane was particularly attractive for countries with existing natural gas infrastructure and third world countries that were not already irrevocably committed to petrol-powered cars.

“India has also expressed interest,” he said.

“China and India have huge bus fleets, so we are talking about enormous markets.”

Hythane was also attractive to countries such as China and South Korea because it could make use of hydrogen produced as a by-product from steel mills. This would give these countries two bites at carbon credits under the Kyoto Protocol – once for reducing emissions from steel production and a second time for reducing automotive emissions, which in third world countries would qualify for carbon credits.

Solomon believed the Kyoto Protocol would give an enormous boost to the alternative energy sector. The EU plans to begin carbon credit trading next year and with Russia seemingly committed to the system, he believed hythane and other alternative fuels would become commercially attractive options.

“Australia is hiding its head in the sand over carbon credits,” he said.

“With Russia coming on board, it’s clear that a substantial carbon trading market is emerging and big opportunities will become available. Concerns about global warming, the reliability of Middle East oil and declining oil reserves will only to the push for carbon trading.”