The oil and gas major is seeking a Development Consent Order (DCO) from the government after Redcar and Cleveland Borough Council approved landowner South Tees Group’s (STG) bid to build one of Europe’s largest data centres.
Reports state that Teesworks Ltd has objected to BP’s plans, arguing the hydrogen and carbon capture scheme would render the proposed data centre, planned on 115 acres earmarked for H2Teesside, unviable.
BP, meanwhile, told H2 View it is willing to find a “position of co-existence” that allows both developments to move forward.
“The DCO process for the H2Teesside project is well advanced, and in light of a planning application being approved, which overlaps substantially with the proposed hydrogen production facility, we will now take the time to consider this decision in line with our proposals,” a BP representative told H2 View.
“H2Teesside has for some time been seeking to find a position of co-existence with South Tees Group in respect of both parties’ aspirations for Teesworks, and it remains willing to continue those discussions on proposals that would enable both developments to co-exist.”
Despite BP’s request to delay a decision pending the DCO outcome, the council approved Teesworks’ data centre plan less than a week after receiving its objection.
Planning consultancy Lichfields, representing Teesworks, disputed BP’s claims, stating there is “increasing uncertainty” around BP’s commitment and funding for H2Teesside.
In May, reports suggested BP might cut its 1.2GW project by up to 75% or cancel it, amid offtake challenges and Sabic’s pause on its Teesside plant. While associated CCUS projects reached FID last year, the blue hydrogen production project has seen no such progress.
Lichfields argued that the data centre is aligned with Teesworks’ pivot to become part of the UK’s Artificial Intelligence growth zone, attracting major private investment.
BP’s consultants DWD responded. They stressed that the projects are “physically incompatible” due to hazard zones and planning limits, calling the data centre plan “speculative” and lacking key environmental details, although this was refuted by Lichfields.
The planning and development consultancy stated that the application was submitted in line with existing planning permission and reflected ongoing discussions with an end user.
It added that until BP is granted a DCO with compulsory acquisition powers, Teesworks retains full legal rights to develop its approved scheme.
The Department for Energy Security and Net Zero (DESNZ) is set to rule on BP’s application by 28 August 2025. Approval would give BP the power to acquire the land – potentially overriding the approved data centre plans.
Despite reports of internal uncertainty, a BP spokesperson told H2 View that H2Teesside remains a nationally significant project, vital to the UK’s hydrogen goals and Teesside’s economic growth.
H2Teesside was first announced in 2021 and is positioned to deliver 10% of the UK’s 2030 hydrogen production target. At full capacity, it’s set to produce 160,000 tonnes of low-carbon hydrogen per year.
