Tulum Energy Raises $27M to Scale Methane Pyrolysis for Low-Carbon Hydrogen Production in Mexico

Tulum Energy, a clean tech startup born from Italian and Mexican roots, just landed $27 million in funding to kick off a bold new project in Mexico—a methane pyrolysis-based hydrogen pilot plant.

With backing from Techenergy Ventures (part of the Techint Group), the company is setting its sights on something big: producing affordable, low-emissions “turquoise hydrogen.” This high-potential fuel is made by breaking down methane into hydrogen and solid carbon—without releasing any CO₂ in the process.

Targeting cleaner steel through direct reduced iron (DRI)

The project isn’t going it alone. Tulum is teaming up with Latin American steel giant Ternium to explore how this cleaner hydrogen could fuel direct reduced iron (DRI) production—a key step in making steel more climate-friendly. If this works as planned, it could seriously cut down on industrial emissions and offer hydrogen prices that compete with fossil-based options, targeting around $1.50 per kilo.

Old tech, new tricks

Interestingly, methane pyrolysis isn’t a brand-new idea—it’s tech that’s been sitting on the shelf for years. But now, thanks to advanced materials and better process optimizations, it’s getting a modern reboot with huge potential in hydrogen production and industrial decarbonization.

Why Mexico makes sense

Mexico’s rich natural gas reserves and strong industrial base make it a smart launchpad for this kind of innovation. The hope is that this pilot could not only change the economics behind hydrogen but also speed up sustainable energy solutions in heavy industry—without the steep costs and infrastructure hurdles that green hydrogen projects often face.