Oil company Royal Dutch Shell is to work with the Dutch government and a bus company to produce a number of buses that run on hydrogen fuel.

It is thought to be the largest fuel cell public transport project yet undertaken.

"This is an important milestone for Shell Hydrogen as we take the next steps towards Royal Dutch Shell's fuels strategy of providing sustainable mobility to people around the world," said Duncan Macleod, vice president Shell Hydrogen.

"Our aim is to establish strong alliances in order to realise this ground-breaking project and we are confident that commitment of all parties can bring an exciting and rewarding result."

More than 20 of the buses will be produced under the project, with the hydrogen-fuelled engines produced by bus company Man and operated by a main operator in the Netherlands, Connexxion.

The hydrogen refuelling station will be built by Shell and the whole operation should be ready for passengers by 2009.

Rein Willems, chairman of Shell Netherlands, added: "We will be showcasing hydrogen as a reliable, safe and sustainable fuel which contributes to the reduction of local air pollution and strengthens economic growth."

Public reaction and economic benefits produced by the project will be assessed over a five-year period.

Platinum and palladium have been used in cutting edge technology in hydrogen storage as well as in the process by which hydrogen is converted into fuel.

Ÿ Adfero Ltd