Japan has forged an agreement with the United Arab Emirates under which the two countries will “accelerate the bilateral cooperation in the fields of fuel ammonia and carbon recycling.”
Infrastructure is key to realising the full potential of ammonia energy, enabling new markets and expanding the existing ones. By 2050 the hydrogen (and by extension, ammonia) market could be 20 times larger than it is today. What future possibilities are there to expand global ammonia production (currently 180 million tonnes per year) or trade volumes across the world’s oceans (currently 18 million tonnes per year)? On November 18, 2020, the Ammonia Energy Association (AEA) hosted a panel discussion moderated by Daniel Morris from KBR, as well as panel members Anthony Teo from DNV GL, Oliver Hatfield from Argus Media, and Michael Goff from Black & Veatch as part of the recent Ammonia Energy Conference. The panel’s insights from a number of different perspectives - market analytics, ship building and operating, as well as pipeline engineering - demonstrated ammonia's potential to become a low- or zero-carbon fuel of choice for the future. Current infrastructure can be adapted, new infrastructure can be built and operated cheaply, and lessons from previous fuel transitions can be taken on board to make the uptake of ammonia energy as smooth as possible.
Last month UN Climate Change announced an initiative whose goal is to scale up green hydrogen production significantly over the next six years. “The new ‘Green Hydrogen Catapult’ initiative will see green hydrogen industry leaders, including ACWA Power, CWP Renewables, Envision, Iberdrola, Ørsted, Snam, and Yara, target the deployment of 25 gigawatts through 2026 of renewables-based hydrogen production, with a view to halve the current cost of hydrogen to below US$2 per kilogram.”
NH3 Event Europe Foundation and the Arab Fertilizer Association (AFA) will join forces in NH3 Arab Events to host two digital events, on December 8 and 9, 2020, on the topic of green NH3 in the Arab world. Our aim of organizing these events is to build knowledge and share information about green ammonia possibilities in the Arab world.
If ammonia is to be introduced into the energy system as a CO2-free fuel, its cost must be at least competitive with that of other CO2-free fuels such as CO2-free hydrogen. In the discussion below I consider the cost aspect of CO2-free ammonia. To state my conclusion at the beginning, the cost of CO2-free ammonia can be less than 30 yen/Nm3-H2, which is the 2030 cost target for hydrogen energy set by the Japanese government in its "Basic Hydrogen Strategy” for introducing hydrogen energy into Japan.
Last week, Saudi Aramco and the IEEJ attracted significant media attention when they announced that the first “blue” ammonia has been shipped to Japan. Aramco’s celebration of this shipment of 40 tons of ammonia (not 40 thousand or 40 million, just 40 tons) raises many questions, but makes three things clear. First, projects to demonstrate the carbon footprint of specific batches of low-carbon ammonia are now underway, and these case studies will inform the design of an international low-carbon ammonia certification scheme. Second, there is an urgent need to establish definitions across the industry, or risk losing credibility. Third, Aramco (absolutely the most profitable company in the world, with over a hundred oil and gas fields and almost 300 trillion scf of natural gas reserves) has sent a clear signal that it intends to make and sell ammonia as a decarbonized energy commodity.
Last week, Air Products, ACWA Power, and NEOM announced a $5 billion, 4 gigawatt green ammonia plant in Saudi Arabia, to be operational by 2025. Air Products, the exclusive off-taker, intends to distribute the green ammonia globally and crack it back to “carbon-free hydrogen” at the point of use, supplying hydrogen refueling stations. According to Air Products’ presentation on the project, “our focus is fueling hydrogen fuel cell buses and trucks.” This will be one of the first projects to be built in the industrial hub of NEOM, a futuristic “model for sustainable living.” NEOM is a key element in Vision 2030, Crown Prince Mohammed bin Salman’s plan to diversify the Saudi Arabian economy and reduce dependence on oil revenues. In other words, Saudi Arabia is establishing itself as “a global leader in green hydrogen production and green fuels.”
