Novatek, Moscow, Russia’s largest independent natural gas producer, and Uniper SE, Düsseldorf, an energy supply company, announced on Dec. 22 the signing of a term sheet on long-term supply of up to 1.2 million mt/y of low-carbon ammonia to the German and Northwest Europe markets. The product price will be indexed to relevant European and global benchmarks.
The product will be produced at Novatek’s planned Obskiy Gas Chemical Complex project, which will include carbon capture and storage facilities, and delivered to Uniper’s planned ammonia import terminal in Wilhelmshaven, Germany (GM April 16, 2021), equipped with an ammonia cracker operating with renewable power.
The imported low-carbon ammonia will be used as hydrogen carrier, transformed into gaseous hydrogen and fed into the future German hydrogen pipeline system, as well as supplied directly as a clean feedstock and as a fuel. The signing of the term sheet progresses cooperation based on a Memorandum of Understanding signed in January 2021.
“We are now at the pre-FEED stage for a low-carbon ammonia and hydrogen plant with CCS facilities, and signing of term sheets for long-term supply demonstrates growing demand for low-carbon products, which is an essential precursor for the Final Investment Decision on this project,” said Leonid Mikhelson, Novatek Chairman. “The plant will be located next to our LNG cluster in Yamal in order to minimize the infrastructure costs and provide the most competitive clean energy supplies to the global market.”