CF Industries Holdings Inc. and Mitsui & Co. Ltd. on May 3 announced their intention to jointly develop a greenfield ammonia production facility in the U.S. Gulf Coast region. The new facility will produce blue ammonia by leveraging carbon capture and sequestration processes to reduce carbon emissions by more than 60 percent compared to conventional ammonia.
“Our work with Mitsui has reinforced our shared belief that blue ammonia will play a critical role in accelerating the world’s transition to clean energy and that demand for blue ammonia will grow meaningfully in the second half of this decade,” said Tony Will, CF President and CEO. “We believe that the U.S. offers considerable advantages for blue ammonia production due to access to plentiful and low-cost natural gas, the regulatory and legal framework in place, and the geology suitable for permanent carbon sequestration.”
The two companies said they have secured an exclusive right to acquire a Gulf Coast site suitable for an export-oriented production facility. CF will have 52 percent and Mitsui will have 48 percent ownership of the intended joint venture, with CF responsible for plant operations and maintenance and Mitsui leading the marketing and distribution of the blue ammonia into Asia.
The companies said they are also discussing a commercial expansion of the joint venture to leverage Mitsui’s considerable marketing and distribution capabilities into that market.
“We look forward to working with CF Industries to develop the low-carbon ammonia project in the U.S.,” said Takashi Furutani, Executive Managing Officer and Chief Operating Officer of Basic Materials Business Unit of Mitsui. “Energy solutions remain a strategic focus area for Mitsui; thus, we are excited to commence this new business opportunity with CF Industries in light of global climate action. As a responsible member of the global business community, we will continue to contribute to creating an eco-friendly and sustainable future.”
The companies anticipate that a 9-12 month front-end engineering design (FEED) study will commence shortly, with a final investment decision on constructing the facility expected in 2023. Assuming roughly four years for construction and commissioning, the new project would begin production in 2027 at the earliest.
CF also expects to produce up to 2 million tons/year of blue and green ammonia at its existing facilities beginning in 2024. This includes a $200 million investment to construct a CO2 dehydration and compression facility at its Donaldsonville Complex in Louisiana (GM Nov. 5, 2021).
CF said orders for all major equipment items have been placed and detailed engineering is well underway for the Donaldsonville project. Once the unit is in service and sequestration is initiated, the facility will be able to produce up to 1.7 million tons of blue ammonia per year, CF said, which is equivalent to 1 million tons of net-zero carbon ammonia.
“We believe that ammonia will play a critical role in accelerating the world’s transition to clean energy and that demand for blue ammonia for this purpose will grow meaningfully in the coming years,” Will said. “Our intended joint venture with Mitsui and our project to enable a significant volume of blue ammonia from Donaldsonville starting in 2024 confirms our position at the forefront of this emerging global market.”