Commodities trading and logistics giant Trafigura Group, Singapore, is on track to make a final investment decision (FID) this year on the A$750 million ($539 million) hydrogen and ammonia project in Port Pirie in Australia, Tim Rogers, Trafigura General Manager Australia, told Bloomberg on June 1.
The project would be a joint investment with Nyrstar NV and the South Australia government. Trafigura has also signed on to a joint venture for a 600 mt/d green ammonia plant in Norway (GM Feb. 4, p. 30).
The Port Pirie project would eventually produce 100 mt/d of green hydrogen and utilize a 440-megawatt electrolyser. The product would be used both domestically and turned into ammonia for export.
The facility would be integrated with Trafigura’s Nyrstar metals recovery smelter at the site, utilizing existing infrastructure and gaining a brownfield advantage over a greenfield project. A FID is expected by the end of 2022, and if approved, construction would begin in 2023. The parties initiated an A$5 million Front End Engineering Design (FEED) study in December.
Australia looks to its abundant potential to produce electricity using solar and wind to become a major exporter in the nascent green hydrogen market, with projects in the country accounting for more than 40% of those planned globally, according to BloombergNEF. Many of these plants will be big, leading to a “lumpy” transition that will allow Trafigura to benefit from its trading experience, Rogers said.
“There’s going to be a difference in profile between production coming online and the demand for that production,” he said. “There’ll be price movements within that market. And that’s obviously what an organization like ourselves does – help solve those shorter-term anomalies in supply and demand.”
The company currently has ammonia traders in its three main hubs in Geneva, Singapore, and Houston, mainly buying and selling gray ammonia, Rogers said. “Those fertilizer markets, those feedstock into explosive markets, they will likely also over time move toward being green,” Rogers said.
Trafigura has also signed a Memorandum of Understanding (MOU), with Yara International ASA, Oslo, to collaborate on the development and promotion of ammonia as a clean fuel in shipping and to explore possible opportunities to work together on certain clean (green and blue) ammonia fuel infrastructure and market opportunities (GM June 11, 2021).