Two low carbon nitrogen projects – Prairie Horizon Energy Solutions LLC and NextEra Energy Resources Development LLC – are in the running for a $125 million forgivable loan in North Dakota, which is believed to be the largest forgivable loan in state history.
The legislature approved the loan last fall, with the stipulation that the project create fertilizer from hydrogen produced by electrolysis of water.
The North Dakota Industrial Commission, which consists of Governor Doug Burgum, Attorney General Drew Wrigley, and Agriculture Commissioner Doug Goehring, will have the final nod on who receives the loan, with the N.D. Clean Sustainable Energy Authority (CSEA) providing a recommendation.
The CSEA Technical Review Committee met on Jan. 16, reviewed the projects, and gave them initial ratings. CSEA will meet again on Jan. 23 for a more detailed presentation by the companies and a question-and-answer session.
Prairie Horizon’s $2.2 billion project would be in Dickenson and produce 419,750 tons of ammonia. Some 73,000 tons of ammonia production would come via electrolysis and be green. The project would also use natural gas, with that ammonia being blue. Capturing and storing carbon dioxide is also part of the plans. Committee members noted that the project is in a part of the state that would geologically have carbon storage.
The CSEA Tech Committee gave the project a rating of 41.75 out of 50, saying that the project is “feasible,” with conditions to be determined. The project’s carbon capture is put at 650,000 tons per year. The average rating from independent technical reviewers was 210.75, which put it into the “fair” category.
Prairie Horizon is also seeking a $65 million loan from the N.D. Development Fund, but a decision there will not be made until after a CSEA decision.
Much of the reason for the new project is to source nitrogen from in-state rather than imports. As a result, urea may also be produced from the ammonia producers. How much urea is expected from each project is open to question, with CSEA Tech Committee members speculating that the Prairie Horizon project could potentially meet 50% of North Dakota’s urea needs.
Prairie Horizon Hydrogen is a collaboration between Marathon Petroleum Corp. (MPC) and TC Energy. Both of those companies are a part of the Heartland Hydrogen Hub (HH2H), which was selected by the US Department of Energy for up to $925 million to produce low carbon hydrogen, decarbonize regional supply chains, and create clean energy jobs across Minnesota, Montana, North Dakota, South Dakota, and Wisconsin (GM Oct. 13, 2023).
Other HH2H participants include the University of North Dakota’s Energy & Environmental Research Center (EERC), and Xcel Energy. MPC and TC are also engaged with the Mandan, Hidatsa, and Anikara Nation and Sumitomo Corp. of Americas in the initiative.
NextEra’s $1.293 million facility would be in Spiritwood Energy Park near Jamestown, producing 100,000 tons per year of green ammonia. The CSEA Tech Committee gave it a rating of 39.13 and “feasible,” with conditions to be determined. Independent reviewers gave it a 178.5 rating, which put it into the “questionable” category.
NextEra is already heavily involved in the state, having invested $3.7 billion in North Dakota wind generation projects with another in the planning stages. NextEra has been eyeing a possible fertilizer plant in the state for some time (GM June 2, 2023) and has lobbied the state legislature for enactment of the $125 million loan.
Some legislators were concerned that the hydrogen requirement would favor NextEra, but Rep. Glenn Bosch (R-Bismarck) said he added an amendment to require the CSEA to do a technical review to vet any competing projects, according to the Grand Forks Herald.
This is not NextEra’s first foray into the fertilizer industry. It has signed a Memorandum of Understanding (MOU) with CF Industries Holdings Inc. for a joint venture to develop a zero-carbon-intensity hydrogen project at CF’s Verdigris Complex in Oklahoma (GM April 28, 2023).
NextEra has also invested in clean technology developer and junior ammonia producer Monolith, Lincoln, Neb., which has plans to produce 275,000 mt/y of ammonia in Nebraska (GM July 15, 2022). Monolith said it can cleanly produce essential materials such as ammonia using a proprietary methane pyrolysis.
According to its website, NextEra is one of the largest wholesale generators of electric power in the US, with approximately 27,400 megawatts of total net generating capacity, primarily in 40 states and Canada. It said it is the world’s largest generator of renewable energy from the wind and sun, a world leader in battery storage, and is driving the development of the green hydrogen economy.
CSEA is also reviewing funding for a third ammonia project in North Dakota that is only seeking $10 million. The water electrolysis component is not a factor in this award. Catalyst Midstream (USA) LLC’s Berthold project would cost $960 million and produce 1.08 million tons per year of blue ammonia.
The CSEA Tech Committee gave it a rating of 38.88 and said the project is “feasible,” with conditions. Independent reviewers scored it at 266, which put it in the category of “good.” According to the Committee, independent reviewers also questioned Catalyst’s private funding for upfront studies, ready access to Asian export markets, and terminal storage.
Based on Committee questioning, the ammonia from the Catalyst project appears to be destined for Japan, a factor that would not benefit state farmers. While the BNSF rail line is near Catalyst’s proposed site, one member said the rail line is normally not receptive to transporting ammonia, and he wanted to know Catalyst’s plans to transport the ammonia.
The Catalyst facility would capture 2.5 million tons per year of CO2, with one Committee member questioning its ability to store the product in that part of the state. Another questioned the company’s wherewithal to fund a project that costs more than $900 million.