Incitec Pivot Ltd., Southbank, Victoria, expects to make a Final Investment Decision (FID) on its Gibson Island Green Ammonia Project in Brisbane, Queensland, by the end of the year, according to the company’s recently released Climate Change Report 2023.
The company, along with partner, Fortescue Future Industries (FFI), would construct a green hydrogen/ammonia complex at the site of IPL’s existing, but idled, nitrogen complex.
“Having completed Front End Engineering Design (FEED) stage this year, we are now working toward an FID,” said IPL Interim CEO Paul Victor. “If approved, as far as we are aware this will be the first world-scale conversion of an existing ammonia manufacturing facility to renewable ammonia production.”
The project received A$13.7 million from the Australian Renewable Energy Agency (ARENDA) to assist in the funding for the initial design. IPL expects additional government support will be required for the project to proceed.
Started in 1969, IPL idled Gibson Island last year due to its inability to economically source natural gas (GM Nov. 12, 2021). FFI’s proposed water electrolysis facility will produce up to 70,000 mt/y of renewable hydrogen, replacing Gibson Island’s need for natural gas.
The retrofitted plant ultimately could produce up to 400,000 mt/y of green ammonia, which could be exported to international markets, as well as used to produce fertilizers, or potentially used as a low-carbon fuel source for ports, airports, and heavy transport, IPL said. The existing ammonia plant has nameplate capacity of 300,000 mt/y, according to the company’s website.
The Gibson Island facility was Australia’s only urea production facility and had approximately 340,000 mt/y of capacity (GM Nov. 12, 2021). The upgraded complex will not produce the product. IPL will instead source urea from the new Perdaman Chemicals and Fertilisers Pty Ltd. urea plant (GM May 7, 2021) under a long-term contract.
While IPL said that green hydrogen is not expected to be price-competitive with natural gas for ammonia made for traditional uses until around 2040, it said ammonia made from green hydrogen has the potential to contribute significantly to the decarbonization of energy systems and heavy vehicle transport.
In total, IPL said its Incitec Pivot Fertilisers unit has invested some A$50 million in sustainability capital in decarbonization projects.
In the meantime, in its Dyno Nobel explosives business, IPL signed a Memorandum of Understanding (MOU) with Keppel Infrastructure Holdings Ltd. and Temasek in 2021 to investigate the feasibility of producing green ammonia at an industrial scale in Queensland and New South Wales for export to meet the rapidly growing market in Asia (GM Nov. 12, 2021).
Since that time, Keppel invested in the CQ-H2 Central Queensland Renewable Hydrogen Project at Gladstone. Based on the potential offtake of hydrogen from this project, IPL in May 2023 signed a second MOU with Keppel to explore building a world-scale green ammonia production and export facility, and also expanded its combined interests to the US and other geographies. Should it proceed, the Gladstone facility would be capable of producing up to 850,000 mt/y of green ammonia for both domestic and overseas consumption.
In the medium-to-long term, green ammonia could be an option for IPL Dyno Nobel’s small facility in Cheyenne, Wyo. IPL said that the plant represents almost all of the explosive units with less than 5% exposure to the declining thermal coal market, noting that it currently supplies ammonium nitrate explosives to the Powder River Basin.
In the near term, the coal exposure is being managed through further expansion into quarry, construction, and metals markets. However, as a secondary strategy, the Cheyenne facility is set to expand into the manufacture of diesel exhaust fluid (DEF), which is urea-based. IPL said this will further reduce the coal exposure by creating another income stream in the short term.
For the longer term, IPL is looking at converting Cheyenne from natural gas to green hydrogen for ammonia and reacting this with CO2 purchased by pipeline. As a result, IPL said the facility could be repurposed to produce ammonia-based fertilizers should the region transition away from thermal coal to farming, as is being progressed by the Reclaiming Appalachia Coalition, which is supported by the US Just Transition Fund. Both entities support local communities whose economies have been impacted by the decline of coal.