CF Industries collaborates with JERA and Mitsui on a $4 billion low-carbon ammonia plant

CF Industries has announced a joint venture with JERA, Japan’s largest power generator, and trading giant Mitsui & Co to establish one of the world’s largest low-carbon ammonia production facilities, representing an investment of approximately $4 billion. The initiative aligns with the surge in clean energy projects spurred by significant climate change legislation introduced by former U.S. President Joe Biden in 2022.

This new facility will be built at the CF Industries’ Blue Point Complex in Louisiana and includes innovative features such as an autothermal reforming (ATR) ammonia production facility coupled with a CO2 dehydration and compression unit. This arrangement is designed to facilitate the transportation and sequestration of captured CO2, with Occidental’s carbon capture firm, 1PointFive, slated to handle these processes.

CF Industries projects that the production of low-carbon ammonia will commence in 2029. The facility is expected to have a yearly production capacity of 1.4 million tons, potentially making it the world’s largest ammonia production site by nameplate capacity. Each partner will contribute to the funding according to their stake in the joint venture and will off-take ammonia based on these proportions.

JERA, which is co-owned by Tokyo Electric Power and Chubu Electric Power, plans to offtake about 490,000 tons of ammonia, primarily for its Hekinan thermal power station in central Japan. The company has outlined plans to initiate commercial co-firing of 20% ammonia with coal at two Hekinan units by 2030, which will require roughly 1 million tons of ammonia annually.

The Japanese government is also stepping in to support the transition, as JERA officials highlighted expected price supports to cover the cost differential between ammonia and traditional coal for a span of 15 years. This policy is aimed at reducing Japan’s dependence on fossil fuels and boosting its energy security, considering the non-emissive nature of hydrogen and ammonia when burned.

Mitsui, known as Japan’s largest ammonia importer, anticipates a rise in demand from Europe due to tightening emissions regulations, according to company officials.

CF Industries will hold a 40% stake in the venture, with JERA at 35% and Mitsui at 25%. This project not only underscores the increasing global transition towards low-carbon energy solutions but also highlights the strategic collaborations across borders aimed at fostering significant environmental and economic impacts.