Jera, Yara explore creating clean ammonia partnership

  • Spanish Market: Fertilizers, Natural gas
  • 11/05/21

Japanese thermal power joint venture Jera and Norway-based fertilizer producer Yara International are planning to work together to study the possibility of producing and shipping blue and green ammonia.

Jera and Yara have signed an initial agreement to start considering co-operation on upgrading Yara's Pilbara fertilizer plant in Australia to produce blue ammonia, which would be supplied to Jera's power generation plants. The partnership would also cover development of new blue and green ammonia production projects, as well as exploration of new demand for the clean fuels in Japan. Blue ammonia is typically produced using natural gas but with carbon emissions being captured and stored or reused, while green ammonia is manufactured using hydrogen and renewable energy with no carbon emissions.

Demand for clean ammonia is expected to increase further in Japan, as the country is stepping up its efforts to achieve its net-zero emissions target by 2050. Tokyo targets 3mn t/yr of ammonia demand in 2030, mostly for power generation, before rising further to 30mn t/yr by 2050.

Jera is planning to operate an ammonia-dedicated power plant during the 2040s after realising a commercial use of the fuel by 2030. The firm's 1,000MW Hekinan No.4 and No.5 power generation units are currently having trials, co-firing coal, biomass and ammonia to generate electricity.

The deal with Yara follows Jera's agreement with Malaysian state-owned oil firm Petronas in February this year to co-operate on the development of a green ammonia and hydrogen supply chain. The companies plan to produce green ammonia and hydrogen from renewable energy sources such as hydropower.


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23/05/24

USDA to invest $83mn in fertilizer projects

USDA to invest $83mn in fertilizer projects

Houston, 23 May (Argus) — The US Department of Agriculture (USDA) plans to invest $83mn to build out fertilizer production plants, modernize equipment and adopt new technologies in 12 states. The grants are part of the USDA's Fertilizer Production Expansion Program (FPEP) aimed at boosting domestic fertilizer production, increasing competition and lowering costs for farmers. Around $25mn will be granted to a food waste upcycling facility in Jurupa Valley, California, to produce organic fertilizer. Nearly 90 market participants in the area will be supplied by the 11,400 tons of fertilizer produced annually at this facility. Cog Marketers, in partnership with AgroLiquid, is expected to produce 2mn USG of fertilizer a year at its Lake City facility in Florida with a $4mn grant from the USDA. Around 200 fertilizer retailers in the Mid-South region would receive product from this facility. Return will receive $4mn to expand production at its Northwood facility in Iowa. Other grants were awarded to projects in California, Florida, Hawaii, Iowa, Illinois, Kansas, Kentucky, Minnesota, North Carolina, North Dakota, Oregon and Washington. So far, FPEP has supplied 29 states with $251mn for increased domestic fertilizer production, with the last round of awards announced in March and January . About $649mn are left from the $900mn the administration of President Joe Biden committed to domestic fertilizer funding through FPEP in 2022. The FPEF was started in response to rising fertilizer prices caused by a variety of factors including the war in Ukraine. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

India’s AMNS signs 10-year LNG supply deal with Shell


23/05/24
23/05/24

India’s AMNS signs 10-year LNG supply deal with Shell

Mumbai, 23 May (Argus) — Indian steel manufacturer ArcelorMittal Nippon Steel (AMNS) has signed a 10-year deal to buy LNG from Shell, with deliveries to start from 2027, people with direct knowledge of the matter have said. Under the terms of the deal, the steelmaker's direct reduced iron (DRI) plant in the western Gujarat state of Hazira will receive 500,000 t/yr of LNG, Argus understands. The Hazira plant has crude steel production capacity of 8.8mn t/yr, according to ArcelorMittal's 2023 annual report. As much as 65pc of the capacity is based on DRI. AMNS also has a deal with TotalEnergies for 500,000 t/yr that is scheduled to expire in 2026 . This deal comes at a time when AMNS plans to expand its steel capacity to 20mn t/yr in the long run . This supply pact also underscores a trend in the global steel industry to use cleaner energy sources to produce the so-called 'green steel'. The firm imports up to 75pc of its 1.72mn t in natural gas requirements on an annualised basis, a source said. The deal was signed at a 11.5pc percentage of Brent crude prices, trading firms said, adding that this is so far the lowest-heard slope for an Indian term LNG supply contract. AMNS sought LNG supply for a period of 5-10 years starting in 2027 under a tender that closed in mid-March. The firm last sought long-term LNG in 2022 through a tender for 400,000 t/yr of LNG to be delivered across 2025-30. Indian importers will continue to seek term supply despite softening spot prices, mostly to hedge their risks in a market that can still be volatile, trading companies said. The Argus front-month price for LNG deliveries to India was assessed at $11.50/mn Btu today, up from $10.16/mn Btu a week earlier. The price reached as high as $48.30/mn Btu in August 2022. The firm has lowered its carbon emissions by 32pc in calendar year 2022 from 2015 levels, it said. By Rituparna Ghosh Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Shell to step up gas exploration in Oman


23/05/24
23/05/24

Shell to step up gas exploration in Oman

Dubai, 23 May (Argus) — Shell Oman is actively looking to explore more wells in the sultanate's onshore blocks after production reached a "little above" the plateau target of 500mn ft³/d (5.2bn m³/yr) in its core block 10 this month, according to the oil company's country chairman, Walid Hadi. Hadi told Argus that the company has embarked on an "aggressive exploration" campaign to unlock the potential in Oman's core onshore blocks 10 and 11 in which Shell has operating stakes. The blocks are part of the gas-rich Greater Barik area in the northern segment of state-controlled PDO's block 6 concession in the central region of Oman. "Oman is a niche gas sector," Hadi said. "It may not be the biggest LNG exporter in the world, but there is quite a sophisticated and high-quality gas system in place." Shell, which is also the majority private shareholder in state-owned Oman LNG, expects to boost gas production for domestic purposes and eventually for exports, according to Hadi. "We will require new gas if we are going into LNG," he said. "We know there is more potential in the blocks, but we still don't know at what scale it can produce as the two blocks are a combination of undiscovered and discovered resources." TotalEnergies said earlier this year that Oman LNG was eyeing a fourth train at its 11.4mn t/yr Qalhat LNG export terminal, having already added 1mn t/yr in liquefaction capacity through plant debottlenecking. Hadi said that Shell is planning on a "material increase" in gas production and would be able to conclude the growth potential of the blocks by mid or late 2025, when it completes the exploration programme. Gas from block 10 is sold to the government through the Integrated Gas Company, which is the entity that allocates the gas across different sectors based on certain policies and value criteria, according to Hadi. Shell has a 53.45pc stake in the block, with Marsa LNG and OQ holding 33.19pc and 13.36pc, respectively. The partners signed the concession agreement for block 10 in December 2021. The adjacent block 11 was awarded to OQ and TotalEnergies in 2021. When it comes to block 11, the company did make a material gas discovery, which is being appraised this year, but it is too early to talk about the production potential, Hadi said. "We also see quite a bit of potential in block 11 already." "Exploration is a very tricky business," he added. "You have to go after a lot of things and only few will end up working. We are at a very aggressive exploration campaign at the moment. We also expect by the end of 2025, we would be in a much better position to determine the next wave of growth and where it's going to come from." By Rithika Krishna Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

China’s natural gas consumption to peak in 2040: CNOOC


23/05/24
23/05/24

China’s natural gas consumption to peak in 2040: CNOOC

Singapore, 23 May (Argus) — China's state-controlled CNOOC expects domestic natural gas consumption to peak at 700bn m³ in 2040, said CNOOC's senior economist Xie Xuguang at a liquefied fuel shipping conference in Chongqing over 22-24 May. The conference was jointly organised by the China Shipowners' Association and Langfang International Pipeline Exhibition. CNOOC also estimated China's gas consumption to hit 410bn m³ in 2024. These most recent projections are aligned with earlier estimates from fellow state-controlled CNPC 's economic and technology research institute in Beijing, which forecast Chinese gas demand will rise by 24bn m³ in 2024 in its annual report published on 28 February. International Gas Union's president Li Yalan expects natural gas consumption in China to hit 500bn m³ in 2030 and eventually 650bn m³ in 2040. And all above growth scenarios could in fact be further enhanced should gas prices remain at "reasonable" levels, she added. She did not expand on the definition of "reasonable", but recent buying interest from mostly second-tier buyers in China hinted that the ideal target price considered acceptable for buyers in the country could be no higher than $9-9.50/mn Btu. Current spot prices are still considered way out of reach for Chinese importers. The front half-month of the ANEA — the Argus assessment for spot LNG deliveries to northeast Asia — was last assessed at $11.525/mn Btu on 23 May, $1/mn Btu higher from a week earlier. Factors such as higher-than-average temperatures in northeast Asia, southeast Asia, south Europe and the US, and some remaining concerns over production outages in the Atlantic and Pacific basins have resulted in European gas hub prices strengthening and Asian spot prices also jumping higher as a result. This is despite higher-than-average inventories in traditional major importing countries such as Japan and South Korea, and expectations of higher nuclear availability in Japan and South Korea to weigh on gas-fired generation in the summer . But traders have also pointed out that such higher prices may compel buyers in Asia to withdraw from the spot market, freezing out additional demand and eventually weighing on prices again. China has continued to step up its LNG imports even as domestic gas production extended gains in April . The country imported more LNG in April as compared to in 2023, and imports even hit a record high in March . Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Alabama Demopolis lock reopens early


22/05/24
22/05/24

Alabama Demopolis lock reopens early

Houston, 22 May (Argus) — The failed Demopolis Lock, at the intersection of the Tombigbee Waterway and Black Warrior rivers in Alabama, has reopened two weeks earlier than projected. The lock reopened on 16 May, ahead of the scheduled 30 May opening . Vessels carrying commodities such as asphalt, coal, petcoke, metals and fertilizers have been able to pass through the lock without a long queue since the reopening, according to the US Army Corps of Engineers. The lock had been closed since 16 January when the concrete sill underneath the lock doors failed. The lock was largely rebuilt over the ensuing four months Traffic that would typically pass through the lock was rerouted during the closure. Multiple steel mills in Alabama and Mississippi move some of their feedstock and finished product through the Demopolis lock. Those mills have 8.16mn short tons (st)/yr of flat, long, semifinished and pipe steel production capacity. By Meghan Yoyotte Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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