The trio has signed a letter of intent aimed at electrifying Yara's existing ammonia facility in Porsgrunn, hence making it a production base of zero-emission fuel for shipping, carbon-free fertilizer, and ammonia for industrial applications.
Provided that power is available at the site and the required public co-funding is in place, the project could be realized within five-to-seven years.
Making the Porsgrunn facility entirely green equals to getting rid of more than 300k fossil fuel passenger cars.
According to the parties, converting long-distance shipping to ammonia would require some 500-600mt of ammonia produced annually, i.e., three-four times more than what is the current global output.
“This is not just a unique decarbonisation project, but a strategic investment that can establish new value chains for green hydrogen and green ammonia. [...] With Statkraft and Aker Horizons onboard we gain key expertise within renewable electricity, power markets, industrial development and project execution, giving us a unique opportunity to realize the project," Svein Tore Holsether, President and CEO, Yara, commented.
He furthered, "It is currently more expensive to produce green hydrogen based on renewable electricity and electrolysis than through natural gas, but large-scale production will reduce the cost of the electrolysis route. For hydrogen to be exported or used in long-haul shipping or fertilizer production, it needs to be converted to ammonia, and converting Yara's existing ammonia plant is both faster and more cost-effective than building a new plant. However, realizing this innovative project will require good incentive frameworks and support from the authorities."
"The first project in Porsgrunn can be a lighthouse project - providing competitive advantage in a growing global hydrogen economy and building on existing capabilities in the Norwegian supplier industry to create new jobs for the future," Øyvind Eriksen, President & CEO, Aker ASA, and Chairman, Aker Horizons, added.
Christian Rynning-Tønnesen, CEO, Statkraft, summed by saying, "Norway's rich renewable energy resources are one of our most important competitive advantages. This project paves the way for new industrial development and can at the same time give Norway's important maritime sector a new competitive advantage, namely access to an efficient and emission-free energy source on a large scale."
In addition to the Porsgrunn project, the companies plan to explore the potential for green ammonia production in Northern Norway as a future opportunity.