Fertilizer Companies Race to US Gulf to Make Low-Emissions Ammonia

Fertilizer companies are leading the race to build plants along the U.S. Gulf of Mexico to produce ammonia, a compound mainly used for fertilizer, while capturing most of the carbon dioxide emissions. The low-emissions ammonia is known as blue ammonia. The companies have focused on the U.S. Gulf Coast to take advantage of Inflation Reduction Act subsidies and the existing export infrastructure.

OCI (OCI.AS)

The Dutch fertilizer producer has the early lead, with construction underway of its 1.1 million metric ton per year plant at Beaumont, Texas.

Status: It is scheduled to open in 2025.

CF Industries (CF.N)

The world's largest ammonia producer has committed $285 million to enable existing plants in Louisiana and Mississippi to process carbon before transporting it for sequestration.

It, along with its partner Mitsui (8031.T), is considering construction of a new blue ammonia plant in Louisiana.

Status: Final investment decision on the new plant expected in 2023. Production would start in 2027.

Yara (YAR.OL)

The Norwegian fertilizer maker aims to invest up to $2.9 billion in a blue ammonia plant in Ingleside, Texas together with Canada's Enbridge (ENB.TO).

The facility would capture about 95% of the carbon emissions in what would become Yara's biggest production site with a production capacity of 1.2-1.4 metric tons per year and full offtake for Yara.

Status: Final investment decision pending, production would start around 2027-28.

Yara is also looking into developing and building a second site of similar capacity with Germany's BASF (BASFn.DE).

Status: Feasibility study on the BASF site expected by end-2023. The company has earlier said production would start for its second North American blue ammonia project in 2028-2029.

Nutrien (NTR.TO)

The Canadian producer is evaluating a site at Geismar, Louisiana, where it already has a facility, to produce 1.2 million metric tons of blue ammonia. It would partner with Denbury (DEN.N) for carbon sequestration.

Mitsubishi (8058.T) has signed a non-binding agreement to buy up to 40% of the plant's production.

Status: Final investment decision expected in 2023. Production would start by 2027.

Other companies planning low-emissions ammonia projects in the U.S. Gulf: LOTTE Chemical/Mitsubishi/RWE; ExxonMobil (XOM.N); Ascension Clean Energy; Air Products and Chemicals (APD.N); and St. Charles Clean Fuels.

(Reporting by Rod Nickel and Victoria Klesty; Editing by Anna Driver)