CF Industries Holdings, Inc. today announced that it has signed a memorandum of understanding (MOU) with JERA Co., Inc. (JERA), Japan’s largest energy generator, regarding the supply of up to 500,000 metric tonnes per year of clean ammonia beginning in 2027.
The execution of the MOU is the result of a supplier comparison and evaluation process for the procurement of clean ammonia that JERA initiated in February 2022 for the world’s first commercial scale ammonia co-firing operations.
The clean ammonia, which will be required to be produced with at least 60% lower carbon emissions than conventionally produced ammonia, will be co-fired with coal at JERA’s Hekinan Thermal Power Station in order to reduce carbon dioxide (CO2) emissions from the facility. Ammonia does not emit CO2 when combusted. JERA has successfully concluded an ammonia co-firing pilot test and will begin a demonstration project during its fiscal year 2023 at its Hekinan power plant.
The MOU establishes a framework for the companies to assess how CF Industries would best supply JERA with clean ammonia under a long-term offtake agreement. The companies expect to evaluate a range of potential supply options, including an equity investment alongside CF Industries to develop a greenfield clean ammonia facility in Louisiana and a supplementary long-term offtake agreement from CF Industries’ Donaldsonville Complex in Louisiana
“We are pleased to continue to build our relationship with JERA as we advance our shared commitment to accelerate the world’s transition to clean energy,” said Tony Will, president and chief executive officer, CF Industries Holdings, Inc. “Our leading ammonia production network and disciplined investments in clean energy initiatives have positioned CF Industries at the forefront of clean ammonia supply. We look forward to helping JERA and Japan meet its clean ammonia requirements, which represent the first significant volume of what we believe will be substantial global demand for clean ammonia as a clean energy source.”
JERA Corporate Vice President Yukio Kani said, “We are pleased to work together with CF Industries on this significant journey towards decarbonizing the industry, and I am confident that CF Industries’ reliable operational capabilities that formed its track record for safe and efficient production as the world’s largest ammonia producer will profoundly contribute to JERA’s structuring of the clean fuel ammonia value chain. JERA will continue its own efforts as well as to take hands with our partners in pursuit of our endeavor to realize and accelerate not only the decarbonization of the Japanese energy industry but also to solve the energy-related issues that the world is facing.”