Ammonia Beckons
The popularity of ammonia as a fuel for shipping is likely to benefit from a growing number of green ammonia production projects. Shipowner confidence in the availability of ammonia was displayed this week by Belgian oil tanker group CMB.TECH and charterers Mitsui O.S.K. Lines and MOL Chemical Tankers as they signed deals for nine ammonia-powered bulk carriers and chemical tankers.
Green hydrogen and ammonia projects around the world have advanced over the last few weeks. Last week, for example, the Australian Renewable Energy Agency announced the first recipient from its Hydrogen Headstart Program, with A$814 million in funding allocated to Copenhagen Infrastructure Partners for the 1.5GW Murchison Green Hydrogen Project in Western Australia.
The development involves large-scale production of renewable hydrogen and ammonia powered by approximately 1.2GW of solar photovoltaic power and approximately 1.7GW of onshore wind power. Green ammonia is expected to be exported globally.
Separately, the Port of Newcastle, Australia, announced last week that Mitsubishi Heavy Industries (MHI) will help it develop a new clean energy hub. MHI has experience developing the Takasago Hydrogen Park in Japan, the world’s first integrated hydrogen validation facility which began operations in September 2023. Newcastle’s Clean Energy Precinct will feature electrolytic hydrogen and ammonia production, storage, distribution and export facilities.
In Morocco, it was announced last week that five investment consortiums will commit $30 billion towards six large-scale projects – four of them for ammonia.
And this week, Brazilian solar developer Solatio advanced plans for its renewable hydrogen and ammonia project in northeast Brazil.
A group of Japanese companies, including Mitsui O.S.K. Lines, signed an MoU this week to explore investment opportunities in a green ammonia production project in India.
Green ammonia projects are dependent on sourcing enough renewable energy. The International Renewable Energy Agency (IRENA) released its Renewable Capacity Statistics 2025 report this week showing there was a massive increase in available renewable power capacity during 2024, reaching 4,448GW. The 585GW that came online last year represents a record rate of annual growth of 15.1%.
However, there are still risks. Although 2024 marked yet another benchmark in renewable energy capacity and growth, progress still falls short of the 11.2 terawatts needed to align with the global goal to triple installed renewable energy capacity by 2030. To reach this goal, renewable capacity must now expand by 16.6% annually until 2030.
That may be a challenge. This week, for example, Shell announced that it will discontinue its solar and wind energy generation projects in Brazil. The major’s global strategy also includes a reduction in spending on renewable and low-carbon businesses.