Mitsubishi buys stake and offtakes ammonia in Texas from ExxonMobil

The Japanese trading house Mitsubishi announced on Friday that it had reached an agreement in principle to purchase a stake and take delivery of low-carbon ammonia produced by ExxonMobil at its hydrogen plant in Texas.

As part of its decarbonisation campaign, Japan aims to increase the use of ammonia and hydrogen in power plants and for other uses, such as steel and automobiles.

Mitsubishi stated that ExxonMobil was expecting to produce up 1 billion cubic feet per day (bcf), which would be about 98% CO2 removed. And more than 1,000,000 tons of low carbon ammonia each year.

Mitsubishi did not disclose the size of its stake or the amount of ammonia it would be willing to purchase.

Mitsubishi plans to partner with Japanese oil refining company Idemitsu Kosan to jointly invest and offtake ammonia, which is expected to be used for power generation in Japan, process heating, and other industrial activities.

Idemitsu Kosan and Mitsubishi Corp, along with Swiss firm Proman, agreed earlier this year to study the feasibility of a fuel ammonia project in Louisiana.

Idemitsu plans to build an ammonia terminal at its Tokuyama plant, located in western Japan. It will supply over 1 million tons (of low-carbon) ammonia to industrial customers by 2030. This includes buyers in the chemical and steel industries.

Mitsubishi is also considering converting a portion of its Namikata liquefied gas terminal (LPG terminal) in western Japan to an ammonia facility and supplying low-carbon ammonia used in various industrial applications.

Masaru Saito is the chief executive of Mitsubishi's environmental energy group. He said, "We are thrilled to be working closely with ExxonMobil on developing low-carbon ammonia and hydrogen supply chains which will connect the United States with Japan."

(source: Reuters)