Marubeni Corp. (Marubeni) and ExxonMobil Corp. (ExxonMobil) signed a long-term offtake agreement for approximately 275,578 tons (250,000 tonnes) of low-carbon ammonia per year from ExxonMobil’s facility in Baytown, Texas, which is expected to produce virtually carbon-free hydrogen with approximately 98% of carbon dioxide (CO2) removed and low-carbon ammonia. Marubeni will supply the ammonia mainly to Kobe Power Plant, a fully owned subsidiary of Kobe Steel Ltd. (Kobe Steel). Marubeni has also agreed to acquire an equity stake in ExxonMobil’s low-carbon hydrogen and ammonia facility.
ExxonMobil’s facility is expected to be the world’s largest of its kind upon startup, capable of producing up to 1 bcf/d (28.3 x 106 m3/d) of low-carbon hydrogen, which is virtually carbon-free, and more than 1 million tons (907,185 tonnes) of low-carbon ammonia per year. Contingent on ongoing supportive government policy and necessary regulatory permits, a final investment decision is expected in 2025.
“This is another positive step forward for our landmark project,” said Barry Engle, president of ExxonMobil Low Carbon Solutions. “By using American-produced natural gas we can boost global energy supply, support Japan’s decarbonization goals and create jobs at home. Our strong relationship with Marubeni sets the stage for delivering low-carbon ammonia from the US to Japan for years to come.”
“Marubeni will take this first step together with ExxonMobil in the aim of establishing a global low-carbon ammonia supply chain for Japan through the supply of low-carbon ammonia to the Kobe Power Plant,” said Yoshiaki Yokota, senior managing executive officer, member of corporate management committee, supervisor of Energy & Chemicals Division and Power & Infrastructure Services Division at Marubeni Corporation. “Additionally, we aim to collaborate beyond this supply chain and strive towards the launch of a global market for low-carbon ammonia. We hope to continue to actively cooperate with ExxonMobil, with a view of utilizing this experience and relationship we have built to strategically decarbonize our power projects in Japan and Southeast Asia in the near future.”
By Japan’s fiscal year 2030, the Kobe Power Plant aims to co-fire low-carbon ammonia with existing fuel, reducing CO2 emissions. Through this supply chain, Marubeni aims to assist the decarbonization of not only Japan’s power sector but also its hard-to-abate sectors, such as the steel manufacturing industry, chemical industry, transportation industry, and others.
