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Alberta hydrogen project: Petronas & Itochu look at ammonia viability
Gary Park for Petroleum News
Petronas, the Malaysian state-owned global powerhouse, is making fresh moves to expand its role in Canadian-based new-generation energy projects.
The Canadian division of the company that operates in 90 countries has confirmed it is teaming up with Japan’s Itochu to explore the viability of building a US$1.3 billion petrochemical facility in central Alberta to produce low-carbon ammonia, a source of hydrogen fuel, for shipment to Asian markets.
The plan ties in with a stake Petronas acquired in Royal Dutch Shell’s LNG Canada project in British Columbia after abandoning its own LNG plans.
The hydrogen project would be capable of producing 1 million metric tons a year of hydrogen while capturing and storing the carbon emitted in the process, thus giving it the label of “blue hydrogen.”
Japan targets blue ammonia The Japanese government has set a target of securing 30 million metric tons of blue ammonia by 2050 as part of its goal to achieve net-zero carbon dioxide emissions.
Petronas Energy Canada said it is studying the costs and transportation options to determine if the project is financially viable.
Itochu belongs to a group of more than 30 industrial players that have partnered to study ammonia as an alternative marine fuel by examining issues such as safety, fuel specifications and net CO2 emissions in hopes of establishing a global ammonia supply chain and developing ships to use ammonia fuels.
The two companies said they would jointly market the ammonia, “potentially for thermal power generation in Japan, replacing hydrocarbon-based fuels for power plants, steel, chemical production and other applications.”
If the plan gets final investment approval from its own executives as well as the British Columbia and Alberta governments, construction involving 10,000 direct and indirect jobs would start in 2023, while 3,300 full-time jobs would be created when it came on-line in 2027.
Petronas’s Canadian Chief Executive Officer Mark Fitzgerald declined to name which Canadian pipeline company is participating in the feasibility study.
Canadian pipelines Both TC Energy and Enbridge have previously been involved in developing westbound natural gas pipelines for proposed LNG project on the B.C. coast, including the Prince Rupert Natural Gas Transmission line, which has full regulatory approval, and the WestCoast Connector Gas Transmission line.
But the LNG projects associated with those pipelines have been abandoned in recent years.
The Alberta government is now hopeful the transportation plans can be repurposed to carry hydrogen to a B.C. coast tanker terminal.
But neither Alberta nor Petronas would say whether the corporate partnership has any intention of applying for a government grant.
Dale Nally, Alberta’s associate minister of natural gas and electricity, told the Globe and Mail that the Petronas/Itochu initiative “is an incredible opportunity for Alberta’s natural resources to reach new markets and further display the innovation that powers out dynamic energy sector.”
Garrett Matteotti, director of fuels, chemicals and carbon capture at Invest Alberta, a government agency designed to attract international investment, said the government started discussions in 2015 with Itochu at the same time Alberta launched efforts to entice petrochemical projects.
He said that when companies look at Alberta “they see a network of support across municipal and provincial governments and economic development groups that you see in very few places in the world.”
By capturing and storing carbon dioxide before it enters the atmosphere, the plant would produce what is known as “blue ammonia.” That is different from “green ammonia,” which is the result of hydrogen that comes from water electrolysis powered by renewable energy and produces less greenhouse gas emissions from the production process.
- GARY PARK
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