September 26, 2021

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- A new chapter in Norwegian industry - E24

– A new chapter in Norwegian industry – E24

On Monday, Yara, Statkraft and Aker officially launched their green ammonia project in Herøya. But if a megaproject involving deep climate cuts is to become a reality, both costs must be cut and power cables and state aid must be in place.

Amonia personalities: NHO President Ole Erik Almlid (from left), Aker President Oyvind Eriksen, Statkraft President Christian Rynning-Tønnesen, LO Leader Peggy Hessen Følsvik and Yara President Svein Tore Holsether

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Hroya Industrial Park (E24): “If anyone tops this during Arendal Week, I’d be surprised,” excited NHO President Ole Erik Almlid shouted from the podium.

“We should have had champagne to celebrate,” he continued while giggling beside him LO leader Peggy Hessen Følsvik.

On Monday, the two made the trip to Yarra’s representative residence in Heroia outside Bursgrunn – one of the country’s largest industrial districts. There, plans for the green ammonia plant were officially launched.

Yara, Statcraft and Kjell Inge Rocks Aker have founded a joint venture called Hegra, of which they own a third company.

Former Statnett CEO Auke Lont served as Hegra – Herøya Grønn Ammoniakk Chairman.

Coming up with water gas and with hydro power: Within a few years, towers, pipelines, and other infrastructure related to gas import will be unnecessary when the green ammonia plant is completed.

It can reduce huge emissions

Today, Yara uses large amounts of wet, fossil gas to make ammonia, which in turn is used to make synthetic fertilizers.

By installing an electrolyzer of about 450 megawatts, Yara estimates it will have enough hydrogen to produce about 400,000 tons of green ammonia per year – which matches the historical production level of today’s plant.

The three players in the industry plan to build the ammonia industry together – the plan is to start with the conversion of the ammonia plant located in Yarra in Herøya and then consider plants in both Glomfjord and northern Norway.

“We are writing a new chapter in Norwegian industrial history,” Yara CEO Svein Tore Holsether said as he took the stage.

With this investment, we get fossil-free and hydrogen-free fertilizers. We can therefore achieve zero-emission shipping and zero-carbon agriculture.

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Holseither noted the seriousness demonstrated in the most recent UN climate report:

– We are in a hurry towards 2030. There are only nine more years left and we have to take drastic and drastic measures in the heavy and important sectors. Chief Yara said:

Decisions must be made now to have an impact by 2030.

– This is exciting, but it is also difficult to achieve. Here we have the opportunity to remove 800,000 tons of carbon dioxide emissions annually – from one of Norway’s biggest emission points, said Auke Lont.

This roughly corresponds to the emissions of 300,000 private cars.

In 2005, the Yara plant in Hero released 2.5 million tons per year, but various actions in recent years have reduced this to just under a million. Thus, the green ammonia plant will remove almost all of the remaining emissions from the Yarra here.

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important for shipping

In December last year, Yara outlined her plans to electrify the massive ammonia plant at Herøya in Porsgrunn. In February, it became known that Aker and Statkraft had joined the Yara Project.

Today, the plant runs on fossil gas that is transported to ships before it is used to produce hydrogen. With this project, the three partners will rebuild the plant so that electricity and renewable water can be used to produce hydrogen through electrolysis.

Then you can produce green ammonia by combining hydrogen and nitrogen in industrial processes.

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Compostable stock from Yara. About 95 percent of the production is exported in Heroya, China, Brazil, and the United States are the largest markets.

During shipment, both ammonia and hydrogen are being considered as potential alternatives to reduce emissions. Batteries can do the work on hybrids and shorter trips, but they quickly get too big and heavy for long travel distances with today’s technology.

Ammonia in chilled form (-33°) has 1.5 times the energy density of liquid hydrogen (which must be cooled to -253°), so more ammonia is a better solution to lower emissions in shipping.

According to Yara, converting global freight to ammonia will result in consumption of 500-600 million liters per year, which is up to four times the current production.

Large engine manufacturers such as MAN and Wärtsilä now test ammonia directly in internal combustion engines. This could make it possible to modify the ammonia in existing vessels. In addition, fuel cells running on ammonia are being tested, Haig Auckland, CEO of industry group Maritime Cleantech, said from the platform.

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Need power cables, state aid, and lower costs

Although the ambitions are high and the project will lead to significant reductions in carbon dioxide emissions, there is no easy move toward realizing the plans.

For this project to be successful, costs must come down. We also rely on the ability to create a market for this. It would be as if unleaded gasoline was introduced. It’s something new, it costs more, but it’s also cleaner and better,” Statkraft CEO Christian Renning Tonsen said from the platform.

Auke Lont also thinks the main challenge is getting someone to pay the extra cost for green ammonia, rather than the traditional gas-based price.

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Aker CEO Øyvind Eriksen on E24 lists other pieces that must be in place for the project to become a reality: capacity in the power grid to Herøya, Enova support and contracts for difference.

– Yara cannot buy ammonia more than the market price in general. Therefore, contracts for difference are needed so that the authorities cover the potential price difference from the market price of ammonia, says Eriksen.

– This is fully in line with what the European Union proposes in its “Fit for 55” plan, he continues.

Auke Lont noted that there are advantages to ammonia as well:

There is already a global ammonia industry that transports ammonia all over the world. This means that there are many ports you already store and you know how to deal with them. Ammonia is not green today, he said, but with this infrastructure we can make it green.

None of the players on Monday wanted to say anything concrete about what the project would entail in terms of investments so far. It also the Chairman of the Board, Auke Lont, who explained to E24 that work is underway on the details of the feasibility studies now.

– We aim to have a factory running in 2026, says Lunt.

According to Aker CEO Øyvind Eriksen, it is unclear when an investment decision will be made, but this will only happen after the presentation of the state budget for 2023 in October next year.

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