Chemical firms partner for blue ammonia production in US Gulf Coast

Germany chemicals company Linde will build a blue hydrogen plant next to OCI's upcoming 1.1 million mt/year blue ammonia plant in Beaumont, Texas.

PHOTO: Model of OCI's blue ammonia plant under construction. OCI

Under a long-term agreement, Linde will supply blue hydrogen and nitrogen feedstocks to OCI’s ammonia production facility. The blue hydrogen will be produced using autothermal reforming (ATR) with carbon capture systems (CCS).

ATR is a process for producing syngas composed of hydrogen, carbon monoxide and carbon dioxide. CCS is then used to capture carbon dioxide from the blue hydrogen production, thereby reducing its greenhouse gas emissions. The carbon dioxide captured during the process can be stored or further utilised.

OCI's blue ammonia plant is expected to be up and running by the first quarter of 2025. Beaumont has been highlighted as a strategic location to supply both the US domestic market with ammonia, to export it as cargo to Europe and Asia, and to target demand from shipping and power generation in particular.

OCI has previously said that new US tax credits have made the investment decision more attractive. When President Joe Biden's administration pushed through the Inflation Reduction Act in August last year, it came with enhanced tax credits for carbon capture under Section 45Q.

Carbon capture projects under construction before 2033 - like Linde and OCI's plants - there will be a $85/mt tax credit (up from $50/mt) for carbon dioxide captured by industrial plants and power plants and then stored in geological formations. If the captured carbon dioxide is instead utilised beneficially, the tax credit is $60/mt (up from $35/mt).

By Nithin Chandran

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