Ascension Parish [US]: CF Industries, a leading global manufacturer and marketer of agricultural fertilizers, has entered into an agreement with LOTTE Chemical Corp. to possibly join forces in the $2 billion development project taking place in Ascension Parish.
The memorandum of understanding signed between the two companies will determine whether they will build a facility to create “blue” Ammonia, which would be shipped to South Korea for use by LOTTE Chemical at its headquarters. This venture marks an exciting expansion for both brands that could lead to more collaboration and growth in the future.
CF Industries have recently struck a deal with Mitsui & Co. of Japan to develop the $2 billion "Blue Point" facility. Federal filings show that they purchased land for the project on the west bank of the Mississippi River in Ascension Parish in the third quarter of 2022.
The company has launched a front-end engineering and design, or FEED, study for this endeavour and is anticipating reaching a final investment decision by the second half of 2023, thus having approximately four years for its completion. These decisions are documented in filings with the Securities and Exchange Commission.
CF Industries and LOTTE Chemical recently announced a partnership to develop Ammonia at the Blue Point complex in the United States. The two companies highlighted several advantages of building the facility in the US, such as access to low-cost natural gas, suitable geology for carbon sequestration, and an easy regulatory and legal framework for project approvals.
LOTTE Chemical announced today that it plans to make substantial investments in clean Hydrogen production, with an estimated $4.5 billion directed towards the initiative by 2030.
“In order to bolster the domestic Hydrogen economy, it is important to secure a stable supply of clean Hydrogen and Ammonia, especially in overseas regions with abundant energy and low geopolitical risks,” Jin-koo Hwang, head of Hydrogen energy business at LOTTE, stated. “Through strategic collaboration with CF Industries, which has a long history and business experience, we will secure a production base in the USA and lead the global distribution channel.”
The new Ammonia facility is expected to use carbon capture technology to reduce its impact on the environment. By doing so, it will be producing what’s known as “blue chemicals”—chemicals created using carbon capture—instead of “green chemicals” made using renewable energy sources like solar and wind power. This forward-thinking choice will help make our world a cleaner, more sustainable place.
Industrial advocates and Gov. John Bel Edwards have both highlighted the potential of Carbon capture to reduce emissions and stimulate economic growth. However, environmental organizations have raised doubts about its effectiveness while area residents are worried that it may not be safe to use.
The Donaldsonville complex is a behemoth in the fertilizer industry, producing the world's largest amounts of Ammonia. Unfortunately, it also happens to be Louisiana's largest emitter of greenhouse gas, with an impressive 10 million tons of Carbon Dioxide being released every year - a fact revealed by LSU's latest inventory on global ecosystem gases.
CF Industries is expanding their Carbon capture efforts to Ascension Parish. They are investing $200 million in a project that will trap up to 2 million tons annually of Carbon Dioxide emissions from their Donaldsonville plant. The captured emissions will then be transported through a pipeline to an ExxonMobil site in Vermilion Parish.
CF Industries is set to begin constructing a "green" Ammonia production facility in Donaldsonville next year. Once completed, the facility will be capable of producing 20,000 tons of Ammonia annually, starting in 2024.
“We look forward to helping LOTTE and South Korea meet their clean Ammonia requirements as we continue to accelerate the world’s transition to clean energy,” Tony Will, president and CEO of CF Industries, stated.
