EU Allocates $331M for Fortescue's Green Ammonia Project in Norway

The European Union (EU) is poised to provide approximately $A331.5 million to Fortescue's proposed green ammonia plant in Norway, known as the Holmaneset project. The financial support, derived from the EU Innovation Fund, is contingent on the project reaching financial close, with the first installment to be disbursed at that milestone.

The Holmaneset project is a significant endeavor, featuring a 300-megawatt (MW) plant utilizing hydropower to operate a 280 MW alkaline water electrolyzer, aiming to produce up to 226 kilotonnes of ammonia annually. Fortescue has already given its preliminary approval for investment and is currently engaged in the front-end engineering design (FEED) study. A final investment decision is anticipated in 2025, with the project's operational commencement slated for 2027.

To unlock the EU funding, Fortescue must advance the project further, and the initial disbursement is contingent upon achieving financial close. The EU Innovation Fund, funded by emissions trading scheme contributions, supports the demonstration and commercialization of large-scale, low-carbon technologies.

The ambitious Holmaneset Project aligns with Norway's emissions reduction targets and sustainable industrial development goals, vital for broader emissions reductions across Europe. Fortescue aims to leverage green ammonia to decarbonize its own iron ore shipping requirements, exemplified by the Green Pioneer ship that can utilize green ammonia as a fuel source.

In March, Fortescue secured a long-term hydropower contract from Statkraft, contingent on project financing. The company recently allocated $1.14 billion in investments for three green projects, including a US hydrogen hub in Phoenix, Arizona, a 50 MW green hydrogen project in Gladstone, and the Christmas Creek green steel project in Western Australia.

Holmaneset, if realized, will stand as one of the world's largest ammonia projects of its kind. However, it represents just one facet of Fortescue's extensive pipeline of green energy projects, encompassing hydrogen and ammonia initiatives in Brazil and the geothermal-to-fertilizer Project Chui facility in Kenya.

Fortescue Energy CEO Mark Hutchinson commends the EU's support, emphasizing the Holmaneset Project's pivotal role in fostering a significant green energy value chain. The EU's partnership is recognized as instrumental in propelling the development of a green ammonia industry in Norway and Europe. Fortescue's commitment to a future beyond fossil fuels aligns with the EU's leadership in championing efforts toward global decarbonization.

Furthermore, in October, Fortescue invested approximately A$13.5 million in Norwegian Hydrogen's capital raising, becoming the third-largest shareholder. The company's flagship project in Ålesund, Norway, envisions a 270 MW plant with a 40,000-tonne capacity, indicative of the broader spectrum of Fortescue's involvement in green energy initiatives.