South Korean, Malaysian companies sign MoU for green hydrogen/ammonia plant in Sarawak

South Korean companies Lotte Chemical, POSCO and Samsung Engineering have signed a memorandum of understanding with SEDC Energy, a subsidiary of the Sarawak Economic Development Corp. to develop a green hydrogen/ammonia plant at Bintulu in the Malaysian state of Sarawak, Samsung Engineering said Jan. 26.

Dubbed the Sarawak H2biscus Green Hydrogen/Ammonia Project, or H2biscus Project, the envisaged plant will have the capacity to produce 630,000 mt/year of "green" ammonia, 600,000 mt/year of "blue" ammonia, 460,000 mt/year of "green" methanol and 7,000 mt/year of "green" hydrogen, the company said.

Typically, green refers to zero-carbon products produced using renewable energy and electrolysis and blue to a production method that uses natural gas paired with carbon capture technologies to produce low-carbon products.

H2biscus will convert hydropower and natural gas into green hydrogen/methanol and blue hydrogen, and also convert hydrogen to ammonia, with an aim to supply the hydrogen and ammonia to Sarawak and South Korea.

A pre-feasibility study was conducted in 2021 and is expected to be verified by the end of January.

"Samsung Engineering, Lotte Chemical, POSCO and SEDC Energy will be taking an active role in developing the entire cycle of the project including direct investment, construction, transportation and utilization," Samsung Engineering said in a statement.

"After the feasibility study, pre-FEED [front end engineering design] and FEED are completed, the EPC [engineering, procurement, construction] work will be implemented for the H2biscus Project," it added. The cost and schedule for the project were not disclosed.

Samsung Engineering is currently building a 5,000 mt/day methanol plant for Sarawak Petchem at Bintulu that is slated for completion in late 2023. Petronas will market the methanol for Sarawak Petchem for 20 years, with an option for further extension.

Lotte Chemical aims to produce 160,000 mt/year of blue hydrogen by 2030 using hydrogen produced by its naphtha-fed steam cracker and 440,000 mt/year of green hydrogen by 2030 via renewable energy, which will take its overall hydrogen production to 600,000 mt/year.

POSCO plans to focus on expanding and "greening" its steel business after it is spun off into a separate unlisted entity on March 1 that will be 100% owned by a new holding company, giving priority to new businesses such as hydrogen and batteries. The South Korean steelmaker has also joined forces with Australian iron ore miner Roy Hill to conduct joint research on hydrogen and develop hydrogen-based steelmaking processes, including producing hot briquetted iron.