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Japan moves to develop fuel ammonia supply chain with potential 20 mil mt/year demand

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Japan moves to develop fuel ammonia supply chain with potential 20 mil mt/year demand


Fuel ammonia seen as effective for carbon neutrality

METI sees fuel ammonia as zero-emission fuel which can be deployed quickest

Series of pilot projects underway for co-burning ammonia

  • Author
  • Takeo Kumagai
  • Editor
  • Jonathan Dart
  • Commodity
  • Coal
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  • Energy Transition

Japan on Oct. 27 launched a fuel ammonia council to consider ways of developing its supply chain as it sees ammonia as one of the fuels which could be burnt together with coal, with potential demand equivalent to the current global trade volume of 20 million mt a year.

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The launch of the fuel ammonia council came just a day after Prime Minister Yoshihide Suga said that Japan would aim for carbon neutrality by 2050, bringing forward the previous target of early in the second half of the century.

"While our country is heading for a carbon-neutral society, ammonia, which does not emit CO2 when combusted, is seen an effective fuel to co-burn with coal in thermal power generation," director-general of oil, gas and mineral resources at the Ministry of Economy, Trade and Industry, Ryo Minami, said at the launch meeting.

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Ammonia, a compound consisting of three parts hydrogen and one part nitrogen, contains about 18% hydrogen by weight and is already a widely traded chemical globally, and it releases zero CO2 emissions when burnt in a thermal power plant.

Minami said Japan needed to establish a supply chain for fuel ammonia because the current size of the market and existing supply chain would not be sufficient to meet the huge potential demand.

"If our country co-burns 20% at all of its coal thermal power plants, fuel ammonia consumption would be about 20 million mt/year -- a level equivalent to today's global trade volume," Minami said .

The fuel ammonia council, which consists of government and private sector representatives, aims to compile its roadmap and measures for the introduction and mass-use of the fuel in the first half of 2021 after several rounds of discussion.

2030 target

"We see fuel ammonia as the fastest zero-emission fuel to be fully-fledged by 2030 in the sense of mass implementation," Minami told S&P Global Platts. He said that Japan could be consuming a couple of million metric tons of fuel ammonia by 2030.

"While we are proceeding with our study, we understand it [fuel ammonia] is no longer at the research and development stage as we are seeing an increasing number of people expressing a genuine interest in buying and selling," Minami said, adding that a point had now been reached where things were ripe for further discussions with the private sector.

Japan currently uses about 1 million mt/year of ammonia, of which roughly 200,000 mt is imported, he said.

Japan plans to start test burning 20% of ammonia at JERA's 4.1-GW, Hekinan coal-fired power plant in central Japan from fiscal 2021-22 (April-March) as part of a feasibility study run by state-owned New Energy and the Industrial Technology Development Organization.

JERA, one of the world's largest power producers, said Oct. 13 it plans to shut down all inefficient coal power plants by 2030, introduce the combustion of ammonia at its thermal power plants by 2040, hydrogen co-firing by 2050 and expand renewable energy, mainly offshore wind power, as part of its roadmap to net zero carbon-dioxide by 2050.

Japan started Oct. 26 a series of test runs to burn blue ammonia shipped from Saudi Arabia, beginning with co-burning at a gas turbine as part of a pilot project, following recent receipt of the maiden cargo.

Japan's IHI started burning part of the Saudi blue ammonia at its 2-MW gas turbine at its Yokohama office as part of the pilot project, the Institute of Energy Economics, Japan, said in a statement.

The latest development came as part of the pilot study, supported by METI, which is being conducted by the IEEJ and Saudi Aramco in partnership with Saudi Basic Industries Corp.

The Saudi-Japan blue ammonia supply demonstration study covers converting hydrocarbons to hydrogen and then to ammonia, as well as the capture of associated CO2 emissions, the IEEJ said in a joint statement on Sept. 27.

As part of the study, the first blue ammonia cargo of 40 mt was shipped from Saudi Arabia to Japan to be used for power generation, with 30 mt of the CO2 captured during the process designated for use in methanol production at SABIC's Ibn-Sina facility, and another 20 mt of captured CO2 in the process being used for Enhanced Oil Recovery at Aramco's Uthmaniyah field.