Hydrogen Economy Update

C-MACC Hydrogen Economy 20

Blue Is The Color – Ammonia Is The Game

• Weekly Theme: Is Ammonia A Viable Fuel
• News Update
• Projects Update
• Ammonia/Methanol Update
• Power Update
• Next Week: Plugging Some Holes

C-MACC is hosting a webcast call on Thursday, November 16th at 2:00 pm CST to discuss the financial viability of hydrogen and clean energy technologies as recent news suggests funding to be more scarce/expensive. Contact Graham to participate and receive an invitation link.

Key Points

• The rush for blue ammonia, especially in the US, assumes a step change in demand growth, as well as unlikely availability of labor and equipment, renewable power availability will also challenge many.
• The unique features of the 45Q tax structure in the US are driving a hydrogen technology investment that would not make sense anywhere else in the world, but it relies on efficient CCS at low costs.
• We question whether there is room for the new entrants and consequently feel better about the odds of success for the ammonia incumbents, especially those with recent project experience.
• If the world moves aggressively down the (challenging) path of embracing ammonia as the shipping fuel and power stations’ fuel of the future, many of these projects could work; but it is a big “if”.
• Those fabricating in China will have a timing and cost edge, however unpopular, but China provides another risk, as (see our past research), it could drive low-cost green hydrogen/ammonia quickly.

Exhibit 1: What is unlikely a full list of ammonia projects under consideration for the US Gulf

Source: Corporate Reports