Shipping demand crucial to scale green ammonia

Quantum Commodity Intelligence - Shipping sector demand will be crucial to develop and scale green ammonia production, participants at an industry conference in Brussels stated on Thursday.

Speakers were discussing the outlook for the sector at the DARE2X "What Can Brussels Do For Green Ammonia: European Industry, Policy and Regulations" conference in the Belgian capital on Thursday.

"Global ammonia production is a little under 200 million tonnes annually - if you were to use ammonia in shipping, you could basically double that market between now and 2050," said panellist Stephen Jackson, CEO of Ammonia Europe, who stressed that Ammonia Europe sees the maritime sector as the "main...lead market" for green ammonia demand.

It is "feasible" that as much as "900 million tons of ammonia" could potentially be "needed by 2050," said Topsoe's Rob Stevens, Secretary and President Emeritus at the Ammonia Energy Association (AEA), citing high-case AEA projections which identified the key demand growth areas as shipping, fertiliser, and for ammonia as a hydrogen carrier.

The problem facing green ammonia is "developing the new end uses and ensuring that the fuel is available and available at cost for the new demand markets," stated Jackson.

"We are predominantly targeting the maritime sector and pushing hard for the adoption of the IMO framework," continued Jackson, adding that for the "new value chains" the issue is "demand, demand, demand."

"We need those demand signals, and we need the price of clean fuels to come down," said Jackson.

Regulatory risk

Asked whether the US government's recent threats against the IMO's net zero framework — seen by many as vital to making green ammonia viable as a marine fuel — might undercut projected maritime demand for green ammonia, panellists noted that an agreement could still be reached, without Washington's cooperation.

"We share similar concerns about the US trying to torpedo the whole agreement," said Jackson, but he stressed that in the maritime industry "the US maybe doesn't weigh quite as much as it does in other sectors, and we do have good chances of getting [the IMO legislation] through."

Similarly, Stevens said that the AEA is working with the IMO and emphasised the organisation's international structure, and suggested that shippers might come to use different fuels in different jurisdictions.

Ammonia and methanol

Participants at the conference highlighted ammonia's growing role in shipping, and panellists suggested that ammonia might be able to overtake its main rival as a green fuel, methanol, in the coming years.

There are five operational ammonia-fuelled ships and 69 firm orders, including 29 ammonia carriers and 28 bulk carriers, AEA data stated. And there are a further 415 ships on order which comprise 154 ammonia dual-fuel vessels and 261ammonia-ready, the presentation continued, also noting successful bunkering tests at Rotterdam, Singapore and Pilbara.

Citing legislation and the growing sustainable aviation fuel (SAF) sector, Stevens predicted that "aviation, in my opinion, is going to out-compete shipping for biogenic carbon," supplies of which may be limited. That could in turn help bolster the case for shipping firms to adopt ammonia as a marine fuel.

Engine specialists Everllence — formerly MAN-ES — predicted ammonia will be the "most prominent fuel" for shipping by 2050.

The "toxicity challenge...remains a crucial focus and requires responsible introduction of ammonia as a marine fuel," said Rasmus Holm Bidstrup, a director at Everllence.

Bidstrup also noted that he sees little demand so far for hydrogen as a marine fuel or for on-board crackers due to hydrogen's properties and ammonia's smooth combustion.