CWP Global slows down Mauritania green hydrogen/ammonia plans
Quantum Commodity Intelligence - CWP Global is taking a breather on its plans to start producing green hydrogen and green ammonia in Mauritania because offtake agreements from its planned project have failed to materialise.
The decision was confirmed by CWP's founder and CEO, Mark Crandall, this week, and echoes recent statements made by other aspiring low carbon ammonia and hydrogen producers over the last few months, who say firm offtake commitments are hard to come by.
Three years ago, CWP signed a framework agreement with the Mauritanian government to develop a green hydrogen/ammonia project which would run on 18 GW of wind power and 12 GW of solar capacity, and be located in the country's Dakhlet Nouadhibou and Inchiri regions.
The facility - the AMAN project - was expected to start up in 2029-30 and produce 10 million mt of green ammonia annually, or 1.7 million mt/year of green hydrogen at full capacity.
"The issue here is 100% offtake-related. The Mauritanians have acted very intelligently to help us keep the projects developing despite the disappointing lack of offtake - so Mauritania will make it, eventually, without doubt," Crandall told Quantum this week.
"But the waiting for offtake is painful for everybody involved. Mauritania can probably produce the least expensive new-built green energy in the world, and the government understands that," Crandall said.
The CWP boss noted that the decision to hold off on the project was not linked to Mauritania's renewable energy, or local regulation. "There is no issue with regulation in Mauritania - they have done a good job with that," he said.
Crandall sees the lack of any offtake interest urgency as being squarely linked to carbon policy, particularly in the EU, where carbon tax will remain too low in the short-term to push the green transition.
"I think it's a failure of regulation. The EU ETS trades at too low of a number for this to work, and the solution is obviously to increase the cost of carbon. But we are not there yet," Crandall said.
Angola project
In Angola, FID on a 600 MW green hydrogen/ammonia facility, which CWP partnered on with local oil supplier Sonangol, along with Gauff Engineering and Conjuncta late last year, also looks set to miss its 2025 target.
"Angola has excess hydropower, so in theory could be a great place to do PtX," Crandall told Quantum.
"But the same offtake issue remains - for now there is nobody out there who wants to buy green ammonia [or even blue] at a price that works for the producers," he said.
On whether slow progress on the offtake front was linked to the lack of any significant low carbon ammonia supply being available, Crandall said "I don't think this is a supply-side issue" but more to do with blue and green ammonia costing more than grey ammonia.
"And so far nobody is compensating the potential consumers to help them pay for the more expensive stuff," says Crandall, noting that even in Europe there is no appetite to buy low carbon ammonia because sellers cannot pass on the premium if they upgrade it to a green nitrogen fertiliser.