Petronas unit to partner with Itochu, Inter Pipeline to construct blue ammonia, methanol plants in Canada

Petronas unit to partner with Itochu, Inter Pipeline to construct blue ammonia, methanol plants in Canada
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KUALA LUMPUR (May 13): Petroliam Nasional Bhd (Petronas)’s subsidiary Petronas Energy Canada Ltd (Petronas Canada) is partnering with Canadian firm Inter Pipeline Ltd and Japanese firm Itochu Corp on the commercial production of blue ammonia and blue methanol in Canada by 2027.

The proposed project would consist of two facilities based in Alberta, with early expectations, pending the results of a technical evaluation, of producing world-scale volumes of blue ammonia with blue methanol volumes.

“This opportunity is dependent on a thorough risk assessment to be conducted by Inter Pipeline, Itochu and Petronas Canada, and a commercial arrangement between the partners. The partners are expected to reach a final investment decision in early 2024. If sanctioned, construction would commence in late 2024 with a 2027 in-service date,” said Inter Pipeline in a statement on Wednesday (May 11).

Blue ammonia is an efficient method of transporting hydrogen, a much sought-after energy source that contains no carbon. Blue methanol serves as a versatile building block for countless everyday products, including adhesives and construction materials, and is being evaluated for use as a low-carbon fuel for industries such as shipping.

“This project would be among the first of its kind in North America,” said Inter Pipeline president and chief executive officer Brian Baker.

“Once operational, these facilities would be at the forefront of diversifying Canada’s abundant supply of raw resources by converting them to value-added, energy transition products to supply growing global markets with low or no-carbon fuel and energy products,” he added.

One of the target markets for blue ammonia is Japan, which has set a target to reach net-zero GHG emissions by 2050. As part of that plan, the Japanese Ministry of Economy, Trade, and Industry (METI) announced that ammonia and hydrogen will play key roles in meeting its national clean energy targets in part by replacing coal as fuel in thermal power generation, Inter Pipeline noted.  

In August last year, Nikkei Asia reported that Itochu has agreed to conduct a joint feasibility study with a Canadian subsidiary of Petronas on the commercial production of ammonia in Canada in 2026.

“The US$1.3 billion (about RM5.49 billion) plant will manufacture ammonia from natural gas extracted from a field owned by the Petronas unit, making up to one million tonnes per year.

“Ammonia generates no carbon dioxide when burned and can be blended with coal to reduce emissions at fossil-fuel power plants,” the report said.

Inter Pipeline is a major petroleum transportation and natural gas liquids processing business based in Calgary, Alberta, Canada. Inter Pipeline owns and operates energy infrastructure assets in Western Canada and is building the Heartland Petrochemical Complex — North America’s first integrated propane dehydrogenation and polypropylene facility.

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Japan’s Itochu to conduct feasibility study with Petronas’ subsidiary in Canada on production of ammonia

Esther Lee