LOTTE Chemical Partners with the World’s Largest Ammonia Production Company,
‘CF Industries’ of the US
- Entered Production MOU for Clean Ammonia in the US
■ LOTTE Chemical enters cooperative MOU for investing in clean ammonia production in the US and for implementing in Korea with the world’s largest ammonia production company, CF Industries that is based in the US… Creating synergy in the ammonia plant operations knowhow of CF Industries that the global infrastructure of the two companies
■ Utilizing the US government’s hydrogen business fostering support policies and incentives with the implementation of IRA... Expected to make clean ammonia business investment costs efficient and secure cost competitiveness
■ LOTTE Chemical Hydrogen Energy Business Unit Director Hwang Jin-goo, "We will establish a bridgehead for promoting the domestic hydrogen economy by securing a clean hydrogen/ammonia production base in the US and securing stable supply”
■ CF Industries CEO Tony Will, "We will response to the increasing demand for clean ammonia in Korea through mutual cooperation and work on accelerating the global conversion to clean energy together"
LOTTE Chemical will team up with CF Industries Holdings Inc., the world’s largest ammonia production company based in the US, to cooperate in the clean ammonia business in the US.
The two companies met at the Jamsil LOTTE World Tower in the afternoon of the 27th where LOTTE Chemical Hydrogen Energy Business Unit Director (and president of the Basic Materials Unit) Hwang Jin-goo and CF Industries CEO Tony Will were in attendance to sign an MOU.
With this MOU, the two companies confirmed the scale of the business through feasibility surveys and demand analysis, and agreed to cooperate in investing in clean ammonia production in the US including the area in Louisiana. By utilizing the global infrastructure of LOTTE Chemical and the ammonia plant operation and distribution network capacities of CF Industries, they are looking toward the construction of local production facilities and sending the clean ammonia to Korea. Plans are to produce clean ammonia by applying carbon capture and storage (CCS) technologies and supplying it to Korea to be used for generating electric power, bunkering that supplies it to ships using ammonia, etc.
The two companies intend to fully utilize the eco-friendly and energy support policies of the US government according to the ‘Inflation Reduction Act (IRA)’ to secure business competitiveness. The US is actively fostering the clean hydrogen/ammonia business by offering tax deductions for producing clean hydrogen and incentives for building infrastructure through the IRA. It plans to utilize the improved local investment environment to secure cost competitiveness such as production price and operating expenses, and preemptively prepare for the domestic demand for clean hydrogen/ammonia that is expected to increase.
LOTTE Chemical Hydrogen Energy Business Unit Director Hwang Jin-goo said, “In order to activate the domestic hydrogen economy early on, it is crucial to secure stable clean hydrogen/ammonia supply focusing on overseas areas with abundant resources and low geopolitical risks,” and added, “We will secure a production base in the US and lead the global distribution channel through a strategic partnership with CF Industries that has a long history and extensive business knowhow spanning across over 60 years.”
LOTTE Chemical is pursuing the hydrogen energy business for global clean energy distribution and carbon-reduced growth, and it has established plans to invest a total of 6 trillion KRW by 2030 to produce and sell 1.2 million tons of clean hydrogen. It is carrying out global investments and building partnerships in various ways to procure clean ammonia (NH3) that is receiving attention as the hydrogen delivery vehicle for constructing the optimal supply chain domestically and internationally.