Incitec (ASX:IPL) & Fortescue (ASX:FMG) hit Green Ammonia milestone

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Incitec (ASX:IPL) & Fortescue (ASX:FMG) hit Green Ammonia milestone

Incitec, Fortescue Future, FMG, IPL, Green Ammonia, ASX, Green solution, ESG
Image source: © Leestat | Megapixl.com

Highlights 

  • Incitec Pivot’s green ammonia production facility at Queensland can now be run on hydrogen.
  • FFI and IPL reach technical milestone and will now progress a FEED study.

Fortescue metals Group’s (ASX:FMG) green solutions company Fortescue Future Industries (FFI) and Incitec Pivot Limited (ASX:IPL) have completed their initial studies to convert Incitec’s ammonia-production facility to a green hydrogen run plant , instead of fossil fuels.

What is the milestone hit by FFI and Incitec?

  • The first phase of studies, conducted by FFI has proved technically feasibility on the same. Thus, FFI has issued IPL a notice to move on to the next phase of conversion studies.
  • FFI can now demonstrate technical and economic feasibility of fossil fuel infrastructure conversion at Incitec’s Gibson island plant.
  • Therefore, FFI and IPL are to now enter a round of negotiations to progress a Front End Engineering Design (FEED) study at the Queensland facility.
  • The FEED study will give more clarity on cost, time line for conversion and permits and commercial agreements, essential for a potential Final Investment Decision (FID).
  • Dr Andrew Forrest, has termed it a significant development in a project that aims to accelerate de-carbonisation in Queensland.
  • Also, the integration between FFI’s collaboration and Incitec Pivot is to fast track the production of green ammonia at an industrial scale.

Also Read: Green Hydrogen push revives Fortescue Metals (ASX:FMG) share price

How will FFI & IPL’s green ammonia project help in de-carbonisation?

  • Fortescue’s green energy company will now construct an electrolysis plant at IPL’s Queensland site.
  • If FFI and IPL are successful with the Queensland project, it will create a new market for green, renewable ammonia and boost manufacturing jobs in the region.
  • The Green hydrogen and green ammonia produced will also provide a low-carbon fuel for the Port of Brisbane, Brisbane airport and other heavy transport users in the territory.
  • IPL and FFI’s proposed project align with the governments’ strategy to develop innovative and competitive green hydrogen industry for export opportunities.

Bottom line

Although the Incitec project is pending further approvals, it could be Australia’s first green ammonia production facility. It will also demonstrate to the industry that existing infrastructures can be retrofitted to become a zero-emissions energy source economically.

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