Uniper and Jera pen US ammonia, LNG deal

Japan’s Jera said it has signed a deal with German energy firm Uniper on procurement and sale of LNG and ammonia from the United States.

Jera Americas entered into memorandums of understanding with Uniper Global Commodities and Uniper Global Commodities North America, according to a statement by Jera.

“The MOU on the procurement and sale of LNG is aimed at improving the stability of energy supply in both Japan and Germany, through cooperation between the two companies, which is an important issue at present,” Jera said.

The two firms are considering jointly optimization of their respective LNG portfolios for supply to Japan and Germany and improvement of them for enhancement of the long-term stable supply.

Based on the MOU of the US “clean ammonia” procurement and sale, the two companies which have potential “sizable demand” for ammonia are collaborating to facilitate large-scale ammonia production projects in the US to address the “global challenge of decarbonization,” Jera said.

Jera and its partner ConocoPhillips are considering development of projects on the US Gulf Coast to produce hydrogen and convert it into “clean ammonia” to be supplied to Jera and Uniper, with the aim of increasing ammonia supply for use in Europe, and in the future, in Japan, and greater Asia, it said.

Ammonia production

Uniper said in a separate statement the two firms would collaborate to facilitate the development of the initial production of 2 mtpa of ammonia with expansion potential up to 8 mtpa, to “greatly accelerate the production and supply of zero-carbon fuels from the US for use in the US, Europe, Japan, and greater Asia.”

The proposed facility on the US Gulf Coast, developed by Jera and ConocoPhillips, aims to produce hydrogen and convert it into clean ammonia.

Jera and Uniper would offtake these volumes under long-term sale and purchase agreements.

Europe would be the primary initial export market, with Uniper targeting about 1 mtpa of green ammonia by the end of the decade, it said.

Uniper said the partners plan to complete a project engineering study will be completed by year end to develop the first phase of this project which will assess green and blue hydrogen opportunities.

The firms expect to reach commercial operation in the late 2020s including a complete certified CCS program.

Additional LNG to Germany

Uniper said that both companies are working jointly to optimize their LNG portfolio.

As a result, Uniper would be able to supply additional LNG to Germany and Jera to Japan and beyond.

“Our collective goal is to jointly develop and deliver material LNG supply in the very near term and US-sourced green and blue hydrogen to Europe to support our longer-term values and goals,” Niek Den Hollander, Uniper’s chief commercial officer, said.

Germany currently has no regasification facilities but the country is fast-tracking LNG imports to reduce reliance on Russian gas and boost energy security.

RWE and Uniper previously chartered four FSRUs on behalf of the German government.

These vessels include the two units RWE chartered from Hoegh LNG, and the Dynagas-owned 174,000-cbm Transgas Force and Transgas Power that will go on charter to Uniper.

Uniper has already started building Germany’s first FSRU-based LNG facility in Wilhelmshaven and expects to commission it this winter, while Dutch gas grid operator Gasunie said it expects the Brunsbuettel FSRU-based LNG import terminal to go online by the end of this year.

Besides these two terminals, Germany has also chosen Stade and Lubmin as the next two locations to install the chartered units.

In addition, Germany recently chose E.ON, Belgium-based Tree Energy Solutions (TES), and a unit of France’s Engie to deploy an FSRU chartered from US player Excelerate Energy in Wilhelmshaven.

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