Abu Dhabi-based Fertiglobe, winner of the first H2Global renewable ammonia pilot auction, has officially signed a contract with Hintco, an intermediary for the purchase and sale of green Power-to-X (PtX) products under the H2Global financing mechanism.
The agreement represents a turning point in the development of the European renewable ammonia market and global decarbonisation efforts and shows that it is possible to build projects and markets that are consistent with the climate goals of the Paris Climate Agreement.
“The success of the pilot auction also underscores the global cooperation needed to advance large-scale energy transition projects. Initial price signals from the auction suggest that as production increases, costs will fall, paving the way for more competitive prices in future rounds,” said Hintco.
Fertiglobe was selected as the winner of the tender from among five pilot auction finalists in July this year. The pilot auction for Lot 1 for renewable ammonia was launched in late 2022 and attracted interest from over 65 countries and offers from 22 companies/consortia from five continents.
Under the contract, worth up to EUR 397 million, Fertiglobe will start producing renewable ammonia. The first deliveries of potentially 19,500 tonnes are planned for 2027. By 2033, the volumes may increase cumulatively to 397,000 tonnes. The contract price is EUR 1,000 per tonne.
Fertiglobe will source renewable hydrogen from Egypt Green Hydrogen to be used as feedstock for the production of renewable ammonia at the company’s existing ammonia plant in Ain Sokhna.
Timo BollerheyChief Executive Officer of Hintco, commented on the signing of the contract: “This is a significant moment for Hintco, proving that progress in the clean hydrogen market is possible. As exciting as this moment is, my team is already focused on what comes next: new tenders for clean hydrogen purchase and sale contracts. Time is running out and we need to build both the infrastructure and the markets quickly and efficiently if we are to avoid a climate catastrophe.”
Haroon RahmathullaChief Operating Officer of Fertiglobe, added: “This order represents a significant milestone for Fertiglobe as the first renewable ammonia producer to secure long-term offtake and a critical step towards a final investment decision for Egypt Green Hydrogen. We are pleased to leverage H2Global’s support to make our investment in sustainable ammonia commercially viable to advance critical decarbonization technologies while maintaining our disciplined growth strategy.”
