Woodside Energy Group Ltd., Australia’s leading energy producer, has announced the acquisition of a clean ammonia project in Texas for $2.35 billion.
This significant move follows Woodside’s recent major acquisition of Tellurian Inc., a liquefied natural gas developer, for $900 million.
Acquisition Details
Woodside will purchase OCI Clean Ammonia Holding BV from Dutch chemicals company OCI NV in an all-cash transaction.
The plant, currently under construction, aims to commence production in 2025, with lower-carbon ammonia output anticipated to follow a year later.
The announcement of this acquisition saw OCI shares surge by as much as 11% at the opening in Amsterdam.
Strategic Importance
“This transaction positions Woodside in the growing lower carbon ammonia market,” stated Woodside Chief Executive Officer Meg O’Neill.
She emphasized that global ammonia demand is projected to double by 2050, with lower-carbon ammonia expected to account for nearly two-thirds of the total demand.
Project Specifications
The Beaumont project, in its first phase, will have a capacity of 1.1 million tons per year. The addition of carbon capture and storage technology will enable the production of lower-emission ammonia starting from 2026.
Woodside has secured agreements for the necessary feedstock and carbon capture capacity with Linde Plc and Exxon Mobil Corp.
Clean Ammonia Production
Currently, most ammonia is produced using natural gas. However, ammonia can also be made using hydrogen derived from green energy sources and nitrogen from the air, creating a potential zero-emissions fuel suitable for shipping and power plants.
This innovative approach to ammonia production aligns with the global shift towards more sustainable and lower-carbon energy solutions.
Recent Acquisitions
The purchase of the clean ammonia project marks Woodside’s second significant acquisition in the U.S. in a short span.
Less than two weeks prior, Woodside had agreed to acquire liquefied natural gas developer Tellurian Inc. for $900 million.
These acquisitions underscore Woodside’s strategic focus on expanding its footprint in the U.S. energy market and investing in cleaner energy technologies.
Conclusion
Woodside Energy’s acquisition of the clean ammonia project in Texas represents a major step in its strategy to capitalize on the growing demand for lower-carbon ammonia.
With global ammonia demand expected to rise significantly, this investment positions Woodside as a key player in the transition to more sustainable energy solutions.
The partnerships with Linde Plc and Exxon Mobil Corp. further bolster the project’s potential to deliver lower-emission ammonia, contributing to the broader goal of reducing carbon footprints in energy production.