CF Industries and POSCO Explore US Clean Ammonia Project & South Korea Offtake Deal

CF Industries Holdings, Inc., the global leader in ammonia production, has joined forces with POSCO Holdings Inc., South Korea’s foremost steel manufacturer to explore the possibility of establishing a groundbreaking joint venture.

This venture aims to construct a cutting-edge low-carbon clean ammonia plant, strategically located at CF Industries’ Blue Point Complex in Ascension Parish, Louisiana, within the United States. In addition, it seeks to establish a dependable source for long-term supplies of low-carbon clean ammonia to be shipped to South Korea.

As part of this extensive assessment, CF Industries and POSCO will embark on a comprehensive front-end engineering and design (FEED) study, focusing on auto thermal reforming (ATR) technology for ammonia production. The ATR technology, when seamlessly integrated with carbon capture and sequestration (CCS) methods, is anticipated to deliver a remarkable reduction in carbon dioxide (CO2) emissions from the ammonia production process. This reduction is estimated to exceed 90% compared to conventional ammonia plants that lack CCS capabilities. This advancement will enable the resulting low-carbon clean ammonia to adhere to the stringent standards set by the South Korean government’s Clean Hydrogen Energy Portfolio Standard.

In the event that this ambitious project progresses to fruition, POSCO envisions the importation of substantial quantities of low-carbon clean ammonia from this facility to South Korea. This importation is set to play a pivotal role in supporting POSCO’s ongoing efforts to decarbonize its own coal-based power generation facilities, as well as those of third-party entities. Furthermore, POSCO plans to harness this low-carbon clean ammonia to produce hydrogen, fostering its utilization in gas-based power plants and incorporating it into the steel production process, thereby achieving substantial reductions in carbon emissions throughout its operations.

“We are pleased to collaborate with POSCO to support both their decarbonization goals as well as those of South Korea,” said Tony Will, president and chief executive officer, of CF Industries Holdings, Inc. “POSCO’s concrete plans to use low-carbon ammonia to accelerate decarbonization in steel manufacturing and power generation in South Korea represent significant new demand for low-carbon ammonia as a clean energy source. We look forward to leveraging our two companies’ industry-leading expertise to advance our shared commitment to a more sustainable future.”

Yoo Byeong-ok, Chief Green Materials & Energy Business Officer at POSCO Holdings, stated, “The United States is one of the key strategic regions for POSCO Group as it is actively pursuing the establishment of an economically and reliably overseas hydrogen and ammonia supply network through the IRA support policy.” He further explained, “We plan to establish a production hub for clean ammonia in the United States in collaboration with CF Industries, the largest ammonia producer, and secure a stable supply network to timely provide clean hydrogen necessary for domestic power generation and hydrogen reduction steelmaking.”

The FEED study is expected to be completed in the second half of 2024, with a final investment decision by CF Industries and POSCO to follow.

Since 2020, CF Industries has advanced industry-leading projects to decarbonize its ammonia production network and position the Company to supply a substantial volume of low-carbon clean ammonia within the next few years. This includes leveraging CCS technologies at its Donaldsonville Complex where CF Industries is constructing a CO2 dehydration and compression facility to enable the capture and permanent sequestration of up to 2 million tons of CO2 per year with ExxonMobil, starting in 2025.

The Company has also commenced a front-end engineering and design study with Mitsui & Co., Ltd. to construct a greenfield low-carbon clean ammonia facility utilizing steam methane reforming (SMR) ammonia technology along with CCS at its Blue Point Complex in Louisiana. Additionally, CF Industries is constructing North America’s first commercial-scale green ammonia capacity at its Donaldsonville Complex, enabling up to 20,000 tons of green ammonia production beginning in 2024.