Fortescue and Covestro enter into long-term off take agreement

By Julian Atchison on January 18, 2022

Click to enlarge. FFI will deliver green hydrogen and derivatives to Covestro production locations in North America, Europe and Asia. Source: Covestro Annual Report 2020.

Fortescue Future Industries and German-based polymer manufacturer Covestro have entered into a long-term agreement for the supply of green hydrogen and derivatives, particularly green ammonia. Up to 100,000 tonnes per year of green hydrogen will be delivered to Covestro locations in Asia, Europe and North America, possibly commencing in 2024. FFI has a number of green production projects under development as it looks towards a goal of 15 million tonnes per year green hydrogen output by 2030.

Covestro is a global leader in its field with its materials used in nearly every area of modern life, including in the automotive, construction and electronics industries.

This collaboration reinforces that green hydrogen is a practical, implementable solution for a range of difficult-to-decarbonise industries.

FFI CEO Julie Shuttleworth OAM in the official press release, 17 Jan 2022

Using ammonia for plastics manufacturing

Ammonia is also used as an input to acrylonitrile production, which is an intermediate for a range of durable chemical products, including plastic (e.g. polyacrylonitrile and isocyanates for polyurethanes), rubber (e.g. nitrile butadiene) and fibres (e.g. hexamethylenediamine for nylon 66 and caprolactam for nylon 6).

IEA, Ammonia Technology Roadmap, Oct 2021

Covestro is a leading manufacturer of polyurethanes, and sourcing renewable feedstock for its polymer products is an important part of their overall sustainability strategy. In the announcement, Covestro CEO Dr Markus Steilemann commented that:

Our collaboration with FFI underlines our ambition to pioneer the transition towards a circular economy and climate-neutral production. Green hydrogen and its derivatives play a key role for the chemical industry, both as an alternative feedstock and a source of clean energy. The transition towards green hydrogen and its derivatives will be an important step forward in our efforts to offer more sustainable products that also reduce the carbon footprint of our customer industries

Covestro CEO Dr Markus Steilemann in Covestro’s official press release, 17 Jan 2022