The first Russian-German low-carbon ammonia supply chain

By Julian Atchison on January 12, 2022

Yamal Peninsula LNG in Siberia, where Novatek's planned blue ammonia facility is to be built. Source: Novatek.
Click to learn more. Yamal LNG in Sabetta, Siberia, where Novatek’s planned blue ammonia facility is to be built. Source: Novatek.

Uniper and Novatek have signed a long-term supply agreement to transport up to 1.2 million tonnes of blue ammonia annually from Siberia to Wilhelmshaven. Novatek’s to-be-built blue ammonia plant was announced in June last year and will be located on the Yamal Peninsula in Siberia, adjacent to the existing Yamal LNG facility. Uniper announced in April last year that their current coal power station in Wilhelmshaven, Germany would not become an LNG import facility as originally planned, but a “climate-friendly” hydrogen hub that features ammonia import terminals and cracking facilities.

This project would cover a significant share of the low carbon hydrogen demand in Germany…Germany, like many other heavily industrialized countries, will rely on hydrogen imports, as the demand for hydrogen will exceed domestic production capacities….I firmly believe that Novatek, which has already developed a state-of-the-art LNG facility on Yamal, will deliver one of the world’s most efficient and cleanest ammonia export projects providing Europe with ammonia and hydrogen featuring a carbon footprint below the EU Taxonomy threshold.

Klaus-Dieter Maubach, CEO of Uniper in their official press release, 22 Dec 2021

Our strategy pays significant attention to clean energy supplies, and we consider ammonia as the most efficient hydrogen carrier for seaborne transportation. We are now at the pre-FEED stage for a low-carbon ammonia and hydrogen plant with CCS facilities, and signing of term sheets for long-term supply demonstrates growing demand for low-carbon products, which is an essential precursor for the Final Investment Decision on this project. The plant will be located next to our LNG cluster in Yamal in order to minimize the infrastructure costs and provide the most competitive clean energy supplies to the global market.

Leonid Mikhelson, Chairman of NOVATEK’s Management Board in their official press release, 22 Dec 2021

Ammonia MoUs for Novatek in 2021

The signed term sheet with Uniper wasn’t the only significant ammonia announcement from Novatek in 2021:

  • an agreement with Russian steel maker Severstal to implement a joint pilot project on blue hydrogen production via CCS, with supply in the form of ammonia.
  • an agreement with METI to support market development and share research on CCS (and other low-carbon technologies) in Japan and Russia.
  • an agreement with Japan Bank for International Cooperation to work together on hydrogen and ammonia projects, including the Yamal Peninsula plant.
  • and an agreement with RWE to develop the foundations for future low-carbon ammonia supply from Siberia to Germany. A second major term sheet might not be too far away!