OCI selects Beaumont for new facility

A global producer and distributor of hydrogen-based products that previously picked Southeast Texas as the site for the successful Natgasoline partnership project has again selected Beaumont as the location for another large new facility planned to begin production in the first quarter of 2025.

OCI N.V. (Euronext: OCI) announced Sept. 8 that it will start construction of a world-scale 1.1 million ton per annum blue ammonia project in Beaumont, based on KBR technology. The passage of the U.S. Inflation Reduction Act (IRA) and the enhanced 45Q credits in the Act strengthened the attractiveness of this project, stated OCI when making the announcement.

The U.S. Gulf is a strategic location that allows the facility to serve both the U.S. market and export clean ammonia as a hydrogen carrier to hydrogen-deficient markets around the world, such as Europe and Asia, as well as catering for expected significant demand from new applications including power and shipping fuels. The blue ammonia will be delivered to customers using future zero carbon ammonia-fueled engine ships, leveraging OCI’s global infrastructure.

Nassef Sawiris, Executive Chairman of OCI N.V., commented, “The recent passage of the IRA, which bolsters the regulatory framework and competitiveness of clean ammonia in the U.S., in addition to technological developments in carbon sequestration, is supporting ammonia as a key driver of the energy transition. We believe OCI, a global leader in hydrogen, will play a pioneering role in the future of this industry.”

The project is well underway, with detailed engineering and procurement work having started earlier this year.

Capital expenditure is expected to be within OCI’s guidance of up to $450 million growth capex for the Group in 2023 as highlighted in the Q1 2022 results report. Utilities and available land have been sized to allow for doubling of the capacity by adding an additional 1.1 million ton per annum blue ammonia line in the future.

In June, OCI announced a tripling of throughput capacity at its Port of Rotterdam ammonia import terminal to 1.2 mtpa by 2023, to serve emerging ammonia demand for bunkering to ocean-going vessels and act as a hub to help decarbonize the EU and reduce its reliance on imported natural gas. The new facility is also positioned to supply blue ammonia to OCI’s plants in the Netherlands. The company is currently running its ammonia production platform at c.40% of its 1.2 mtpa maximum capacity in the Netherlands due to the high gas prices but is able to operate value added downstream production and continue to address food security concerns with support from imported ammonia.

Ahmed El-Hoshy,CEO of OCI N.V. commented, “We have been working on this project over the past year to put us in a position to break ground by the end of this year. Alongside our existing blue and green ammonia projects in the U.S. and the Netherlands, at Fertiglobe in the Middle East & North Africa, and our green methanol business, this facility will allow us to continue to build and strengthen our world-leading ammonia and clean fuels platform.”

“We are also very excited to extend our partnerships with Jefferson County, the city of Beaumont, Beaumont ISD, the special districts, and the state of Texas,” he continued. “Their efforts continue to make Southeast Texas an attractive place to do business, and we look forward to continued development in the area and working together to position the region as a clean energy leader.”