Air Products is confident blue ammonia from the US Gulf Coast will be “very competitive” in Europe, according to its CEO Eduardo Menezes.
The industrial gas major recently delayed the start-up of its multi-billion-dollar Louisiana blue hydrogen project to 2028/29, and is looking to divest its stakes in the carbon sequestration and ammonia production elements.
Speaking on today’s Q3 earnings call, in which adjusted operating income was flat at $741m but results outperformed guidance, Menezes said it was looking to confirm third party partnership by the end of this year.
“We are working to get these partnerships done by the end of the year, as we said at the previous quarter. Three months later, I’m reasonably optimistic that we will get there,” he said. “The fundamentals of the [Darrow] project remain very strong. It’s a question of finding the right partnerships and agreements and negotiating them which takes a little time.”
He added the ammonia market is a large one and “continues to generate interest”. Existing ammonia infrastructure makes it a practical solution for transporting and storing hydrogen, which is often difficult to handle in its gaseous form.
“There is a stronger push now for clean ammonia, especially in the Far East, and some bids are coming out from the power producers in Japan and Korea,” said Menezes. “So I think the demand will be there. I strongly believe that blue ammonia from the Gulf Coast will be very competitive in Europe, and there is room for our projects and a few more.”
Air Products continues to work towards a 2027 launch for its Neom megaproject in Saudi Arabia, after pivoting towards green ammonia as it waits for the green hydrogen market and regulatory framework to develop.
Asked to update on other key projects, such as Edmonton, Alberta and Rotterdam, Melissa Schaeffer, Executive Vice-President and Chief Financial Officer, said, “Those are underpinned by customers so those are a little bit of a different flavour to our Neom and Louisiana projects.”
On the previous earnings call, Air Products said ballooning costs and project slip on its planned net-zero hydrogen energy complex in Alberta, first announced in 2021, was in part down to “self-inflicted” project management failures.