Woodside, an energy company, has agreed to acquire OCI Clean Ammonia Holding B.V. and its Beaumont, Texas lower carbon ammonia project for about $2.35 billion in cash. The project, currently under construction, aims to produce its first ammonia by 2025 and lower carbon ammonia by 2026. This amount includes capital expenditure through the project’s first phase.
Woodside CEO Meg O’Neill stated that the acquisition aligns with the company’s energy transition strategy, positioning it in the expanding lower carbon ammonia market. This type of ammonia has applications in power generation, marine fuels, and industrial feedstocks.
O’Neill informed that the global ammonia demand is forecast to double by 2050, with lower carbon ammonia making up nearly two-thirds of total demand.
The project is expected to exceed Woodside’s capital allocation targets for new energy projects, with both phases projected to deliver an internal rate of return above 10% and payback in under 10 years. Phase 1 alone will abate 1.6 Mtpa of CO2-e, while Phase 2 will increase this to 3.2 Mtpa, contributing significantly to Woodside’s Scope 3 abatement goals.
Located on the US Gulf Coast, the project will serve both domestic and international markets. Phase 1 will have a capacity of 1.1 Mtpa. Feedstock will be sourced mainly from Linde, with CCS services provided by ExxonMobil. Phase 2, which will add another 1.1 Mtpa production train, is in the pre-final investment decision stage, with a target decision in 2026 and an estimated capital expenditure of $1.2 – $1.4 billion.
The Project will target conventional ammonia customers at start-up and will target lower carbon ammonia customers in Europe and Asia when CCS is operational.
