Shift Towards Low-Carbon Hydrogen in Ammonia and Methanol Industries: GlobalData Report

Petrochemical capacity of main commodities

The industrial demand for ammonia and methanol has long been a cornerstone of various sectors, including agriculture, manufacturing, and construction.
Petrochemical capacity of main commodities
However, the conventional production processes of these chemicals have contributed significantly to carbon emissions. In response, governments worldwide are intensifying efforts to decarbonize these crucial industries.

GlobalData says the evolution of low-carbon hydrogen, a vital component in the production of ammonia and methanol, could play a pivotal role in reducing emissions from these processes.

The report, which shares insights on the developments within the low-carbon ammonia and methanol markets, evaluates industry leaders like Yara International, CF Industries, SABIC, OCI, and Nutrien based on their capacity, emissions intensity, and net-zero commitments in low-carbon ammonia and methanol production.

Ravindra Puranik, Oil and Gas Analyst at GlobalData, highlights the industry’s shift towards low-carbon solutions: “Companies such as Yara and CF Industries are actively leveraging low-carbon hydrogen and carbon capture technologies to decarbonize their production processes for ammonia and methanol.”

The report emphasizes the potential of green hydrogen, produced via renewable energy-powered electrolysis of water, in generating green ammonia and methanol. Additionally, blue hydrogen, created using carbon capture technologies, offers a viable long-term alternative for transitioning ammonia and methanol production.

Ammonia, a crucial petrochemical largely demanded in the agricultural sector, and methanol, with significant installed capacity in manufacturing, stand to benefit from the use of low-carbon hydrogen in their production. This transition can also aid in mitigating emissions from their diverse end-use applications.

Puranik further notes the potential for ammonia as a fuel in shipping and power generation, while low-carbon methanol could be blended with traditional fuels like gasoline and diesel. Addressing the shipping industry’s emissions, the International Maritime Organization (IMO) is considering ammonia and methanol among the options for achieving its net-zero goals.

Anticipating strong growth, the report predicts a rise in both blue and green ammonia and methanol plants by the end of this decade. With hydrogen being a linchpin for global decarbonization efforts, the success of low-carbon ammonia and methanol is intrinsically linked to the advancement of low-carbon hydrogen technologies.

The year 2030 will be a potential milestone for the ammonia and methanol markets, given the ongoing investments in low-carbon initiatives and the steady trend towards decarbonization in the industry.