In the latest setback for low-carbon ammonia, the Australian natural gas development company Woodside Energy is launching a strategic review—which may include a sale—for its newly acquired blue ammonia plant in Beaumont, Texas. At the same time, a joint venture led by the US fertilizer maker CF Industries Holding has begun construction on a similar project in Louisiana with Japanese partners.
The Texas plant was conceived by OCI Global, which began building it in 2022 at an estimated cost of $1 billion. Woodside purchased the plant in 2024, while it was still under construction, for $2.35 billion as part of a low-carbon investment push. Like regular ammonia, blue ammonia is made from natural gas–based hydrogen, but the by-product carbon dioxide is captured and sequestered.
As part of the project, the industrial gas firm Linde is building and will operate a $1.8 billion autothermal reformer that turns natural gas into hydrogen. ExxonMobil signed on to capture and store the CO2 emissions.
After the facility started up, OCI transferred control of it to Woodside in March. The plant has been running without carbon capture and at only 69% of its capacity of 1.1 million metric tons (t) of ammonia per year. Linde’s plant and ExxonMobil’s carbon storage system aren’t set to be completed until next year.
“This asset was acquired in a global environment with line of sight to a developing market for lower-carbon ammonia, including the international regulatory frameworks required to support that market,” Woodside CEO Liz Westcott said in an Aug. 26 conference call with analysts. “Significant changes in the global environment over the past 12 months have changed this underlying premise.
“We will explore all options to determine the best value for Woodside,” Wescott added. The company is also walking away from a broader plan to spend $5 billion on clean energy projects by 2030.
During the Joe Biden administration, low-carbon ammonia projects blossomed as firms eyed US government incentives to build plants and overseas markets clamored for the reduced-carbon chemical. But uncertainty over the incentives under the Donald J. Trump administration and ebbing interest from potential customers have cooled enthusiasm for low-carbon ammonia and resulted in a wave of cancellations.
In June, for example, Air Products and Chemicals pulled the plug on a project in Louisiana and will write off a loss of $2.9 billion. Last year, Yara and BASF canceled a proposed Gulf Coast blue ammonia project. And late last year, ExxonMobil shelved a blue hydrogen project in Baytown, Texas, citing weak demand.
But not all entrants are retreating from the market. Earlier this week, CF Industries, the energy company Jera, and the trading company Mitsui & Co. broke ground on their blue ammonia project in Modeste, Louisiana. The joint venture, Blue Point One, will cost $3.7 billion and have the capacity to make 1.4 million t of ammonia per year.
As part of that project, Linde will build a $400 million air separation plant to supply the nitrogen that is reacted with hydrogen to make ammonia. The Occidental Petroleum subsidiary 1PointFive and the energy services firm Enbridge will transport and sequester by-product CO2. Some of the resulting ammonia will be used as a fuel in Jera power plants in Japan.
