Exxon Mobil (XOM) inked a pivotal offtake agreement with Marubeni to supply 250,000 tonnes of low-carbon ammonia annually to Japan’s Kobe Power Plant for cofiring. The deal helps to derisk XOM’s hydrogen facility planned at its Baytown complex in Texas and accelerates the final investment decision expected in 2025, with production starting in 2029. The plant will leverage natural gas and CCUS to produce 1 Bcf/d of blue hydrogen and 1 mtpa of low-carbon ammonia. By capturing 98% of CO2 emissions, it would meet Japan’s strict carbon intensity threshold of 0.87 kg CO2e/kg NH3, allowing it to participate in Japan’s contract for difference (CfD) program.
With a lack of demand for clean hydrogen and ammonia in the U.S., manufacturers are looking to foreign markets like Japan, where the CfD subsidizes low-carbon production. By stacking U.S. 45Q tax credits for carbon capture with Japan’s incentives, Enverus Intelligence® Research calculates companies can enhance financial viability, offering competitive pricing against gray ammonia. Securing international offtakers like Marubeni underscores XOM’s lead in scaling blue hydrogen and ammonia, driving decarbonization in Japan’s energy sector and boosting the global hydrogen market’s growth and competitiveness.
DID YOU KNOW?
Companies like Savor Foods are incorporating clean energy technology into the food industry by using green hydrogen, captured carbon and other molecules to produe animal- and plant-free butter and other structured fats.
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About Enverus Intelligence® | Research, Inc. (EIR)
Enverus Intelligence® | Research, Inc. (EIR) is a subsidiary of Enverus that publishes energy-sector research focused on the oil, natural gas, power and renewable industries. EIR publishes reports including asset and company valuations, resource assessments, technical evaluations, and macroeconomic forecasts and helps make intelligent connections for energy industry participants, service companies, and capital providers worldwide. See additional disclosures here.
