Newly announced clean fuels joint venture Zero Parks is set to target customers in the marine market by offering them blue ammonia from one of its first investments.
Ken Nicholson, who will be the new chief executive of the New Fortress Energy and US-based Fortress Transportation and Infrastructure tie-up Zero Parks, said the first two investments for the new company will be based on the Jefferson Terminal site in Beaumont, Texas.
Nicholson said the first of these two, $200m to $330m projects will produce renewable diesel and jet fuel and the second carbon-free hydrogen and ammonia.
Offtake focus
He said the technologies and feedstocks for both projects are “well known” and the new venture is now focused on securing the offtake for them.
Answering questions from analysts in a first quarter results briefing, Nicholson said that for blue ammonia the biggest customer base is the shipping market.
- Grey or brown ammonia: Produced from fossil fuels.
- Blue ammonia: Produced using natural gas but with CO2 capture and storage.
- Green ammonia: Produced from hydrogen made through water electrolysis using renewable energy.
“Ships today consume almost no renewable fuel,” he said. “Over the next 20 to 30 years that is going to transition to over half of their fuel needs being from renewable sources, at least according to the IMO standards that are being implemented.”
Nicholson, who is also managing director of Fortress Investment Group, said Zero Parks plans to take financial investment decisions (FIDs) on both projects by the end of this summer.
He said over 10 more projects are currently being evaluated by the company and several more are likely to be concluded in the next six to 12 months.
Big step
“Our goal will be to separate Zero Parks ultimately into a standalone company through an IPO of the business,” Nicholson said.
New Fortress founder and chief executive Wes Edens said his team is already working on the spin-offs plans which would dovetail with the planned FIDs.
Nicholson said he had worked with Edens for 15 years, with the two of them investing over $30bn in infrastructure, transportation and energy companies.
Edens said Zero Parks would be able to create blue hydrogen at $1 per kilogram and capture over 90% of the emissions from this.
He said New Fortress, which last year announced its goal of being a zero emissions company by 2030, will continue to work on its green hydrogen initiatives.
But he said Zero Parks will be a “very substantial company”. “This is a big step for us,” he added.
'Hot and heavy'
Edens, who is travelling to Brazil next week where New Fortress is developing four LNG import terminals, said it has been a “historic and busy quarter” for the rapidly expanding company which recently acquired a 14-vessel fleet in its $5.1bn Hygo-Golar Partners buyout.
The CEO spoke extensively about New Fortress’ Fast FLNG plans.
The company is installing liquefaction units on two Maersk jack-up rigs which it has purchased and expects to put the first of this into operation by the end of 2022.
He said New Fortress is working “hot and heavy” on securing gas for these and also spoke of acquiring semi-submersible rigs in future for more deep water operations.
Ultimately the chief wants to pair the company’s existing import projects with low cost LNG from its Fast FLNG developments.
