RWE, Hyphen sign MoU for offtake of 300 000 t/y of green ammonia from Namibia

2nd December 2022 By: Darren Parker - Creamer Media Contributing Editor Online

Multinational energy company RWE and green energy developer Hyphen Hydrogen Energy have signed a memorandum of understanding (MoU) that could see RWE buy up to 300 000 t/y of green ammonia from Namibia from 2027.

Ammonia is one of the most common basic materials in the chemical industry. More than 180-million tons a year is produced globally and processed into fertilisers or used in chemical processes, besides other applications.

To make ammonia green, fossil energy such as natural gas is replaced by electricity from renewable energy sources during production. Ammonia has several advantages over hydrogen, which is used throughout the molecular chain, making it easier, more efficient and cheaper to store and transport.

Hyphen was appointed the preferred bidder by the Namibian government to develop the first green hydrogen project in that country for export. By 2027, the project is expected to produce 1.7-million tons of green ammonia as a hydrogen derivative that is particularly suitable for transport by ship.

German renewable energy project developer Enertrag is a joint venture partner of Hyphen.

“We are delighted to reach this agreement with RWE. This milestone underpins our ambitious targets to export green hydrogen globally from Namibia. By establishing strong connections with policymakers and offtakers across Europe, we are working with the government of Namibia to develop the industry, which will spearhead Southern Africa’s role in achieving regional and global decarbonisation goals,” Hyphen CEO Marco Raffinetti said.

RWE is committed to develop a globally diversified portfolio of long-term offtake agreements for green hydrogen and its derivatives, such as ammonia.

In this context, RWE announced in March its plan to build a terminal for green ammonia in Brunsbu╠łttel, Germany, by 2026. This terminal could serve as one port of destination for Namibian ammonia.

"Green molecules are the only way for many industries in Germany to achieve their climate targets. In the long term, Germany's demand for them will have to be met mainly through imports.

“That's why we're looking forward to progressing the offtake discussions with Hyphen – to bring green ammonia from Namibia to Germany," RWE supply and trading chief commercial officer Ulf Kerstin said.