Lotte Chemical has joined forces with CF Industries to collaborate on the U.S. clean ammonia business.
Lotte Chemical struck an MOU with CF Industries at Lotte World Tower in Jamsil, Seoul, on Feb. 27.
Hwang Jin-goo, head of the Hydrogen Energy Business Group at Lotte Chemical, concurrently CEO of the Basic Material Business, and CF Industries CEO Tony Will were present.
Under the deal, the two companies agreed to determine the size of the business through a feasibility study and demand analysis and invest in the production of clean ammonia in the United States.
Lotte Chemical plans to construct local production facilities and import clean ammonia to Korea by making the most of its global infrastructure and CF Industries’ ammonia plant operation and distribution network capabilities.
Lotte Chemical plans to consider producing clean ammonia using carbon capture storage (CCS) technology and supplying it to Korea for power generation and bunkering for ships using ammonia.
Both sides plan to secure the competitiveness of the business by utilizing the U.S. government’s eco-friendly energy policies in accordance with the Inflation Reduction Act (IRA).
The United States is playing hardball to nurture clean hydrogen/ammonia industry by offering tax credits on clean hydrogen production and incentivizing support and building infrastructure in accordance with the implementation of IRA.
Lotte Chemical aims to secure unit price competitiveness, such as production prices and operation costs using improved local investment conditions, and take preemptive steps to meet a rise in clean hydrogen and ammonia demand in Korea.
Hwang, chief of the Hydrogen Energy Business Group, said, “It is important to secure the stable supply of clean hydrogen/ammonia with a focus on regions with less geopolitical risks and rich resources to invigorate the Korean hydrogen economy as soon as possible.”
Lotte Chemical will secure a production center in the United States and dominate the global distribution channel in advance through strategic collaboration with CF Industries with a 60-year history and business experiences, he added.
Lotte Chemical aims to nurture the hydrogen energy business through global clean energy supply and carbon reduction.
The company plans to produce and sell clean hydrogen of 1.2 million tons by investing 6 trillion won by 2030. Lotte Chemical intends to implement global investment and build partnerships to secure the clean ammonia NH3, emerging as a means of transporting hydrogen.
Of late, Lotte Chemical signed a contraction on joint research on a clean ammonia production and export project in Corpus Christi, Texas, in cooperation with the German energy company RWE and Mitsubishi of Japan.
Lotte Chemical Support SME Partners’ Overseas Market Entry
Lotte Chemical helped 73 Korean SMEs enter overseas markets, which reaped 46.7 billion won in sales last year.
The company has implemented diverse shared growth programs, such as offering funds, management consulting, technology, manpower and education programs to build SMEs’ growth environment and ramp up competitiveness of core partners through stable cooperative relations with partners.
Lotte Chemical has backed Korean partners’ overseas market entry and expanded sales since 2019.
The company is supporting Korean SMEs’ overseas market entry in cooperation with Lotte Chemical Titan and six overseas operations in the United States and Europe.
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