As the industry leaders sign a letter of intent (LOI) on a record-breaking offtake agreement for green fuels in the maritime industry, Ørsted will develop a Power-to-X facility on the US Gulf Coast to fuel Maersk’s newly ordered fleet of 12 methanol-powered vessels.
The global maritime industry’s greenhouse gas emissions have increased dramatically over the last two decades, accounting for roughly 2% of all global energy-related emissions. The maritime sector urgently requires new zero-emission fuels at scale to reduce its climate impact as the world races to combat climate change.
A.P. Moller – Maersk and Ørsted have now signed a letter of intent (LOI) to collaborate on a new Power-to-X facility in the United States, which could be a watershed moment in the green transformation of international deep-water shipping and set the bar for future large-scale production of green maritime fuels.
Ørsted will build a 675 MW Power-to-X facility on the US Gulf Coast, which will produce approximately 300,000 tonnes of e-methanol per year for Maersk’s newly ordered fleet of 12 methanol-powered vessels. The plant will be powered by 1.2 GW of renewable energy generated by new onshore wind and solar PV farms. Carbon capture at one or more large point sources will provide the biogenic carbon required to produce e-methanol.
The project is expected to be completed in the second half of 2025, making it the world’s most ambitious project for producing e-methanol on a large scale and a driving force in the maritime sector’s decarbonization. Late in 2023, a final investment decision could be made.
US Power-to-X market
The 300,000 tonnes of e-methanol are the largest potential offtake agreement for green fuels ever announced in the maritime industry, and it is a testament to both Ørsted and Maersk’s efforts to shape green ocean transport. The agreement also marks Ørsted’s entry into the US Power-to-X market, a new strategic market for the company as it works towards its goal of building 50 GW of renewable energy capacity by 2030.
After the potentially 1,300 MW Green Fuels for Denmark project in Copenhagen, which the two companies are partnering on with other large offtakers, the Power-to-X project in the US Gulf Coast region is the second green fuels collaboration between Ørsted and Maersk. As Maersk works toward its 2040 net-zero commitment, rsted and Maersk will continue to investigate opportunities in green fuels together.
The Power-to-X development pipeline at Ørsted currently includes 11 projects, including the 70 MW FlagshipOne project in Sweden, which Ørsted is developing with Liquid Wind. FlagshipOne is expected to be operational in 2024, making it one of the world’s first large-scale sustainable e-methanol plants. rsted has entered into several strategic agreements with a variety of partners in addition to the project pipeline.
