Petronas feasibility study for $1.3B hydrogen project

The Canadian subsidiary of Malaysia’s state-owned oil company Petronas proposes to conduct a feasibility study on the construction of a $1.3 billion petrochemical factory in central Alberta with the goal of exporting hydrogen to Asian markets.

Petronas Energy Canada Ltd. has partnered with Japan’s Itochu Corp. and an unnamed Calgary-based pipeline firm to conduct a feasibility study on a facility capable of producing 1 million tonnes of ammonia per year while sequestering carbon emissions.

Ammonia is produced when nitrogen and hydrogen are combined, which in this case would come from Petronas’ natural gas activities in northeast British Columbia.

Both Petronas and Itochu, a Japanese conglomerate, intend to jointly market the ammonia produced at the facility in Asian markets, “possibly for thermal power generation in Japan, potentially replacing hydrocarbon-based fuels in power plants, steel production, and chemical production, among other applications.”

If the firms opt to ahead with the project, building is expected to begin in 2023 and ammonia production to begin in 2027. The companies estimate that building of the plant will generate 10,000 direct and indirect jobs during construction and 3,300 permanent jobs once it is operational.