The green energy arm of Fortescue Metals Group is investigating a green ammonia supply chain between Australia and Japan.

Fortescue Future Industries, IHI Engineering Australia and IHI Corporation have signed a Memorandum of Understanding (MOU) to explore export avenues between Tasmania and the world’s third largest economy.

The parties will jointly assess the economic and technical feasibility of supplying green ammonia produced in Bell Bay to Japan for blending into existing power generation.

Work under the MOU is a crucial stepping stone to FFI’s feasibility and development program for the 250MW green hydrogen and ammonia Bell Bay project, which will have capacity to produce 25,000 tonnes of green ammonia each year.

Ammonia is considered ‘green’ when it is produced carbon-free with renewable technologies.

Made from hydrogen and nitrogen, ammonia can be used as a clean fuel or converted back into hydrogen as an energy source.

FFI Chief Executive Officer Julie Shuttleworth said the MOU would position all three companies at the forefront of the global green industry.

“The world’s transition to a clean energy future represents a major growth opportunity,” she said.

“Japan is a priority market for green ammonia exports.

“By leveraging our value chain and market access as well as the skills and capability of our people to rapidly develop complex projects, FFI is well placed to meet the future demand of green ammonia.”

FFI Chief Executive Officer Julie Shuttleworth

IHI President and CEO Hiroshi Ide said: “Australia, with an abundance of renewable energy, is a very promising location for large scale ammonia production.”

The MOU comes after Andrew Forrest’s FMG brought forward the company’s net-zero emissions target from 2040 to 2030.

FMG has a number of projects underway associated with ammonia and hydrogen production including a partnership with Kawasaki Heavy Industries and Iwatani Corporation to develop a business model for the supply of liquid hydrogen to Japan.

The company also has a partnership with CSIRO for the development of new hydrogen technologies, including a world-first membrane technology, which provides the potential for large scale hydrogen extraction from ammonia.

Japan is hungry for hydrogen from Australia.

Operations have commenced at the Victorian sites of the Hydrogen Energy Supply Chain (HESC) pilot project—a world-first integrated supply chain that will use Latrobe Valley coal to produce hydrogen for shipment to Japan.