OCI Global (OCI), a producer and distributor of hydrogen products, announced that it has reached an agreement for the sale of 100% of its equity interests in its OCI Clean Ammonia project under construction in Beaumont, Texas to Woodside Energy Group Ltd (Woodside) for a total consideration of US$2.35 billion on a cash-free and debt-free basis.
Under the proposed Transaction, Woodside will acquire 100% of the equity interests in OCI Clean Ammonia. Woodside will pay 80% of the purchase price to OCI at closing of the transaction, with the balance of the purchase price payable at project completion, defined as completion of the plant according to certain agreed terms and conditions.
OCI will continue to manage the construction, commissioning, and startup of the facility and will continue to direct the contractors until the project is fully staffed and operational, at which point it will handover to Woodside.
The transaction is expected to close in the second half of 2024, subject to satisfaction of customary closing conditions and receipt of OCI shareholder approval.
About The Project
OCI Clean Ammonia is the world’s first large-scale, low-carbon intensity (CI) hydrogen-based greenfield ammonia facility, which began engineering in late 2021, construction in December 2022, and is expected to produce first ammonia in 2025. The project is a collaboration between OCI and Linde that integrates Linde’s low CI hydrogen production and carbon capture technology with OCI’s ammonia production, storage, and transportation infrastructure. In addition, Linde has contracted with ExxonMobil for carbon dioxide (CO2) transportation and sequestration infrastructure. In its first phase, the project will result in the capture and sequestration of 1.7 MTPA of CO2 for OCI that would otherwise have been released to the atmosphere.
OCI Clean Ammonia is anticipated to meet blue ammonia specifications by any standard announced to date. According to OCI, it is the only blue ammonia facility under construction globally, capable of producing 1.1 MTPA of blue ammonia in its first phase, with the necessary infrastructure and utilities in place to double that capacity in its existing plot plan. This design philosophy and oversized infrastructure is expected to provide significant savings on budget and timeline for the ‘plug and play’ second line over any newbuild projects of similar nature. Permitting for the second line has been submitted and is expected to be received by year-end.
“We are exceptionally proud to have put in motion on a global scale the first [final investment decision] FID’d blue ammonia project, with first production expected in less than a year from now,” said Nassef Sawiris, executive chair of OCI. “This pioneering investment will contribute to the global availability of low-carbon intensity ammonia, with significant potential to reduce carbon emissions in hard-to- abate sectors, including existing markets in fertilizer and industrial sectors, as well as in new applications in power and shipping. We are confident that in Woodside we have found the rightful custodian for this landmark asset and its talented employees. Under Woodside’s leadership, OCI Clean Ammonia will play a vital role in the global energy transition, delivering new energy products and lower carbon services to reduce Woodside’s customers’ emissions globally.”
“I would like to thank the entire OCI team for helping to develop and build such a ground-breaking project,” said Ahmed El Hoshy, chief executive officer of OCI. “We are confident that Woodside, as future owner and operator of OCI Clean Ammonia, will add significant value to this peerless collaboration. We look forward to working closely with the Woodside management team to fully complete the facility in the coming months, and to ensure continuity and successful stewardship through closing and beyond.”
“Reflecting upon our 30-year track record as an investor, developer and operator, we are extremely proud of the journey OCI has undertaken thus far, across sectors, across geographies, continuously deploying our DNA into the creation of successful projects,” said Hassan Badrawi, chief financial officer of OCI.
