Industry majors discuss unlocking net-zero potential of new green corridor with clean ammonia

Energy and maritime organisations have gathered to detail plans to accelerate the development of a green corridor for transportation of iron ore between Australia and East Asia.

In June 2022, 13 members of the Getting to Zero Coalition and leading Australian shipping and energy stakeholders formed a taskforce, convened and chaired by the Global Maritime Forum, to support the development of the Australia-East Asia Iron Ore Green Corridor.

The partners got together again in Sydney last month to detail plans of unlocking net-zero potential of the new green corridor by using clean ammonia. Maritime green corridors are routes on which the development and deployment of net-zero-emission shipping solutions (such as clean ammonia as a shipping fuel) are enabled by private and public actions.

The participants included resource companies (BHP and Rio Tinto), shipping companies (Cargill, NYK Line, Oldendorff Carriers and Star Bulk), future fuel suppliers (Fortescue Future Industries, InterContinental Energy, Woodside Energy and Yara Clean Ammonia), as well as other important stakeholders (AMOG Consulting, Bureau Veritas, ClassNK, the Clean Energy Finance Corporation, Maritime Industry Australia Ltd, Scaling Green Hydrogen Cooperative Research Centre Bid, and Pilbara Ports Authority).

Hosted in association with Maritime Industry Australia Ltd (MIAL)’s Maritime Decarbonisation Summit, the roundtable also welcomed local stakeholders from clean energy finance, research, and consultancy sectors.

Several industry action areas were highlighted by as the key for matching clean ammonia supply with demand, including evaluating and quantifying fuel demand and supply, ensuring the safe handling of ammonia, and coordinating investments across the value chain.

The participants also discussed challenges to the industry actions, including issues like cross-sector competition for clean fuels, the need for government support and public acceptance of ammonia as a fuel.

“There is significant and concrete interest in establishing the Australia-East Asia Iron Ore Green Corridor from industry. Coordination between the maritime and energy sectors is critical in order to overcome challenges and scale impact,” Global Maritime Forum’s Senior Program Lead on Decarbonization, and chair of the Roundtable, Marieke Beckmann noted.

“Industry alignment is also important to enable strategic collaboration with the public sector, which could be the main difference-makers going to support first movers in bridging the cost gap for zero-emission fuels.“

As a pathway towards establishing the Australia-East Asia Iron Ore Green Corridor, immediate next steps include the finalization of the ongoing assessment of clean ammonia fuel demand and supply, according to the partners.

This will include assessing the success factors for the corridor’s development – including fuel production, bunkering, potential commercial structures, and high-level regulatory and certification requirements – and their associated timeframes.

The assessment, scheduled for publishing in early 2023, will be undertaken by a consortium led by the Global Maritime Forum in collaboration with BHP, Rio Tinto, Oldendorff Carriers, and Star Bulk.

In the longer term, strategic engagement with public and private sector actors in East Asia, including China, Japan and South Korea, will be critical as the counterpart to the work being undertaken by industry participants in Australia.

The green transition of the shipping industry is picking up pace with shipowners starting to invest in vessels that are technologically prepared to burn alternative fuels such as ammonia.

Uptake of alternative fuels has continued to progress, with 4.8% (2021: 3.7%, 2017: 2.3%) of the fleet on the water and 43.8% (2021: 28.2%, 2017: 10.4%) of the orderbook in tonnage (GT) terms capable of using alternative fuels or propulsion, according to Clarksons. Furthermore, there are currently 130 “ammonia ready” vessels on order.