McDermott lands FEED deal for $7.5 billion clean ammonia project in Louisiana

Offshore engineering and construction player McDermott has secured the front-end engineering and design (FEED) contract for Ascension Clean Energy (ACE), a global-scale clean ammonia production and export project in Louisiana.

Located in Ascension Parish, the project is jointly developed by energy company Clean Hydrogen Works (CHW) and strategic shareholders ExxonMobil, Mitsui O.S.K. Lines, and Hafnia. The projected investment of the ACE project is $7.5 billion.

Whe first phase of the project is expected to deliver 2.4 million metric tons per annum (mtpa) of clean ammonia by 2028-2029, with expansion in subsequent stages to 7.2 mtpa.

With carbon capture and sequestration (CCS) contracts with ExxonMobil, regulatory approvals expected by early 2025, off-take in advanced discussions, and Goldman Sachs as a financial advisor, the project is expected to reach a final investment decision (FID) by late 2025 and start production in 2029.

Under an engineering services agreement, McDermott will provide FEED, plus engineering, procurement, and construction (EPC) estimating and execution planning services for this project. The work will be led from McDermott’s Houston office with support from its Gurugram, India office.

“This FEED award is testament to McDermott’s industry-leading mega-module delivery and installation expertise, and the breadth of our capabilities across the energy transition,” said Rob Shaul, McDermott’s Senior Vice President, Low Carbon Solutions.

“Our integrated delivery model, with self-perform construction capabilities and portfolio of McDermott-owned, globally diversified, module fabrication yards means we can offer CHW a repeatable modular implementation solution that is expected to maximize value, reduce risk and provide quality assurance.”

Johnny Cook, CHW Senior Vice President of Engineering, Procurement and Construction (EPC), welcomed the selection of McDermott for the project’s FEED work, noting that this collaboration further strengthens key competitive advantages of the ACE project which includes a site with ready infrastructure access to gas, shipping, and carbon capture and storage (CCS), and a shareholder base with expertise in CCS and maritime transport.

Vee Godley, CHW Senior Vice President, Project Development, added: “This transformational project is expected to bring 350 new jobs, 1,500 peak construction jobs and another 1,200 indirect jobs to the area. We look forward to working with McDermott toward our shared goal of constructing and operating a safe, environmentally responsible project. We value direct engagement with the community; this ongoing dialogue is critical in developing a project of which we can all be proud.”