Woodside has completed the acquisition of 100 percent of OCI Clean Ammonia Holding B.V., the entity responsible for OCI N.V.’s lower carbon ammonia project in Texas. This follows Woodside’s announcement on 5 August 2024 regarding its agreement to acquire OCI’s 1.1 million tonnes per annum Clean Ammonia Project. Upon the implementation of carbon capture and sequestration, the project will produce ammonia with less than 35 percent of the lifecycle emissions intensity of conventional, unabated ammonia.
Woodside CEO Meg O’Neill emphasised the strategic significance of the acquisition, stating that it positioned Woodside as an early leader in the growing lower carbon ammonia market. She noted, “As a global energy provider, Woodside is focused on lower carbon ammonia and its increasingly important role in the world’s energy mix. Its potential applications span power generation, marine fuels, and industrial feedstocks, offering an alternative to higher-emitting fuels.”
O’Neill highlighted the expected surge in global ammonia demand, which is forecast to double by 2050, with lower carbon ammonia projected to account for nearly two-thirds of that total. She also pointed out that evolving decarbonisation policies could help secure a premium price for lower carbon ammonia.
“The transaction will generate returns exceeding our capital allocation framework targets, with phase 1 of the project expected to be free cash flow accretive by 2026. It also represents a material step towards meeting our Scope 3 investment and abatement targets,” O’Neill added.
The Texas-based project is currently under construction, with the first ammonia production targeted for 2025 and lower carbon ammonia production anticipated from 2026. OCI will continue to manage the construction phase through to provisional acceptance.
The total cash consideration for the acquisition is approximately $2.35 billion, inclusive of capital expenditure required to complete the first phase of the project. Woodside has already paid 80 percent of this amount, with the remaining 20% to be settled upon project completion.
For more information visit www.woodside.com
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