Woodside Completes OCI Clean Ammonia Acquisition
Woodside has completed the acquisition of OCI Clean Ammonia Holding B.V., which holds a 1.1 Mtpa Clean Ammonia Project in Texas. The all-cash transaction, valued at approximately $2,350 million, positions Woodside as an early mover in the growing lower carbon ammonia market. The Project, currently under construction, aims to produce first ammonia by 2025 and lower carbon ammonia by 2026.
Key highlights:
- The Project will generate ammonia with less than 35% of the lifecycle emissions intensity of unabated ammonia
- Global ammonia demand is forecast to double by 2050, with lower carbon ammonia expected to make up nearly two-thirds of total demand
- The acquisition is expected to be free cash flow accretive from 2026
- It represents a significant step towards Woodside's Scope 3 investment and abatement targets
Woodside ha completato l'acquisizione di OCI Clean Ammonia Holding B.V., che possiede un progetto di ammoniaca pulita da 1,1 Mtpa in Texas. La transazione interamente in contante, valutata circa $2.350 milioni, posiziona Woodside come un precursore nel crescente mercato dell'ammoniaca a basse emissioni di carbonio. Il progetto, attualmente in fase di costruzione, mira a produrre la prima ammoniaca entro il 2025 e ammoniaca a basse emissioni di carbonio entro il 2026.
Punti salienti:
- Il progetto genererà ammoniaca con meno del 35% dell'intensità delle emissioni nel ciclo di vita dell'ammoniaca non mitigata
- Si prevede che la domanda globale di ammoniaca raddoppi entro il 2050, con l'ammoniaca a basse emissioni di carbonio che dovrebbe costituire quasi i due terzi della domanda totale
- L'acquisizione è destinata a essere accretiva per il flusso di cassa libero a partire dal 2026
- Rappresenta un passo significativo verso gli obiettivi di investimento e riduzione delle emissioni Scope 3 di Woodside
Woodside ha completado la adquisición de OCI Clean Ammonia Holding B.V., que posee un proyecto de amoníaco limpio de 1,1 Mtpa en Texas. La transacción, que es en efectivo y está valorada en aproximadamente $2,350 millones, posiciona a Woodside como un pionero en el creciente mercado de amoníaco de bajas emisiones de carbono. El proyecto, actualmente en construcción, tiene como objetivo producir amoníaco por primera vez para 2025 y amoníaco de bajas emisiones de carbono para 2026.
Puntos clave:
- El proyecto generará amoníaco con menos del 35% de la intensidad de emisiones del ciclo de vida del amoníaco no tratado
- Se prevé que la demanda global de amoníaco se duplica para 2050, con el amoníaco de bajas emisiones de carbono que se espera represente casi dos tercios de la demanda total
- Se espera que la adquisición sea acumulativa de flujo de caja libre a partir de 2026
- Representa un paso significativo hacia los objetivos de inversión y reducción de emisiones de alcance 3 de Woodside
우드사이드가 OCI 클린 암모니아 홀딩 B.V.를 인수하였습니다. 이 회사는 텍사스에 연간 1.1Mt의 클린 암모니아 프로젝트를 보유하고 있습니다. 현금 전액 거래로 약 23억 5천만 달러로 평가되는 이 프로젝트는 우드사이드를 증가하는 저탄소 암모니아 시장의 초기 진출자로 만듭니다. 현재 건설 중인 이 프로젝트는 2025년까지 첫 암모니아를 생산하고 2026년까지 저탄소 암모니아를 생산할 계획입니다.
주요 하이라이트:
- 이 프로젝트는 비탄소 암모니아의 생애 주기 배출 강도의 35% 미만의 암모니아를 생산합니다.
- 전세계 암모니아 수요는 2050년까지 두 배로 증가할 것으로 예상되며, 저탄소 암모니아가 전체 수요의 거의 3분의 2를 차지할 것으로 예상됩니다.
- 이번 인수는 2026년부터 자유현금흐름에 긍정적인 영향을 미칠 것으로 예상됩니다.
- 이는 우드사이드의 스코프 3 투자 및 배출 감축 목표를 향한 중요한 단계입니다.
Woodside a achevé l'acquisition d'OCI Clean Ammonia Holding B.V., qui détient un projet d'ammoniaque propre de 1,1 Mtpa au Texas. La transaction entièrement en espèces, évaluée à environ 2,35 milliards de dollars, positionne Woodside comme un initiateur sur le marché en pleine croissance de l'ammoniaque à faibles émissions de carbone. Le projet, actuellement en construction, vise à produire la première ammoniaque d'ici 2025 et de l'ammoniaque à faibles émissions de carbone d'ici 2026.
Points clés :
- Le projet générera de l'ammoniaque avec moins de 35 % de l'intensité des émissions sur le cycle de vie de l'ammoniaque non traitée
- La demande mondiale d'ammoniaque devrait doubler d'ici 2050, l'ammoniaque à faibles émissions de carbone devant représenter près des deux tiers de la demande totale
- L'acquisition devrait être accrétive pour le flux de trésorerie libre à partir de 2026
- Cela représente une étape importante vers les objectifs d'investissement et de réduction des émissions de portée 3 de Woodside
Woodside hat die Übernahme von OCI Clean Ammonia Holding B.V. abgeschlossen, die ein 1,1 Mtpa Clean Ammonia Project in Texas besitzt. Die vollständig in bar abgewickelte Transaktion, die mit ca. 2,35 Milliarden US-Dollar bewertet wird, positioniert Woodside als Vorreiter im wachsenden Markt für kohlenstoffarme Ammoniakproduktion. Das Projekt, das sich derzeit im Bau befindet, zielt darauf ab, im Jahr 2025 die erste Ammoniakproduktion und im Jahr 2026 kohlenstoffarmen Ammoniak zu produzieren.
Wichtigste Highlights:
- Das Projekt wird Ammoniak mit weniger als 35% der Lebenszyklus-Emissionsintensität von unabgeschwächtem Ammoniak erzeugen.
- Die weltweite Ammoniaknachfrage wird bis 2050 voraussichtlich doppelt so hoch sein, wobei der kohlenstoffarme Ammoniak voraussichtlich fast zwei Drittel der Gesamtnachfrage ausmachen wird.
- Die Übernahme wird voraussichtlich ab 2026 einen positiven Beitrag zum freien Cashflow leisten.
- Sie stellt einen bedeutenden Schritt in Richtung der Investitions- und Emissionsminderungsziele der Scope 3 von Woodside dar.
- Acquisition of 1.1 Mtpa Clean Ammonia Project in Texas
- Project expected to be free cash flow accretive from 2026
- Positions Woodside as early mover in growing lower carbon ammonia market
- Ammonia production with less than 35% lifecycle emissions intensity of unabated ammonia
- Aligns with Woodside's Scope 3 investment and abatement targets
- Significant upfront cash investment of $2,350 million
- Project still under construction, with production targets in 2025-2026
- Lower carbon ammonia production conditional on external factors (carbon abated hydrogen supply and ExxonMobil's CCS facility)
Insights
Woodside's
Key financial aspects:
- All-cash deal structure, with
80% paid upfront and20% at project completion - Returns expected to exceed Woodside's capital allocation framework targets
- Potential for premium pricing due to evolving decarbonization policies
While the
This acquisition marks a significant shift in Woodside's portfolio towards lower-carbon energy solutions. The 1.1 Mtpa Clean Ammonia Project, once operational with carbon capture and sequestration, will produce ammonia with less than
Key industry implications:
- Diversification into ammonia applications: power generation, marine fuels and industrial feedstock
- Potential to capture market share in the growing lower carbon ammonia sector
- Alignment with Woodside's Scope 3 investment and abatement targets
The project's success hinges on the timely completion of construction and the operational start of ExxonMobil's CCS facility. Investors should watch for any delays in these critical milestones, as they could impact the projected 2025-2026 production timeline and the realization of lower carbon ammonia benefits.
The completion follows Woodside’s announcement on 5 August 2024 that it had entered into an agreement to acquire OCI’s 1.1 Mtpa Clean Ammonia Project. Following start up of carbon capture and sequestration, the Project will generate ammonia with less than
Woodside CEO Meg O’Neill said the transaction positioned Woodside as an early mover in the growing lower carbon ammonia market.
“As a global energy provider, Woodside is focused on lower carbon ammonia and its increasingly important role in the world’s energy mix. The potential applications are in power generation, marine fuels and as an industrial feedstock, as it displaces higher-emitting fuels.
“Global ammonia demand is forecast to double by 2050 with lower carbon ammonia making up nearly two-thirds of total demand. Evolving decarbonisation policies have potential to attract a premium price for lower carbon ammonia.3
“The transaction will generate returns exceeding our capital allocation framework targets, with phase 1 of the Project expected to be free cash flow accretive from 2026. It also represents a material step towards delivering our Scope 3 investment and abatement targets.”4
The Project remains under construction and is targeting production of first ammonia from 2025 and lower carbon ammonia from 2026.5 OCI will manage the construction of the Project through provisional acceptance.
The all-cash consideration of approximately
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1 See disclaimer for information on “lower carbon ammonia”. |
2 EU proposed standards calculation method for carbon intensity. |
3 Source: Wood Mackenzie Global Ammonia Strategic Planning Outlook 2024, published 31 May 2024. |
4 For more information on this transaction and Woodside’s Scope 3 targets, please refer to the announcement titled ‘Woodside to acquire OCI's Clean Ammonia Project’, released 5 August 2024. |
5 Production of lower carbon ammonia is conditional on supply of carbon abated hydrogen and ExxonMobil’s CCS facility becoming operational. |
This announcement was approved and authorised for release by Woodside’s Disclosure Committee. |
Definitions
Woodside uses “lower carbon” to describe the characteristic of having lower levels of associated potential greenhouse gas (GHG) emissions when compared to historical and/or current conventions or analogues, for example relating to an otherwise similar resource, process, production facility, product or service, or activity.
Forward-looking statements
This announcement contains forward-looking statements with respect to Woodside's business and operations, market conditions, results of operations and financial condition, including, for example, but not limited to, statements regarding the transaction, the timing of completion of other transactions, the timing of completion of Woodside's projects and expectations regarding future expenditures and future results of projects. All statements, other than statements of historical or present facts, are forward-looking statements and generally may be identified by the use of forward-looking words such as 'guidance', 'foresee', 'likely', 'potential', 'anticipate', 'believe', 'aim', ‘aspire’, 'estimate', 'expect', 'intend', 'may', 'target', 'plan', 'forecast', ‘outlook’, 'project', 'schedule', 'will', 'should', 'seek' and other similar words or expressions. Similarly, statements that describe the objectives, plans, goals or expectations of Woodside are forward-looking statements.
Forward-looking statements in this announcement are not guidance, forecasts, guarantees or predictions of future events or performance, but are in the nature of future expectations that are based on management’s current expectations and assumptions. Those statements and any assumptions on which they are based are subject to change without notice and are subject to inherent known and unknown risks, uncertainties, assumptions and other factors, many of which are beyond the control of Woodside, its related bodies corporate and their respective officers, directors, employees, advisers or representatives. If any of the assumptions on which a forward-looking statement is based were to change or be found to be incorrect, this would likely cause outcomes to differ from the statements made in this announcement.
A detailed summary of the key risks relating to Woodside and its business can be found in the "Risk" section of Woodside's most recent Annual Report released to the Australian Securities Exchange and the London Stock Exchange and in Woodside's most recent Annual Report on Form 20-F filed with the United States Securities and Exchange Commission and available on the Woodside website at https://www.woodside.com/investors/reports-investor-briefings. You should review and have regard to these risks when considering the information contained in this announcement.
All information included in this announcement, including any forward-looking statements, reflects Woodside’s views held as at the date of this announcement and, except as required by law or regulation, neither Woodside, its related bodies corporate, nor any of their respective officers, directors, employees, advisers or representatives intends to, undertakes to, or assumes any obligation to, provide any additional information or update or revise any information or forward-looking statements in this announcement after the date of this announcement, either to make them conform to actual results or as a result of new information, future events, changes in Woodside’s expectations or otherwise.
Investors are strongly cautioned not to place undue reliance on any forward-looking statements. Actual results or performance may vary materially from those expressed in, or implied by, any forward-looking statements.
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INVESTORS
Marcela Louzada
M: +61 456 994 243
E: investor@woodside.com
MEDIA
Christine Forster
M: +61 484 112 469
E: christine.forster@woodside.com
Source: Woodside Energy Group Ltd
FAQ
What is the value of Woodside's acquisition of OCI Clean Ammonia Project?
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