📚 Ammonia Advances (and so does Booker’s)

Good Morning. This is the Sunya Scoop. The newsletter that takes energy transition news and turns it into an easy-to-read email for you.

Today’s edition was started on a laptop that survived an airplane recliner.

Here’s what we have for you today:

• Championship: Bourbon Madness continues

• Enbridge teams up with Yara to develop $3 billion blue ammonia facility

• CNX and Adams Fork Energy to advance low-carbon ammonia in West Virginia

• Financing crunch for US LNG project developers

• Freeport update – getting back to full capacity

• Hess donating $50 million to Salk Institute Harnessing Plants Initiative (HPI)

• Buckeye forms energy transition infrastructure company

• EQT teams up with Context Labs on carbon credits

• Visual of the week – SPR inventory

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BOURBON MADNESS

Continuing Bourbon Madness, as a reminder:

• We’ve selected an Elite Eight of the finest bourbons in the world and pitted them against each other in a bracket-style tournament that will leave your taste buds begging for more.

• Cast your votes, sip your favorites, and let’s see which one comes out on top. It’s Bourbon Madness, and it’s time to get sippin’!

You’ll be entered to win the winning bottle if:

1. you vote in all polls in all 3 brackets – Elite Eight (last Tuesday’s edition), Final Four (last Thursday’s edition), Championship (today’s edition)

2. you have completed the Gentleman’s Agreement (or Lady’s Choice). If you haven’t seen it, scroll down to the “Share Sunya Scoop” section towards the end of this newsletter

Here were results from your votes for the Championship contenders

Cast your votes for champion!

The winning bottle of Bourbon Madness 2023 will be announced in Thursday (4/6)’s edition.

Don’t forget to complete the Gentlemen’s Agreement (Lady’s Choice)! Scroll down to “Share Sunya Scoop”

LOW-CARBON FUELS

Enbridge teams up with Yara to develop $3 billion blue ammonia facility

• Yara and Enbridge have signed an LOI to develop a low-carbon blue ammonia production facility at the Enbridge Ingleside Energy Center in Texas, the largest crude storage and export facility in the US

• The facility has an expected capacity of 1.2-1.4 million tons per annum, supplying low-carbon ammonia to meet growing global demand.

• Approximately 95% of the carbon dioxide generated from the production process is expected to be captured and sequestered.

• Total project investment is expected to be in the range of US$2.6-US$2.9 billion, with production start-up in 2027/2028.

• Enbridge’s Texas Eastern Transmission Pipeline is expected to provide the transportation service for feed gas, and Enbridge, along with Oxy Low Carbon Ventures, is advancing a nearby CO2 sequestration hub which is a potential destination for the project’s captured CO2.

• Yara is expected to contract full offtake from the facility

LOW-CARBON FUELS

CNX and Adams Fork Energy (TransGas Development) to advance low-carbon ammonia in West Virginia

• Adams Fork Energy (TransGas Development), CNX Resources, and other partners announced the advancement of a multi-billion-dollar clean ammonia production facility in Mingo County, West Virginia

• The project is expected to have initial annual ammonia production capacity of 2,160,000 metric tons, with optional additional production capacity, and is located on a reclaimed coal mining site.

• CNX will provide fuel and carbon sequestration services to the project, and it is expected to support 2,000 well-paying construction jobs and generate significant tax revenues and capital investment for underserved Mingo County.

• The project is an anchor project in the Appalachian Regional Clean Hydrogen Hub’s application to the U.S. Department of Energy, with the region being the ideal location for a clean hydrogen hub due to its unique access to low-cost natural gas feedstock, end-user demand, workforce, and technology capability.

• Ammonia has been identified as one of the most efficient hydrogen carriers and also results in zero carbon emissions when combusted.

• Haldor Topsoe will furnish clean ammonia production technology for the state-of-the-art Adams Fork facility.

• The project has received significant federal, state, and local bipartisan support and is expected to displace more than 2.7 million metric tons per year of CO2 equivalent.

LNG

Financing crunch for US LNG project developers

• Financial hurdles are rising for U.S. liquefied natural gas (LNG) project developers

• Rising interest rates and supply chain shortages are affecting multi-billion-dollar projects

• Two of four new projects aiming for approval this quarter have been delayed, others may face a higher bar

• Venture Global LNG’s project in Louisiana and Sempra Energy’s in Texas won approvals with strong corporate financing

• Both projects have less reliance on developer’s equity and more on fully contracted capacity

• About 90% of production capacity for both projects is under long-term deals, addressing volatile gas-price risk

• The proposed NextDecade and Energy Transfer LP export terminals have been repeatedly delayed due to rising costs

• Soaring inflation means LNG exporters need to recover their costs via higher liquefaction fees, which is a harder sell now with gas prices collapsing

LNG

Freeport update – getting back to full capacity

• Natural gas flows to Freeport LNG’s export plant in Texas are on track to hit their highest since shutting down in June 2022

• Freeport LNG has been slowly increasing feedgas since exiting an eight-month outage in February

• Gas flows to the plant are on track to rise to 1.8 billion cubic feet per day on Wednesday, up from 1.6 bcfd on Tuesday

• Energy traders suggest the increase signals the start of the third of three liquefaction trains at the plant

• When operating at full power, Freeport LNG can turn about 2.1 bcfd of gas into LNG

• Demand for U.S. LNG increased after several countries slowed purchases of Russian energy and imposed sanctions on Moscow after Russia’s invasion of Ukraine in February 2022

• Total gas flows to all seven big U.S. LNG export plants rose to an average of 13.1 bcfd so far in March, up from 12.8 bcfd in February, and could top the monthly record of 12.9 bcfd in March 2022 before the Freeport LNG shutdown.

CARBON MARKETS

Hess donating $50 million to Salk Institute Harnessing Plants Initiative (HPI)

• Hess Corporation has announced a $50 million donation over the next five years to the Salk Institute’s Harnessing Plants Initiative (HPI) to combat climate change.

• The donation will support HPI’s work, including faculty recruitment, laboratory and research operations, and establishing the new Hess Center for Plant Science.

• This is Hess Corporation’s third donation to HPI; in 2020, it donated $12.5 million, and in 2021, $3 million to establish the endowed Hess Chair in Plant Science at Salk.

• The initiative aims to develop plants’ natural ability to capture and store carbon from the atmosphere, and researchers have made advances in enhancing desired plant traits such as deeper rooting and the ability to sequester carbon.

• The prospects of this approach in combatting climate change on a global scale are exciting, and the donation will accelerate the work being done by the group of talented plant scientists at Salk.

ENERGY TRANSITION

Buckeye forms energy transition co, BAES Infrastructure

• Buckeye Partners is launching BAES Infrastructure, focused on developing, constructing and operating new energy transition projects

• Seed assets of BAES Infrastructure include Swift Current Energy (renewables), OneH2 (hydrogen), Bear Head Energy (low carbon hydrogen and ammonia in Nova Scotia), a hydrogen and ammonia project under development in South Texas, and other solar projects.

• The company aims to invest and develop activity in the energy transition space while continuing to safely and reliably operate Buckeye’s petroleum products infrastructure

• Jamie Cemm, former Chair of Buckeye’s Board of Directors, will lead BAES Infrastructure as CEO with a global team of specialized professionals

CARBON MARKETS

EQT teams up with Context Labs on low carbon gas products and carbon credits

• EQT and Context Labs have established a strategic partnership to commercialize verified low carbon intensity natural gas products and carbon credits.

• Context Labs will provide an enterprise-wide deployment of their Decarbonization-as-a-Service (DaaS™) platform across EQT’s asset footprint.

• The partnership will support EQT in achieving its industry-leading emissions reduction targets, including reaching net zero greenhouse gas (GHG) emissions by 2025.

• The companies will work to scale emissions mitigation across the full energy value chain through emissions quantification, operational analysis, and certification of natural gas production.

• Context Labs’ DaaS™ platform will enable certification and verification of the carbon intensity of EQT’s operating assets, with certificates registered in Context Labs’ CLEAR Path™ Repository.

• EQT will have the opportunity to integrate carbon credit projects into CLEAR Path™ in support of generating asset-grade, data-backed carbon credits.

• The partnership aims to comprehensively verify environmental data and ensure natural gas plays a leading role in the world’s energy evolution.

Visual of the week (from Twitter)

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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.