Cepsa and Yara Clean Ammonia Seal an Alliance to Connect Southern and Northern Europe with Green Hydrogen, in the Presence of the Kings of Spain and The Netherlands

June 16, 2023

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(Cepsa) ◊ The two companies have agreed on a strategic partnership to set up the first green hydrogen maritime corridor between the ports of Algeciras and Rotterdam for the decarbonization of European industry and maritime transport

- The alliance incorporates Yara Clean Ammonia as the newest partner of the Andalusian Green Hydrogen Valley, where Cepsa plans to build a new green ammonia plant at its energy park in San Roque, Cádiz, near the port of Algeciras, with a 1-billion-euro investment and the creation of 3,300 jobs. It will be the largest green ammonia project in Europe with an annual production capacity of up to 750,000 tons, which will prevent up to 3 million tons of CO₂ from being emitted
- The partnership also envisages Yara Clean Ammonia supplying Cepsa with green ammonia volumes, which will allow the energy company to get a head start in establishing the green hydrogen corridor and lead the initiative to serve industrial and marine customers in Rotterdam and Central Europe
- Cepsa also signed an agreement with Dutch company Gasunie that guarantees access to its green hydrogen transport network in the Netherlands, which will connect the Port of Rotterdam with other European industrial clusters in Germany, the Netherlands, and Belgium as part of the Delta Corridor project
- The above agreements will consolidate the development of the Andalusian Green Hydrogen Valley, the largest green hydrogen project in Europe with 2 GW of electrolysis capacity and an overall investment of 3 billion euros
- Their Majesties King Felipe VI and King Willem-Alexander witnessed the signing ceremony, underlining the collaboration between the two countries to accelerate the net-zero carbon energy transition and achieve energy independence for Europe

Their Majesties the King of Spain, Felipe VI, and the King of the Netherlands, Willem- Alexander, today witnessed the signing of a commercial partnership agreement between Cepsa and the Norwegian multinational Yara Clean Ammonia, a global leader in the field of clean ammonia, under which the two companies will set up the first green hydrogen maritime corridor between southern and northern Europe, connecting the ports of Algeciras and Rotterdam as part of efforts to boost decarbonize industry and maritime transport on the continent.

As part of the Andalusian Green Hydrogen Valley, Cepsa will develop a green ammonia plant at its San Roque Energy Park in Cadiz that will be operational in 2027. With an investment of 1 billion euros, it will be the largest plant in Spain and one of the largest in Europe. The project, which could include potential partners, will create 3,300 jobs – including direct, indirect and induced – and a new market in Algeciras for green ammonia, a product derived from green hydrogen that can be used both as a sustainable marine fuel and as a carrier of green hydrogen for its transportation to distant locations.

The alliance with Yara Clean Ammonia will help establish a safe, resilient, and cost-efficient supply chain for delivering green ammonia and paves the way for Cepsa to deliver the first green hydrogen molecules to its customers by using Yara Clean Ammonia’s global supply base and logistical footprint. This will in turn allow the energy company to start marketing green hydrogen and green ammonia to industrial customers and maritime customers in Rotterdam and Central Europe.

The event was also attended by the Third Vice President and Minister for Ecological Transition and Demographic Challenge, Teresa Ribera, the Minister for Climate and Energy Policy of the Netherlands, Rob Jetten, the President of the Junta de Andalucía, Juan Manuel Moreno Bonilla, the President of the Port of Algeciras, Gerardo Landaluce, and the Director of the Port of Rotterdam International, René van der Plas, among other authorities.

The new green ammonia plant will be powered by green hydrogen produced by Cepsa and EDP at the 1 GW plant to be developed in Campo de Gibraltar. It will have an annual production capacity of up to 750,000 tons of ammonia, which can prevent 3 million tons of CO₂ emissions. Yara, a global leader in ammonia production, has extensive experience in this market, which will ensure the development of a viable green energy corridor in Europe. Cepsa will offer its extensive experience in producing fuels and its knowledge of the maritime sector to support its customers' decarbonization strategy.

Yara Clean Ammonia is part of Yara International, which has its largest ammonia and fertilizer plant in the Netherlands. Since 1929, the Dutch Yara site is located in Sluiskil on the Ghent-Terneuzen canal, a major deep-sea waterway opening into the North Sea and connecting European inland rivers and railway all over Europe. This largest fertilizer production site in western Europe is highly integrated and belongs to the top of most efficient plants on world level.

At the same ceremony, in the presence of Their Majesties, Cepsa also signed an agreement with Hynetwork Services, the Gasunie subsidiary that owns the green hydrogen transport network in the Netherlands. With this agreement, Cepsa’s green hydrogen receives access to that network which, additionally, will connect the Port of Rotterdam with other European industrial clusters in Germany, the Netherlands and Belgium as part the Delta Corridor project.

Maarten Wetselaar, Cepsa's CEO, said: "Today’s agreements are a crucial step towards the long-term viability of the Andalusian Green Hydrogen Valley and the implementation of the first maritime corridor of sustainable fuels that will link the South with the North of Europe. Green hydrogen and its derivatives are the fastest, most viable and competitive solution to accelerate the energy transition in heavy transport and ensure energy independence in Europe. The agreements announced today give our project crucial access to markets, customers and distribution infrastructure: three key elements to unlock the potential of our Hydrogen valley. This is major news for the decarbonization of European shipping and industry and for the planet.”

Magnus Ankarstrand, President of Yara Clean Ammonia, said: "Yara Clean Ammonia and Cepsa have forged a pioneering partnership to establish a credible and robust supply chain for clean energy transformation in Europe. This partnership will lay a solid foundation for industrial efforts to secure clean ammonia and hydrogen for several downstream applications in Europe while securing the clean transformation goals. We are delighted to be a part of this collaborative initiative.”

Helmie Botter, manager of hydrogen business development at Gasunie, said: "With this agreement, we are strengthening the hydrogen corridor between Spain and the Netherlands. Through the logistics import hubs, such as the Port of Rotterdam, and the nationwide hydrogen network of Gasunie subsidiary Hynetwork Services to bring the green hydrogen to European industrial users, the Netherlands is positioning itself to become the gateway for Northwest Europe with hydrogen.”

The partnerships represent a new step in the development of the Andalusian Green Hydrogen Valley, the largest project presented in Europe, with a capacity of 2 GW to produce 300,000 tons of green hydrogen. In addition, it enables the development of a hydrogen value chain, promoting the decarbonization of industry in Andalusia and the development of a new sustainable marine fuels industry with the capacity to export to the rest of Europe.

With this commercial cooperation agreement, Cepsa will have greater capacity to supply hydrogen and green ammonia to its customers in Northern Europe. The Spanish energy company has an agreement with ACE Terminal (a consortium of the companies Gasunie, HES International, and Vopak) to distribute green ammonia to the planned import terminal in the Port of Rotterdam, for final use in industry after converting the ammonia back into green hydrogen, or for direct use. In addition, on May 10, Cepsa announced a collaborative agreement with GETEC to supply it with green hydrogen and its derivatives, which GETEC will distribute to industrial customers in different European countries. The company provides heating, cooling and electrical services to industrial customers in various sectors (chemical, automotive, food, pharmaceutical, polymer and paper industries) in Germany, the Netherlands, Switzerland and Italy. READ MORE

Ammonia, a sustainable solution as shipping fuel and for hydrogen transport

Green ammonia is one of the most effective alternatives for decarbonizing maritime transport. As of 2026, shipping companies are expected to expand the use of this sustainable fuel to reduce CO₂ emissions by 100%. Both its production, combining green hydrogen and nitrogen from the atmosphere, and its use as a fuel are carbon neutral.

In addition, it is easier and more sustainable to transport ammonia than hydrogen as it can be transported at a higher temperature (ammonia is transported at -33°C, while hydrogen needs to be cooled to -253°C). After being transported, the ammonia can be converted back into hydrogen for distribution as will be done in the Port of Rotterdam, where a terminal is being built to perform this conversion and channel the green hydrogen via pipelines to Germany, Belgium, Denmark, or the Netherlands.

This commitment to sustainable maritime fuels is in line with the European Commission's Fit for 55 package, which includes "FuelEU Maritime," a legislative initiative that aims to stimulate demand for sustainable alternative fuels in maritime transport to reduce greenhouse gas emission intensity by 2% in 2025, 6% in 2030, and 80% in 2050, compared to 2020 levels.

In addition, the development and use of sustainable fuels contributes to several of the 2030 Agenda’s Sustainable Development Goals: SDG 7 (Affordable and clean energy), SDG 8 (Decent work and economic growth), SDG 12 (Responsible consumption and production), and SDG 13 (Climate action).

By 2050, green hydrogen will account for one third of the fuel used in global land transport, 60% of maritime transport and will be instrumental in storing energy from a 100% renewable electricity system.

Iberdrola, together with ACE Terminal and Hynetwork Services, will develop the green hydrogen maritime corridor between Spain and the Netherlands -- The King of the Netherlands accompanied by Ignacio Galán visits the main green hydrogen production plant in Europe (Iberdrola)

Excerpt from Iberdrola:

The Executive Chairman of Iberdrola received the King of the Netherlands at the Puertollano green hydrogen plant on the day two agreements were signed between the company, ACE Terminal and Hynetwork Services
The agreements guarantee to enhance the logistics chain to decarbonize the industry of northern Europe

Iberdrola has taken a definitive step forward in the establishment of the green hydrogen maritime corridor between Spain and the Netherlands. The Executive Chairman of Iberdrola, Ignacio Galán, received His Majesty the King of the Netherlands today at the Puertollano plant on the day new agreements were signed between the company, ACE Terminal and Hynetwork Services.

Ignacio Galán, Executive Chairman of Iberdrola, said that "when we talk about green hydrogen, we are not talking about promises, we are talking about a reality and it demonstrates Iberdrola's commitment to new technologies and to our country, as we have been doing for many years. We remain firmly committed to the Single Energy Market as the best way to promote the huge investments needed if we want a secure, clean and competitive energy industry."

Mr Galán also added that "the current facilities in Puertollano are in a first phase and in the future we aim to multiply the capacity of the plant ten times. In addition, a few days ago, we also signed a contract to sell ammonia that we will produce in Huelva, more than 100,000 tons per year. We have planned investments in this sector of more than 3 billion euros, of which more than half will come to Spain"

Helmie Botter, Hydrogen Business Development Manager at Gasunie, said: "With this agreement we are strengthening the hydrogen corridor between Spain and the Netherlands. Through import logistics hubs, such as the Port of Rotterdam, and the national hydrogen network of Hynetwork Services, a subsidiary of Gasunie, to bring green hydrogen to European industrial users, the Netherlands is positioning itself to become the gateway for Northwest Europe with hydrogen."

The project partners, Walter Moone (President of New Energies & LNG Vopak); Cees van Gent (CEO of HES International) and Ulco Vermeulen (Executive Board of Gasunie) attended the signing of the agreement and expressed their satisfaction that Iberdrola has chosen its terminal to receive, store and distribute green ammonia and to transport green hydrogen. Together with Iberdrola, ACE Terminal takes a significant step in the establishment of the hydrogen value chain between Spain and the Netherlands.

Thanks to the agreements signed today, plans to develop a maritime corridor between Spain and the Netherlands are one step closer. Iberdrola aims to transport green ammonia to ACE Terminal's import facilities in the Port of Rotterdam, to handle and store, and convert ammonia into green hydrogen, for end use in industry, or for direct use in shipping and other industries in northwestern Europe.

Transport and distribution will be carried out through the Dutch national hydrogen network of Gasunie's subsidiary Hynetwork Services in the European market to customers in the chemical, steel, refining and fertilizer industries. These entities are established in clusters such as those in Rotterdam, Amsterdam, Zeeland and Chemelot in the Netherlands and in northwestern Europe.

With His Mastestad King Willem-Alexander as a distinguished witness, the alliances established mark an important step forward in the materialization of the agreement between Spain and the Netherlands. The objective is to establish the maritime corridor of green hydrogen between both countries as soon as possible that will help to decarbonize the industry of northern Europe. The maritime transport of competitive green hydrogen, which Iberdrola is already producing in Spain, is a key lever for this transformation to occur in the short term.

In addition to His Majesty the King of the Netherlands, the Minister of Climate and Energy Policy of the Netherlands, Robert Jetten; the Secretary of State for Energy, Sara Aagesen, Roel Nieuwenkamp, Ambassador of the Netherlands to Spain and Consuelo Fermenía Guardiola, Ambassador of Spain to the Netherlands, also attended.

The Puertollano plant has received more than 180 visits from governments, entrepreneurs and universities around the world. Among them, His Majesty the King of Spain during his inauguration, the Ministers of Energy of Australia, Chile and Slovenia, the Secretary of Environment of Brazil, the embassies of Turkey or Holland, or the Government delegations of Japan, Morocco, Colombia or Finland, as well as Chambers of Commerce from different countries.

Last December, Iberdrola reached an agreement with the Port of Rotterdam to export green hydrogen and its derivatives to the Netherlands. This new step represents a step forward in its commitment to promote the decarbonisation of industrial consumers in northern Europe.

INDUSTRIAL DECARBONISATION

The decarbonisation of industry in northern Europe is a challenge for the coming years in which Iberdrola wants to be central to, delivering real projects supplying green hydrogen to its customers. The company was the first to produce green hydrogen and will be the first to begin its export.

Spain has great renewables potential that will allow it to decarbonize its local industry. In addition, it has additional resources of competitive renewable energy to supply its European partners and contribute to building a greener and more connected Europe, guaranteeing its energy security and independence.

For this reason, Iberdrola, in its commitment to lead decarbonisation, is promoting, together with key players in the Dutch energy ecosystem, the joint development of the logistics chain necessary to make the green hydrogen corridor a reality.

LEADER IN RENEWABLE ENERGY

The Iberdrola group has been investing significantly in renewable energy for more than two decades, as a core pillar to build its clean, reliable and smart business model. Thanks to this vision, the company is a world leader in renewable energy, with 40,344 MW of renewables capcity at the end of the first quarter of 2023.

Committed to the energy transition towards a low-emission economy, the company is now a leader in the green hydrogen revolution with three plants in operation by 2023. In total, there are 60 projects under development in eight countries to support decarbonisation in sectors such as heavy industry and transport.

Iberdrola's Puertollano plant, located in Ciudad Real, consists of a 100 MW photovoltaic solar plant. It has a lithium-ion battery system with a storage capacity of 20 MWh and the largest green hydrogen production system in Europe (20 MW). With an investment of 150 million euros, it will be able to produce up to 3,000 tons of green hydrogen per year, which would avoid the emission of 48,000 tons of CO2 per year.

ABOUT ACE TERMINAL

To facilitate the growing demand for hydrogen, three strategic partners: Gasunie, HES International and Vopak have joined forces and expertise to develop a hydrogen import terminal at the Port of Rotterdam. The "open access" terminal will enable the reception and storage of ammonia as a hydrogen carrier for customers in northwestern Europe. In addition, the terminal will provide the conversion of ammonia to hydrogen, the transhipment of ammonia and the subsequent transit of hydrogen and ammonia to end users.

The ACE Terminal will be built on the Maasvlakte in the Port of Rotterdam. The strategic location offers direct access from the North Sea and a connection to Rotterdam's industry and Gasunie's gas pipeline network to northwestern Europe. The terminal will utilize Gasunie's existing facilities, HES International's land and dock, and Vopak's ammonia storage know-how. The terminal is expected to be operational in 2026.

ABOUT HYNETWORK SERVICES

Hynetwork Services (a 100% subsidiary of N.V. Nederlandse Gasunie) is creating a national hydrogen network in the Netherlands that will link demand and supply ofCO2-free hydrogen. Five industrial groups will be connected to each other, to other countries and to hydrogen storage and import sites. This will be done mainly using existing infrastructure and partly using newly built infrastructure. Hydrogen Network Netherlands is being built in phases. The goal is to have the network completely completed by 2030. READ MORE