- Covestro, Fertiglobe, and TA’ZIZ signed an MoU to explore ammonia and nitric acid value chains.
- The MoU includes short-term ammonia supply to Covestro's sites in China and the US.
- Long-term plans involve low-carbon and green ammonia supply to Europe, China, and the US.
- Ammonia is crucial for Covestro's MDI and TDI production, used in polyurethane foams.
Memorandum of Understanding
Covestro, Fertiglobe, and TA’ZIZ have signed a Memorandum of Understanding (MoU) to explore collaboration in the ammonia and nitric acid value chains. This agreement aims to assess both immediate supply solutions and long-term opportunities for transitioning to lower-carbon production pathways.
Short and Long-term Supply Plans
Under the MoU, Covestro and Fertiglobe will explore short-term ammonia supply from Fertiglobe’s facilities to Covestro’s sites in China and the United States. They will also evaluate long-term supply options for sites in Europe, China, and the United States, focusing on low-carbon ammonia produced using carbon capture technologies and green ammonia from renewable sources.
Strategic Importance of Ammonia
Ammonia is a key raw material for Covestro's production of MDI (diphenylmethane diisocyanate) and TDI (toluene diisocyanate), which are essential components for polyurethane hard and soft foams. The potential strategic supply arrangement with Fertiglobe could enhance Covestro's access to this critical raw material while supporting a gradual transition to lower-carbon production.
Infrastructure and Global Opportunities
Beyond supply arrangements, the parties, including TA’ZIZ, will evaluate enabling infrastructure facilities such as storage and transport solutions. They will also explore potential business opportunities across the entire ammonia value chain, both globally and within the United Arab Emirates.
