S-Oil partners with Aramco to import low-carbon ammonia

S-Oil has signed a letter of intent with Aramco to procure low-carbon ammonia. [S-OIL]

S-Oil has signed a letter of intent (LOI) with Aramco, a Saudi Arabian energy and chemicals giant, to procure low-carbon ammonia, building on the MOU signed last year to establish hydrogen supply networks.

The LOI outlines the plan for the supply and utilization of low-carbon ammonia produced in Saudi Arabia and imported into Korea.

Low-carbon ammonia refers to ammonia that is produced with less carbon dioxide emissions in the manufacturing process, and is deemed important for environmental sustainability as the conventional method is highly energy-intensive. A type of gas, ammonia is mostly used in making fertilizers, but is also used as a raw material for a large number of basic chemicals, and can also be applied as fuel.

Aramco will produce low-carbon ammonia, applying carbon capture and storage technology. S-Oil intends to import this ammonia, convert it into hydrogen, and use it for its own efforts to reduce greenhouse gas emissions and for related business development, according to S-Oil’s press release on Tuesday.

The Korean petroleum company plans to use this LOI with Aramco as a foundation to strengthen infrastructure development for the domestic introduction of low-carbon ammonia, and related demand and business development activities in the future.

“We support S-Oil’s efforts to reduce greenhouse gas emissions and the establishment of the domestic hydrogen industry by introducing low-carbon ammonia to the domestic market,” said Dr. Ryu Yul, head of S-Oil’s Corporate Strategy and Services.

BY KIM JU-YEON [kim.juyeon2@joongang.co.kr]