Orsted and Maersk sign landmark green fuels agreement

Integrated container logistics company A.P. Moller – Maersk and Orsted, a world leader in renewable energy, on Friday announced they had signed a letter of intent (LOI) about partnering on a new Power-to-X facility in the US, which can become a landmark project in the green transformation of international deep-water shipping.

The project will set the standard for future large-scale production of green maritime fuels, the companies said in a statement.

On the US Gulf Coast, Orsted will develop a 675 MW Power-to-X facility that will produce approx. 300,000 tonnes of e-methanol per year, which Maersk will offtake for its newly ordered fleet of 12 methanol-powered vessels, the companies said.

The facility will be powered by approx. 1.2GW of renewable energy from new onshore wind and solar PV farms. The biogenic carbon needed to produce e-methanol will be extracted through carbon capture at one or more large point sources.

The project is targeted to be commissioned in the second half of 2025, and final investment decision could be made in late 2023.

“We commend Maersk’s clear and ambitious action, which has made the company a leader in the difficult task of reducing the climate impact of the maritime industry. Partnerships with large offtakers of green fuels, like Maersk, is an important part of Orsted’s strategic journey, as we broaden our Power-to-X footprint across the world to become a global leader in renewable hydrogen and green fuels,” Martin Neubert, Deputy CEO and Chief Commercial Officer at Orsted, said in a statement.

Over the past two decades, greenhouse gas emissions from the global maritime industry have risen sharply to account for around 2 percent of global energy-related emissions.

The 300,000 tonnes of e-methanol in the project are the largest potential offtake agreement for green fuels in the maritime industry ever announced.

“To transition towards decarbonisation, we need a significant and timely acceleration in the production of green fuels. Green methanol is the only market-ready and scalable available solution today for shipping… That is why these partnerships mark an important milestone to get the transition to green energy underway,” Henriette Hallberg Thygesen, CEO of Fleet & Strategic Brands, A.P. Moller – Maersk, said.