Pupuk Indonesia to collaborate with Toyo/Itochu on green ammonia project

As a strategic step towards achieving sustainable growth, PT Pupuk Indonesia (Persero) will develop what it says is the world’s first hybrid green ammonia project. The development of this project is being carried out in collaboration with two Japanese corporations, Itochu Corporation and Toyo Engineering Corporation.

Pupuk Indonesia’s President Director, Rahmad Pribadi, explained that this collaboration between the three companies will be a significant step in promoting industrialisation within the country, particularly in the development of green ammonia, which is expected to have a positive impact on the national economy.

“In Project GAIA, Pupuk Indonesia will produce green ammonia using an ammonia plant with a process technology designed and built by Toyo in the 2000s. This green ammonia will then be supplied to Itochu as a raw material for marine fuel, thereby forming a comprehensive value chain, making it the first of its kind in Indonesia and the world,” he explained.

The goal of Project GAIA is to produce green ammonia at the PIM-2 fertilizer plant owned by Pupuk Iskandar Muda, located in the Arun Lhokseumawe Special Economic Zone (SEZ) in Aceh. The production of green ammonia will be supported by the installation of an electrolyser at the fertiliser plant.

This electrolyser technology functions to extract hydrogen from water compounds, using renewable energy sources for the electrolysis process. The hydrogen produced in this process is then reacted with nitrogen to produce ammonia. This process leaves no carbon footprint, thus it is referred to as green ammonia.

This initiative will also be expanded to other ammonia plants under the Pupuk Indonesia Group and to ammonia plants in other countries in the future. Furthermore, the project has been selected by Japan’s Ministry of Economy, Trade, and Industry (METI) as one of the projects under the Global South Future-Oriented Co-Creation Business Expense Subsidy. This program provides subsidies to 13 future-oriented projects in ASEAN.

The initial development phase, namely the Front-End Engineering Design (FEED) of Project GAIA, started in August 2024. Simultaneously, Pupuk Indonesia, Itochu, and Toyo will establish a joint venture company, with the final investment decision (FID) expected to be reached in the first half of 2025, and commercial operations targeted for 2027.

In the same series of events, Pupuk Kujang also signed a Memorandum of Understanding (MoU) with PLN Indonesia Power and IHI Corporation (IHI) concerning collaboration on green ammonia studies and the implementation of ammonia co-firing demonstrations. This collaboration is expected to identify the best operational methods for producing green ammonia and reducing emissions at coal-fired power plants.

In this collaboration, Pupuk Kujang will supply green ammonia to be used in the co-firing process at PLN’s Labuan power plant located in Banten, West Java. Meanwhile, IHI will install an electrolyser at the Labuan power plant to be sent to Pupuk Kujang and install a special burner for the co-firing process at the Labuan power plant.

“With over 50 years of experience in the production, storage, and distribution of ammonia, Pupuk Indonesia is the right strategic partner to further develop green ammonia production in Indonesia. This collaboration is one form of business diversification by Pupuk Indonesia, which not only supports food security but also promotes industrial downstreaming and adds value to the national economy, as well as supports the government’s target of achieving Net Zero Emissions by 2060,” concluded Rahmad.