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Japan's JERA signs ammonia supply MOUs with Yara, CF Industries

FILE PHOTO: The logo of JERA Co., Inc., the world's biggest LNG buyer, is displayed at the company office in Tokyo

(Reuters) - Japan's biggest power generator JERA signed ammonia supply memorandums of understanding (MOUs) with CF Industries of the United States and Norway's Yara Clean Ammonia Norge AS, as it aims to co-fire ammonia to reduce emissions, it said on Tuesday.

JERA plans to use a 20% ammonia fuel mix at all its coal-fired power plants by 2035, and to develop technology to use 100% ammonia in the 2040s, as Japan - among top CO2 emitters globally - targets carbon neutrality by 2050.

Under the MOUs, JERA agreed with Yara and separately with CF Industries to look at the possibility of buying up to 500,000 tonnes of clean ammonia per year for the 20% co-firing operations at the Hekinan Thermal Power Plant Unit 4 in Japan.

As part of the agreement, JERA and CF Industries, the world's top ammonia producer, would study 'potential supply options, including an equity investment alongside CF Industries to develop a greenfield clean ammonia facility in Louisiana, as well as a supplementary long-term offtake agreement from CF Industries' Donaldsonville Complex in Louisiana, the U.S. company said separately.

Yara and JERA also plan to collaborate on blue ammonia production in the U.S. Gulf and to produce more than 1 million tons per annum, according to a separate statement issued by Yara on Tuesday.

Tokyo hopes to use ammonia to gradually replace coal and develop a fully ammonia-fired power plant by 2050 but its reliance on coal and gas for power generation has grown since the 2011 Fukushima disaster, which left its nuclear power industry in crisis.

In 2021, JERA and IHI Corp began to use small volumes of ammonia along with coal at JERA's Hekinan coal-fired power station in central Japan as part of a demonstration project to reduce the facility's emissions of CO2.

(Reporting by Katya Golubkova; Editing by Alexandra Hudson)