Japan’s Marubeni Corporation has signed a long-term offtake agreement for approximately 250,000 t/y of low-carbon ammonia from ExxonMobil’s petrochemical facility in Baytown, Texas, US. The ammonia will mainly be supplied to the Kobe power plant in Japan, to co-fire with existing fuel, reducing overall CO₂ emissions.  

Marubeni is also to acquire an unspecified equity stake in ExxonMobil’s low-carbon hydrogen and ammonia facility at Baytown, which is expected to be the world’s largest of its kind upon start-up. It will use natural gas as feedstock to produce up to 1bn cf/d of virtually carbon-free, blue hydrogen with approximately 98% of CO₂ captured, and more than 1mn t/y of low-carbon ammonia, according to ExxonMobil. A final investment decision is expected later this year with anticipated start-up in 2029, ‘subject to supportive government policy, regulatory permitting, and market conditions’.

‘By using American-produced natural gas we can boost global energy supply, support Japan’s decarbonisation goals and create jobs at home,’ comments Barry Engle, President of ExxonMobil Low Carbon Solutions.  

Marubeni plans to establish a global low-carbon ammonia supply chain for Japan and launch a global market for low-carbon ammonia, notes Yoshiaki Yokota, a Senior Managing Executive Officer at Marubeni. He adds that this will assist the decarbonisation of not only Japan’s power sector but also its hard-to-abate sectors, such as steel manufacturing [the power plant is named after the Kobe, Japan steelmaking plant where it is sited], as well as chemical production and the transport sector.

Earlier this year, ExxonMobil and Europe-based physical commodity trader Trammo announced plans to supply 300,000–500,000 t/y of low-carbon ammonia on a long-term basis for sale in Europe and worldwide. The ammonia will be used as fertiliser feedstock and for other industrial applications.  

Japan’s hydrogen import-export plans

Meanwhile, according to a new report from World Hydrogen Asia, Japan is one of the top two potential Asian partners for any hydrogen exporting nation, the second being South Korea.

Both countries rely mainly on oil, coal, natural gas and nuclear energy to meet their energy needs. The report notes that Korea’s nuclear share – 17% in 2023 based on International Energy Agency (IEA) data – is higher than Japan’s 5.8%. It adds that Japan uses more hydropower and biofuels, as well as a bit more wind and solar power. The two countries made it into the Top 5 list of IEA’s regional ranking of high CO₂ emissions from fuel combustion for 2022, with Japan ranking third, just behind China and India. With this in mind, Japan is taking steps to decarbonise, with a heavy focus on hydrogen usage, says the report.

Japan was the first country in the world to publish a national hydrogen strategy in 2017 and released an update in June 2023, it notes. The government recognised that securing a stable and long-term supply of inexpensive hydrogen and ammonia required creating sufficient demand in the first place. It set a goal to use up to 3mn t/y of hydrogen by 2030 and about 20mn t/y by 2050 in order to step up the transition towards a hydrogen/ammonia-based society.  

In May 2024, Japan passed the Hydrogen Society Promotion Act, which aims to support the creation of a supply chain for low-carbon hydrogen and derivatives such as ammonia and e-methane. The law introduced a low-carbon hydrogen business certification scheme to streamline the permitting process. The Act is also designed to help deal with cost challenges and to assist maiden large-scale hydrogen projects by accelerating their execution.

The Act came into force in October 2024, alongside a revised JOGMEC Act which put the Japan Organization for Metals and Energy Security (JOGMEC) in charge of low-carbon hydrogen supply chain subsidies, continues the report.  

The report also notes that Japan’s 7th Strategic Energy Plan released in February 2025 commits to decarbonising thermal power with hydrogen and ammonia, as well as carbon capture, utilisation and storage (CCUS).  

Ammonia as a fuel is of particular interest to Japan, suggests the report. The government hopes to gradually replace coal power in Japan with blue or green ammonia, starting with co-firing, such as that planned at Kobe power plant mentioned earlier. Moves have already been made in this direction, with Japanese electrical utility Jera, in collaboration with IHI Corporation and the New Energy and Industrial Technology Development Organisation (NEDO), announcing the successful completion of a demonstration test of 20% ammonia fuel substitution at the coal-fired Hekinan Thermal Power Station Unit 4 in Aichi, in April 2024.

Japan also sees ammonia becoming important in industrial heat and maritime transportation, according to the report.

The Japanese government is also supporting local sector players and in December 2024 announced subsidies for companies like Honda, Toyota and Asahi Kasei to develop hydrogen equipment and components. Honda will use the subsidy to produce new fuel cell systems and is to build a new facility in Tochigi Prefecture with an annual production capacity of 30,000 units. Toyota is looking to expand its operations in both fuel cell and water electrolysis systems. Asahi Kasei is reported to have received government support for the expansion of its manufacturing capacity for cell frames and membranes of alkaline water electrolysers.