Equinor, Vår Walk Away From Barents Blue Ammonia Project

Operator Horisont Energi finds a new partner in Spain’s Fertiberia, while Equinor and Vår seek alternatives.

Digital render of the proposed Barents Blue ammonia project planned for Northern Norway.
SOURCE: Vår Energi

Norwegian producers Equinor and Vår Energi have discontinued their participating interest in the Horisont Energi-led Barents Blue project planned for Finnmark in Northern Norway. The Barents Blue concept intends to make ammonia from natural gas from the Barents Sea, capture the CO2, and store it under the seabed.

The Polaris CO2 storage under the Barents Sea was selected as the storage solution for the Barents Blue project, and it has had the same partners as for the Barents Blue project. Consequently, Equinor has also concluded to not take further part in the Polaris CO2storage project.

Equinor and Vår Energi exited Barents Blue as the cooperation agreement expired on 31 January. Horisont Energi has signed a new cooperation agreement with the Spanish ammonia producer Fertiberia, for the project.

“Fertiberia and Horisont Energi share the ambition of accelerating the transition to carbon neutrality through pioneering projects,” said Bjørgulf Haukelidsæter Eidesen, chief executive of Horisont Energi. “Equinor and Vår Energi have been instrumental in maturing the project in the development phase ending 31 January. We look forward to work with Fertiberia to realize the project and hence contribute to the decarbonization of European industry and transportation.”

The partnership change took effect as of 31 January 2023. Fertiberia and Horisont Energi will hold a 50% stake in the project.

Once the first train is operational, Barents Blue is planned to produce 1 million tonnes of clean ammonia. The project is supported by a $48-million grant under the EU IPCEI hydrogen program, which is not affected by the changes in the partner consortium.

Vår Energi said it had investigated various alternatives for exporting the gas resources discovered in Alke and Goliat, west of Hammerfest, and the company decided to join the Barents Blue collaboration project in 2021 following efforts initiated by Equinor and Horisont Energi to establish an ammonia factory in Hammerfest, including CO2 capture and storage. The purpose was to explore tie in of the Alke and Goliat gas resources to Barents Blue while also contributing to a more comprehensive solution for the region overall.

“The partnership has worked actively to reach a concept decision, but the overall situation has led to the decision to seek other solutions,” the company said.

Equinor said it remains positive to explore gas supply solutions from Hammerfest LNG to the Barents Blue project following the changes in the partnership.

Equinor has several hydrogen and CCS projects in different phases in Norway and in other markets. In Norway, the Northern Lights CO2 transport and storage project, part of the Longship project, is already under construction and on track to be ready to receive CO2 in 2024.

Recently, Equinor and RWE announced that the companies have agreed to work together to develop large-scale value chains for low-carbon hydrogen, with a production facility in Norway and an export pipeline to Germany.

By 2030, Equinor has an ambition that 50% of the company’s gross investments will be dedicated to renewables and low-carbon solutions, such as CCS and hydrogen.