Lotte Chemical and Itochu Corporation Sign MOU for Hydrogen and Ammonia Business Cooperation

Japan Itochu Corporation and MOU on Ammonia Utilization and Hydrogen Business Cooperation

Hwang Jin-gu, Head of the Hydrogen Energy Business Division at Lotte Chemical (right), and Masaya Tanaka, General Manager of the Energy Chemicals Company at Itochu Corporation, held a memorandum of understanding signing ceremony on the 21st at the Itochu Corporation headquarters in Tokyo, Japan. Photo by Lotte Chemical

[Asia Economy Reporter Donghoon Jeong] Lotte Chemical has established a cooperative relationship with a leading general trading company in Japan to secure the stability of hydrogen and ammonia supply in the East Asian region and to expand the market.

On the afternoon of the previous day, Lotte Chemical announced that Hwang Jin-gu, head of Lotte Chemical's Hydrogen Energy Business Group (also CEO of the Basic Materials Business), and Masaya Tanaka, General Manager of the Energy Chemicals Company at Itochu Corporation, along with related executives, attended the signing of a "Comprehensive Memorandum of Understanding (MOU) for Hydrogen and Ammonia Business" at Itochu Corporation's headquarters in Tokyo, Japan.

The two companies agreed to cooperate in the ammonia trading business to collaborate in the hydrogen and ammonia sectors, which are attracting attention as future energy sources for achieving carbon neutrality. They will also join forces to develop the hydrogen and ammonia market and cooperate in utilizing ammonia infrastructure targeting the Korean and Japanese markets. Joint investment in clean ammonia production facilities and the establishment of additional cooperation models in the hydrogen sector will also be pursued.

Ammonia is gaining attention as a hydrogen carrier that enables low-cost and efficient transportation and storage. As a fuel that does not emit carbon dioxide (CO2), its use in thermal power plants or ships contributes to reducing greenhouse gas emissions.

Hwang Jin-gu, head of Lotte Chemical's Hydrogen Energy Business Group, stated, "Lotte Chemical's ammonia distribution and utilization infrastructure and business experience, combined with Itochu Corporation's expertise in ammonia bunkering and global network, will create a meaningful step toward achieving carbon neutrality."

Masaya Tanaka, General Manager of Itochu Corporation's Energy Chemicals Company, emphasized the significance of the MOU by saying, "Together with Lotte Chemical, we will accelerate responses to build a sustainable energy system in Korea and Japan through competitive decarbonized fuel procurement, including joint ammonia procurement and logistics optimization. We aim to contribute to the Sustainable Development Goals, strengthen responses, and realize carbon neutrality."

Meanwhile, Lotte Chemical aims to invest 6 trillion KRW by 2030 to produce 1.2 million tons of clean hydrogen, distribute and utilize it, and achieve sales of 5 trillion KRW. Specifically, of the 1.2 million tons of hydrogen production, 600,000 tons will be supplied for power generation, 450,000 tons for fuel cells and hydrogen gas turbines, and 150,000 tons for transportation. Among these, the 600,000 tons for power generation demand will be produced overseas as clean hydrogen, converted into ammonia?which has economic advantages in storage and transportation?and then imported into Korea.

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