
Woodside Energy Group Ltd has announced the completion of its acquisition of OCI Clean Ammonia Holding B.V., which owns a lower-carbon ammonia project in Texas.
The US$2.35 billion all-cash transaction follows Woodside’s initial agreement announced on August 5, 2024, to acquire OCI’s 1.1 Mtpa Clean Ammonia Project.
The Texas-based project is currently under construction, with production targets set for:
- First ammonia production: 2025
- Lower carbon ammonia production: 2026
Once carbon capture and sequestration operations begin, the project is expected to produce ammonia with less than 35 per cent of the lifecycle emissions intensity compared to unabated ammonia.
Woodside CEO Meg O’Neill emphasised the strategic significance of this acquisition, stating that it positions Woodside as an early mover in the growing lower-carbon ammonia market.
O’Neill highlighted the versatile applications of lower carbon ammonia in power generation, marine fuels, and as an industrial feedstock.
The global ammonia market is projected to experience significant growth:
- Demand forecast to double by 2050
- Lower carbon ammonia is expected to comprise nearly two-thirds of the total demand
Woodside anticipates that the transaction will:
- Exceed capital allocation framework targets
- Be free cash flow accretive from 2026
- Contribute substantially to the company’s Scope 3 investment and abatement targets
The US$2.35 billion consideration includes capital expenditure through the completion of the project’s first phase.
Woodside has already paid 80 per cent of the amount, with the remaining 20 per cent due upon project completion. OCI will continue to manage the construction through provisional acceptance.
This acquisition marks a significant step for Woodside in the lower carbon energy sector, aligning with global decarbonisation trends and potentially positioning the company to benefit from premium pricing for lower carbon ammonia products.