Aker Horizons, Statkraft pen long-term deal on Narvik green ammonia project

Business Developments & Projects

July 5, 2023, by Aida Čučuk

Green energy developer Aker Horizons has signed a 10-year power purchase agreement (PPA) with the supplier of renewable energy Statkraft, securing a significant amount of the renewable power required for its large-scale green ammonia plant under development in Narvik, northern Norway.

According to Aker, the PPA is conditional upon Aker Horizons taking a final investment decision (FID) for the Narvik project, and it covers the plant’s first ten years of operations, from commencement in 2028.

Aker Horizons Asset Development Director Sverre Isak Bjørn commented: “Signing a long-term power contract with Statkraft is essential to establish a sound commercial foundation and predictability for the Narvik green ammonia project. This agreement secures renewable energy for the project at competitive prices, paving the way for new green industrial development, new jobs and the ramp-up of the European hydrogen economy.”

Statkraft EVP Markets Hallvard Granheim noted: “Green ammonia is one of the solutions needed to help the green energy and industrial transition, and reach the net zero target.”

To note, the Narvik facility, with a planned capacity of up to 600 MW, is said to be one of the first large-scale green ammonia production facilities in Europe, with an expected production of between 1,000 and 1,500 tons per day.

The company said it has already signed offtake letters of intent (LoI) with major European energy, industrial and chemical companies for over 1.5 times the planned volumes of ammonia produced in Narvik.

In May this year, it signed a LoI with German gas group VNG, aiming to ship green ammonia from Narvik to Germany. At the time, VNG said it plans to procure up to 200,000 tons of green ammonia per year from the hub as of 2028.