Ammonia Bunkering to Pick Up in the Next 5 Years

In an interview with Gulf Intelligence, Michael Schach, CEO and co-founder of Calypso Commodities, highlights the importance of decarbonising the shipping sector, with ammonia bunkering poised to play a crucial role. The balance of supply and demand for ammonia is critical, as increased adoption in the maritime industry could drive substantial demand. However, production must scale to meet this demand without creating supply shortages or significant price fluctuations.

Regulatory Uncertainty and Key Ports

Schach discusses the current regulatory uncertainty surrounding ammonia as a marine fuel. As regulations evolve, the industry must navigate these changes to ensure compliance and safety. Key ports are beginning to develop ammonia bunkering infrastructure, positioning themselves as early adopters and leaders in this emerging market. The development of these facilities is essential for the broader acceptance of ammonia as a viable fuel alternative.

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Long-term Contracts, Hydrogen Supply, and Digital Tools

Long-term ammonia contracts are becoming more prevalent, providing stability for both suppliers and consumers. Additionally, Schach addresses the intersection of ammonia and hydrogen supply, noting that advancements in hydrogen production can enhance ammonia availability. The use of digital tools is emphasized to improve accountability and efficiency within the sector. Learning from the LNG sector's experiences, the ammonia bunkering market aims to adopt best practices to mitigate risks associated with "bad banks" and ensure reliable supply chains.

For more details, you can watch the full interview here.