Jakarta, September 9, 2024 – PT Pupuk Indonesia (Persero) has once again collaborated with ACWA Power, along with PLN Energi Primer Indonesia and PLN Indonesia Power, by signing a Head of Key Terms (HoT) agreement for green hydrogen procurement as part of green ammonia development. The signing took place at the Indonesia International Sustainability Forum (ISF) 2024 in Jakarta, as part of a joint commitment toward industrial decarbonization and green energy transition.

The green hydrogen development partnership between Pupuk Indonesia, PLN, and ACWA Power began last year. ACWA Power, a Saudi Arabian company, has extensive experience in developing, constructing, and operating clean power, water, and green hydrogen plants worldwide.

Through this HoT signing, Pupuk Indonesia and its strategic partners ensure the availability of green hydrogen as the main raw material for green ammonia production. This green ammonia can then be utilized by Pupuk Indonesia in the production of urea and NPK fertilizers, supporting the sustainability of raw material supplies for the national fertilizer industry. This development project aligns with the government’s vision to achieve net-zero emissions by 2060 and contributes to creating a robust and sustainable food security system in Indonesia.

(Second from the left in the photo) Rahmad Pribadi, President Director of Pupuk Indonesia, stated, “We are not only ensuring smooth production but also securing the supply of raw materials. Today’s steps can reduce the use of non-renewable raw materials. Non-renewable sources like natural gas will eventually run out. That’s why this is our strategic move to replace natural gas with water, allowing Pupuk Indonesia to continue supplying fertilizers needed by farmers and to remain a key player in supporting national food security.”

The project will involve the construction of a green hydrogen plant by Project Company, a joint venture formed by ACWA Power with PLN Energi Primer Indonesia and PLN Indonesia Power under a Joint Development Agreement signed in December 2023. Project Company will act as the selling entity responsible for producing and managing green hydrogen. The green hydrogen produced will be supplied to Pupuk Indonesia and other partners under a long-term contract of 25 years. This hydrogen is produced through water electrolysis supported by renewable energy, ensuring low carbon intensity.

This collaboration aligns with the Green Economy Pioneer 10 Years Roadmap initiative of the Ministry of State-Owned Enterprises (BUMN), promoting synergy among state-owned companies to lead the green energy transition in Indonesia. The green hydrogen from this project will be used as a raw material for green ammonia production, a key component in more environmentally friendly fertilizers.

Rahmad further explained, “Pupuk Indonesia recognizes the significant responsibility to support the achievement of natural carbon emission reduction. Therefore, we are taking strategic and tactical steps to reduce carbon emissions from our company’s activities.”

This initiative drives the development of green hydrogen and ammonia technologies while contributing to global emission reductions. This strategic collaboration will create a long-term positive impact on the environment and future generations, meeting the world’s growing demand for more sustainable products.