Hydrogen production company Atome has signed a 60MW power-purchase agreement (PPA) with national utility Ande to power its green hydrogen project in Paraguay.

Atome hopes the facility in Villeta will produce 55,000t/yr of green ammonia. Following the signing of the PPA Atome will now begin commissioning the full Feed study. It anticipates taking FID on the project in the second half of 2022 and wants to complete the facility three years after that.

Renewable power for the project will come from a hydro substation on the River Paraguay near Villeta.

“Villeta, with the readily available renewable power, is a perfect site to fast-track Atome’s first project as it is very convenient for all types of potential offtaker,” says Olivier Mussat, CEO of Atome.

Atome says it has already been contacted by potential offtakers and expects further approaches as demand for green fertiliser increases. Villeta is an industrial centre and home to fertiliser and cement companies.

55,000t/yr – Ammonia production target

The price of ammonia has nearly quintupled over the past two years and now stands at over $1,500/t.

The Villeta facility is close to a port and could therefore serve export markets without significant infrastructure buildout. Paraguay has a detailed hydrogen strategy that says the nation could produce the fuel at less than $2.2/kg.

The project has not yet raised any significant financing but is looking to take advantage of regional and domestic grants as well as green infrastructure investment funds.

Fingers in pies

Atome is also developing a second, larger project in Paraguay that it hopes can produce over 200,000t/yr of ammonia by 2027. The project would receive electricity from the 250MW Itaipu dam hydropower project.

The firm is also developing a 100MW green ammonia project in Iceland to be powered by geothermal energy.

“Work on our Iceland projects continue with discussions ongoing with power suppliers, government representatives and potential stakeholders,” says Mussat.

Atome listed on the AIM branch of the London Stock Exchange in December after being spun off from independent oil and gas company President Energy with a £9mn ($11.2mn) fundraise at 80p per share.

In February, the firm created a transport and shipping arm that it hopes to be operational by the end of this year.

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Author: Tom Young