Yara Growth Ventures AS, the venture investment arm of Norway-headed Yara International ASA, and US-headed Navigator Holdings Ltd, the owner, and operator of the world’s largest fleet of handysize liquefied gas carriers, have jointly led an investment round worth EUR 5.4 million in Norwegian ammonia bunkering startup Azane Fuel Solutions AS, to commence construction of the first of 15 bunkering units.
Yara International and Navigator Holdings have each successfully acquired a 14.5 percent interest in the Norwegian startup Azane Fuel Solutions AS.
Azane, a joint venture between Norwegian companies ECONNECT Energy AS and Amon Maritime AS, was founded in 2020 as a company that develops proprietary technology and services for ammonia fuel handling, to facilitate the transition to green fuels for shipping.
Subject to customary conditions, Azane intends to build the world’s first ammonia bunkering network, with Yara Clean Ammonia (YCA) already pre-ordering 15 units from Azane.
First ammonia bunkering units
The investment made by Yara and Navigator is expected to enable Azane to begin construction of its first bunkering unit for ammonia supply in Norway, aiming to kickstart the transition to zero-carbon fuels for maritime transportation.
Future value creation for Azane is expected to come through international expansion with its bunkering solutions and the broadening of its offerings in ammonia fuel handling technology.
The parties anticipate that the commencement of operations of the bunkering units will begin in Scandinavia in 2025.
Currently, ammonia fuel bunkering does not exist. With this investment it is expected to become a reality in a year, starting in Scandinavia. This is anticipated to be a huge milestone for reducing emissions from the shipping industry. By enabling Azane to be the first mover in providing this key part of the infrastructure, our goal is to fill a gap in the ammonia chain needed for fueling ships, commented Stian Nygaard, Investment Director, Yara Growth Ventures.
Large addressable market
Stian Nygaard is also joining the board to help build the company as a strategic investor.
Currently, the world of ocean shipping accounts for approximately 3 percent of global emissions.
Green ammonia is crucial to the future success of carbon-free shipping, and Azane is working to provide a solution to a clear and important gap in the ammonia fuel value chain. Global ammonia demand is expected to triple by 2050, with a significant part being for ship fuel. In an increasingly strong regulatory environment towards greener fuels in the shipping industry, I am very pleased Navigator is not only making efforts to become a more sustainable business itself but also investing in scale-ups that we believe can support and expedite the transition across our industry. We look forward to strengthening our working relationships with Yara and Azane through this partnership, said Mads Peter Zacho, CEO of Navigator.
The total addressable market for ammonia-powered ships is estimated to equal to the entire deep sea shipping fleet of 100,000 vessels worldwide, which over time is expected to transition to zero-carbon fuels.
Azane is a commercial partner of YCA, which expects to provide clean ammonia to be stored in Azane’s bunkering units once operational.
It will be a great strength for our company to partner with two of the leading ammonia players in the world, one from the industry and another one from gas shipping, both entering as strategic investors and joining the board to help build the company. The fresh funds will help accelerate the company’s growth ambitions in Scandinavia and internationally. As a first mover, Azane’s bunkering solutions will enable ship owners across the world to make the transition to carbon-free shipping by showcasing full-scale commercial bunkering projects, said André Risholm, Chairman at Azane.