Startup Series: Unlocking Ammonia as Energy with Amogy

This episode explores Amogy's innovative approach to harnessing ammonia as a clean energy source, particularly for the shipping industry.

1. Amogy's technology focuses on converting ammonia into hydrogen to power fuel cells, bypassing traditional combustion methods that produce greenhouse gases.
2. The company is targeting the shipping industry, aiming to replace heavy, pollutive fuels with ammonia, which is easier to transport and store than hydrogen.
3. Amogy has successfully raised substantial funding, illustrating strong investor confidence in their technology and business model.
4. The episode discusses the potential for ammonia to be a key player in the green energy transition, not just for shipping but also for broader industrial applications.
5. The conversation also touches on the challenges of scaling such technologies, including the toxicity of ammonia and the infrastructural changes required for widespread adoption.

1: Introduction

The hosts introduce Dr. Seonghoon Woo and outline Amogy's mission to innovate within the clean energy sector. Jason Jacobs: "Today on my Climate Journey's startup series, our guest is Doctor Seonghun Woo, CEO and co-founder at Amogy."

2: Amogy's Technology and Impact

Dr. Woo explains the technical workings of Amogy's system that converts ammonia to hydrogen for use in fuel cells. Seonghoon Woo: "Amogy's unique innovation is in cracking ammonia into hydrogen at the point of power generation."

3: Investment and Growth

Discussion on Amogy's funding achievements and the significance of their investor base. Seonghoon Woo: "We've raised $220 million of funding, emphasizing the importance of our backers."

4: Challenges and Future Directions

The challenges of handling ammonia safely and efficiently, and the future of ammonia as a sustainable fuel. Seonghoon Woo: "Ammonia, while being a potent energy carrier, poses safety and technical challenges that we are continually addressing."

5: Closing Thoughts

The hosts and guest summarize the discussion and its implications for the future of energy and the environment. Jason Jacobs: "Thanks for shedding light on how ammonia can revolutionize energy use in heavy industries."

1. Consider the potential of ammonia as a cleaner fuel alternative in industries reliant on heavy fuels.
2. Explore investments in companies innovating in clean energy technologies.
3. Support policies that encourage the development and adoption of green technologies.
4. Stay informed about advancements in energy technologies to understand their impact on climate goals.
5. Engage in discussions about sustainable energy solutions within your community and professional networks.

Dr. Seonghoon Woo is CEO and co-founder at Amogy. Amogy is building technology to unlock ammonia's potential as a clean energy fuel source for transportation and beyond. About a year ago, they raised a Series B of funding led by SK Innovations, with backers including Temasek, Aramco Ventures, Mitsubishi, DCVC, Amazon Climate Pledge Fund, Mitsui OSK Lines, and others.

Ammonia is a workhorse chemical in modern society. It's one of the most produced chemicals in the world today, and it's used primarily as the foundation of the nitrogen fertilizer industry, as a transport vessel for nitrogen. Chemically, ammonia is NH3, so in addition to nitrogen, it contains hydrogen. And hydrogen as we know has a strong potential as a low to zero emissions fuel source, depending on how it's produced.

But hydrogen is challenging to transport. Ammonia, therefore, also has the potential to be a transport vessel for hydrogen as a power source, and ammonia supply chains are already mature today. Amogy's unique innovation lies in cracking ammonia into hydrogen at the point of power generation and then powering vehicles via hydrogen fuel cells. They are targeting ocean shipping as most major companies seek solutions to decarbonize their supply chains.

People

Jason Jacobs, Cody Simms, Yin Lu, Seonghoon Woo

Companies

Amogy

Books

None

Guest Name(s):

Seonghoon Woo

Content Warnings:

None

Jason Jacobs
Today on my Climate Journey's startup series, our guest is Doctor Seonghun woo, CEO and co founder at Amagy. Amagi is building technology that intends to unlock ammonia's potential as a clean energy fuel source for transportation and beyond. They raised a series B of funding about a year ago, led by SK Innovations, with a who's who of backers from industry and venture capital, including Temasek, Aramco Ventures, Mitsubishi, Marinucci Climate Tech Growth Fund, DCVC, Amazon Climate Pledge Fund, Mitsui, OsK Lines, and others. Ammonia is a workhorse chemical in modern society. It's one of the most produced chemicals in the world today, and it's used primarily as the foundation of the nitrogen fertilizer industry as a transport vessel for nitrogen.

Chemically, ammonia is nh three. So in addition to nitrogen, it contains hydrogen as well. And hydrogen, as we know, has a strong potential as a low to zero emissions fuel source, depending on how the hydrogen is produced. But hydrogen is challenging to transport. Ammonia therefore also has the potential to be a transport vessel for hydrogen as a power source.

And ammonia supply chains are already mature today, amogy's unique innovation is in cracking ammonia into hydrogen at the point of power generation and then powering vehicles via hydrogen fuel cells. They're going to market targeting ocean shipping, as most major companies are seeking solutions to decarbonizing how they transport goods through their supply chains. Seonghoon and I discuss all of this and more in a good amount of detail. But before we start, I'm Cody Sims. I'm Yin Liu.

And I'm Jason Jacobs. And welcome to my climate journey. This show is a growing body of knowledge focused on climate change and potential solutions. In this podcast, we traverse disciplines, industries and opinions to better understand and make sense of the formidable problem of climate change and all the ways people like you and I can help.

Doctor Seonghun Woo, welcome to the show. Thank you for having me. We're gonna go all into chemistry today. It's gonna be so much fun. Nitrogen, hydrogen, ammonia, obviously all this stuff.

But before we do that, why don't we start out with a bit of an introduction of you. Tell us a little bit about where you got the idea for amagy and what work you were doing that led to the insight to start the company. Thank you for having me and thank you for this opportunity today. So, my name is Sunghun. I'm the co founder and CEO of company MG.

Seonghoon Woo
And yeah, going back to the journey, before starting the company, I myself was trained as an engineer. I went to MIT for my PhD program but it was not about the hydrogen or ammonia. My PhD program was more about the physics, and semiconductor physics in particular. So after graduating from the MIT PhD program that I worked in the semiconductor industry essentially for the roughly five to six years of the timeline. Then I worked for IBM before starting company.

But of course, I mean, even if the area was different from what I'm doing right now, I've always been interested in the energy problem. So essentially in the semiconductor industry, I was looking at the energy problem at the nano scale. And then at the same time I want to start something new where I can contribute my technical expertise to make the differences in the world, drive the world positively in the immediate future. That really got me to thinking about really starting a company and startups, and even if I didn't have any idea what that would actually mean. So I started being more interested, especially during the COVID in 2020, because I had more time.

I really wanted to start doing something else. That's how I started thinking about starting a company. But I didn't have any specific topics myself, because my expertise again, was so different from what I'm doing. And also my very particular specialties in semiconductor area was essentially looking at the 20 to 30 years of the development timeline. From that point, probably mid 2020, I started reaching out to the people that I knew, especially from the MIT PhD program.

So I got connected to our co founder. So Amoj has four co founders. So I got connected to three co founders that I knew for a while. And a couple of them, especially our CTO, was working on the ammonia and hydrogen spaces directly. And so I learned about hydrogen and hydrogen economy.

Ammonia in particular was fascinating to me in the way that ammonia could be the solution to really solve the big problems we have in Taijun economy. But of course, I didn't know deeply enough about this. I mean, ammonia, what we are doing today, but still, the idea or the technology itself was very interesting, intriguing to me. So that's how we essentially got together and got together to the point where we really were committing to starting a company that was probably the end of 2020. And then, yeah, that was the beginning of Amoe, essentially.

Jason Jacobs
You all have been on a rapid pace since then. I'm really interested to hear, I love hearing from founders on how they ultimately decided, especially with four of you as co founders, how you ultimately decided what roles to each take in the company. Looking at your background, you haven't built five or six companies in the past. You took the role of CEO of this thing. You didn't even have necessarily sector expertise in this space.

How did you all divvy that up and figure that out? All of us, the four co founders got the PhD from MIT, so we are all doctors and working at the large organizations. Myself for IBM, the other people for company, like Samsung or shells, for example. And when we got together, you essentially have to divide roles so you can start a company. And to be honest, from the technical standpoint, even if I had PhDs and such, but I really didn't know anything about ammonia, but the other people probably knew more about the ammonia and energy and how we can actually make this work.

Seonghoon Woo
So probably the least amount of technical knowledge that I had on this particular deal drove me to be taking this commercial or fundraising side of role. But at the same time, for the founding period, I was the only one living in the US and the other three were actually living in Korea. So I was the one essentially going out to find a location, going out to really find investors in the beginning. And I think I was really putting people together so that we can drive the momentum towards actually making the company. So we had a couple of discussions, of course, within our boras, but I mean, discussions were natural to bring me to the CEO role, really taking, I mean, spending more than 100% of the time really finding the investors and the other people fully focusing on the technology and the development of technology so that we can really scale up quickly.

Jason Jacobs
Well, you must be a quick learn because you all have raised a significant amount of money in a very short amount of time. Maybe share a little bit about the series B round that you raised, I guess about a year ago now. That's right. So company today is roughly three and a half years old. During that three and a half years of the lifetime, we've raised the $220 million of the funding.

Seonghoon Woo
Especially last year, roughly about a year ago, we raised $150 million series fee, which has really helped the company to start commercializing this technology. But yeah, Amanda sell. We have raised substantial amount of the funding. We always appreciate the support from the investors and partners, really make it happen. But at the same time, we also realized that to truly develop technology, like the technology that we are developing, and also change the industry, like the heavy industry or the shipping, you really, really need a large amount of Cape cloud to really make that happen.

So this is also good learning for us that we are going through as well. Obviously, you can't measure a company's success by how much money it raises. You have to measure it by the business it builds. But in 2023, I think unless you've been living under a rock. Everyone listening to the show knows that it was really hard to raise money in 2023.

Jason Jacobs
So congrats to you for pulling that together and with a really impressive roster of investors who can contribute, I believe, not just capital, but also industry and sector awareness and support to your business. You've got SK innovations out of Korea, I believe. You've got Temasek out of Singapore. You've got Aramco, you've got the Amazon Climate Pledge Fund, DCVC, Mitsui, Osk Lines, Marinucci Climate Tech Growth Fund, Mitsubishi. You've got some heavy hitters around the table with you.

Seonghoon Woo
Certainly we are very fortunate to have amazing investors at the cap table. We also realize that to truly make the meaningful impact in this heavy industry, you really have to collaborate. Without the collaboration, there's no way that a single startup, no matter what technology you have and how fast you can grow, you can never make the decarbonization of the heavy in the solve that big problem that we have to solve collectively. So that's why we are excited to have these shareholders on the cap table. But as you mentioned in the beginning, I mean, I always think that average is really at the beginning of a surgeon.

We've grown to this size, to this scale for the last three and a half years. But the problem that we are targeting to solve, we have to solve, like decomposition of the heavy industry, have to be solved over the severe decades of the time that 25 years, ideally, so that we can truly reach 2050. So I always try to look at the really the next five years and ten years, because that's the real timeline that we have to start achieving the goals that we have said in the beginning. What is AMG? AMG, first of all, is the technology startup company.

We develop technology which is essentially converting ammonia to energy. So ammonia to electron. So that's how we got the name energy, ammonia plus energy. And just to give you a little bit context of the ammonia, ammonia may be new to many people listening to this pocket. So ammonia is the second most produced chemical in the world today.

So we use most of them as a fertilizer, essentially the fertilizer of the 2024. But ammonia actually has very high energy density. Ammonia being nh three, not having the carbon, has high standards density among the non carbon chemicals, even higher than the liquid hydrogen. While ammonia can be liquid at room temperature, the hydrogen has to be cooled down to probably negative to 50 celsius. So because of the ease of the transportation and also the storage, ammonia also gives you the lowest price point at the point of use.

So ammonia is really zero carbon, high standards density, and the most affordable fuel we could possibly use. However, there has not been technology converting this chemical to energy effectively and efficiently. So that's the technology emojis, developing emojis provided to the market for the first time. From my own knowledge, what is the most produced chemical on earth? I think that is also one of the fertilizer.

I forgot, I mean, surfer derivative fertilizer, if I remember correctly. Interesting. So, potentially, if your answer there was correct, the two most produced chemicals on earth are both for food production. Are both used primarily for food production, because I believe 80% of ammonia use today is to create nitrogen fertilizers. Is that true?

100%. That is right. Probably more than 80%, because, I mean, ammonia essentially has been the backbone of the population growth over the last, probably about a century. So the discovery of the mass production of the ammonia, which happened in 1920s, really helped the population growth, because now we can produce the food as much as needed. Now, you described ammonia obviously by its chemical compound, nh three.

Jason Jacobs
As I understand it, when ammonia is produced, the nitrogen is just used atmospherically. You're just pulling nitrogen out of the air. The hydrogen is currently the challenge and subject today to a huge amount of investment to try to green hydrogen production. So the ability for ammonia to be a low emissions fuel, I believe, would be dependent on, ultimately the emissionality of the hydrogen that is used in that ammonia production. Is that correct?

Seonghoon Woo
Yeah, that is correct. As you said, ammonia is made out of feedstock hydrogen and nitrogen. Nitrogen. We have 80% of nitrogen out of the air, which you can accumulate, really, to provide the nitrogen to the ammonia production. But the hydrogen is the.

Probably the most important feed for the ammonia production. So, as you noted now, I mean, the green hydrogen or blue hydrogen, that is eventually what's making green ammonia and blue ammonia. But if you look at the hydrogen industry and the hydrogen production. So, essentially, hydrogen today is used for probably only two reasons. One is the ammonia production.

The other is the petrochemical use case. Probably more than half of the hydrogen is now used in ammonium, which will, I believe, likely be the case moving forward as well as we become to use ammonia as a fuel. Ammonia is essentially, from our standpoint, helping the hydrogen economy to really offer the opportunity to store that energy at the longer term and much more efficient way. Most of hydrogen today is produced using natural gas, using steam, methane reformation. But obviously, with the bipartisan Infrastructure law and the Inflation Reduction act, there are now huge incentives for both electric hydrogen with the 45 volts tax credit, I believe, and you called it blue hydrogen, which I believe really is natural gas, produced hydrogen, but that has also carbon capture and sequestration attached to it, which also had an expansion of 45 q in the Inflation Reduction act to allow for tax credits to go toward that method of producing hydrogen.

Jason Jacobs
So in both cases, trying to produce hydrogen that is essentially low emissions. Yes, 100%. That is correct. But also, at the same time, interestingly, if you look at the gigawatt or more than gigawatt scale, green or blue hydrogen project globally, which has been initiated, facilitated by the IRAS and other incentives and subsidy structures coming to the industry, probably more than half of these hydrogen project finite products are ammonia instead of the hydrogen. Because ammonia we today have the offtake market, essentially as a fertilizer.

Seonghoon Woo
And also ammonia is offered as the fuel for power generation and also the shipping. So much bigger interest coming to ammonia for the fuel use cases, which is driving those green or blue hydrogen projects towards the ammonia production. Essentially, ammonia is also taking the same advantage of the IRA and other 45 B 45 qs incentives and subsidies, because that's making the green and blue ammonia more economical and much cheaper, so they can deploy to market much more attractively. I think of today ammonia as largely being a transport vehicle for hydrogen and nitrogen. Is that the right way to think about it?

Today, ammonia, yeah, should be viewed as a hydrogen carrier today. I mean, existing use case of ammonia is simply to transport ammonia, to be used as a fertilizer. But as we think about the ammonia in the traditional landscape, ammonia is really the way to transport hydrogen to the longer distance and store it for the long duration so that you can effectively and cost economically use it. What are the challenges of transporting hydrogen by itself? The biggest, probably the issue around hydrogen as a fuel is really transportation and storage.

Because if you want to transport hydrogen scale and also at high density, for example, if we want to liquefy the hydrogen, to make it liquid, so that you have so much of the hydrogen within the limited volume, but the liquid fraction itself is energy intensive. It's roughly 70% of the energy efficiency. So 30% of the energy is lowest there. And also, even if you want to keep it cool, as cold as the negative 250 celsius, there is always the boil of gas coming out of it. So you will start losing hydrogen.

So because of all these complexities and also very expensive process you have to go through, you can actually see the numbers, I mean, reflecting these complexities. For example, hydrogen today is produced at $3 or $2 per kilowatt gram basis of natural gas based hydrogen. But if you look at the hydrogen price at the refueling station in California or Canada, you have to pay roughly around $20. So the gap between $3 production versus $20 retail price of the hydrogen at the refueling station really tells you how inefficient and expensive it is to store and transport hydrogen. And is most ammonia produced on site at hydrogen production facilities, so that you're not having to transport it at all?

That's right. And that's essentially the benefit of producing ammonia on site, the hydrogen, because you don't have to go through the reconfection, you don't have to deal with the hydrogen storage, the transportation. But ammonia production is very efficient. Process has been very well optimized over the last decade, so you can produce ammonia very quickly and efficiently from hydrogen. And who are the primary ammonia suppliers and producers today?

So, essentially, the biggest fertilizer companies are the primary producer suppliers of the ammonia today. So in the United States here, the biggest one is probably the CF industry, the fertilizer producing company. And there are other companies such as LSD Industries and many others, probably mainly based in the Gulf coast area, where they have refineries because they have access to the natural gas. So they're setting up shop right next to a steam methane reformation plant that is breaking down natural gas into hydrogen. Exactly.

Because of the IRA that is the first coming to the market, they are also setting up these blue and green ammonia facilities along the Gulf coast area as well. But internationally, there are other companies like Yara, based in Norway, who is the largest and more produced state. I believe this, I think, is really showcasing, hopefully for all listeners, why there's so much investment going on into green hydrogen and blue hydrogen in the first place, which is, if it's this huge of a factor in food production, everybody's got to eat. So how do we produce food that is lower emissions? Obviously is a huge use case and a huge driver of this investment into producing hydrogen in different ways.

Jason Jacobs
But what I'm hearing from you is if all this investment is already going into the hydrogen economy and this hydrogen is being turned into ammonia to create fertilizer, and it's being done increasingly in lower emissions ways to create lower emissions ammonia. Hey, can this low emission ammonia now be used for things in addition to fertilizer production? Is that the insight, I guess, that we should have as a takeaway here? 100%. Yeah, that's really good.

Seonghoon Woo
Summary of what we discussed for the last five to ten minutes, I believe, because as you said, I mean, we have to use the existing use case of hydrogen. Existing use case. The ammonia, which is fertilizer, where, I mean, more than half of the hydrogens now use ammonia for the fertilizer, which is big area that we have to solve. But at the same time, if you want to think about using this chemical as a fuel, ammonia also offers the opportunity to use that as a fuel, because the transportation storage issue is not there, like hydrogen, for example. But the big question here is then, how can you use ammonia as a fuel?

Because if you look at the industry, like heavy industry shipping or the heavy industry power generation, the primary method that we are generating power out of the fuel, like the hydrocarbon, is the combustion. You just burn the fuel like heavy fuel in the shipping engines or the gasoline or diesel and the power generation or even coal. But ammonia, unfortunately, is not combustible. So there's no way that you can burn ammonia itself. The combustibility is very, very low.

But, of course, you could burn ammonia together with the diesel, together with gasoline. Then you start generating greenhouse gas again. So here comes our novel technology, which really enables the use of the ammonia as a fuel while not combusting. So we developed that technology so that our customers in the heavy industry can start using ammonia as a fuel vitally while not generating the unnecessary greenhouse gases. What your technology does is it essentially on site on the ship, converts ammonia to hydrogen and then runs the hydrogen through a hydrogen fuel cell to power the ship.

Jason Jacobs
Am I understanding correctly? That's right. Our technology and the products includes the conventional hydrogen fuel cell. So from the ship owner and operator perspective, you just feel ammonia to our essentially the engine. But we don't call it engine because we are not combusting.

Seonghoon Woo
We call it just power pack. But you just feel ammonia into our power pack. Then we convert that to hydrogen and then directly to electricity. But essentially, you see the electricity coming out of the product. So we call ammonia to power product.

That's what we are building before we. Get to specifically the conversion steps that you all do. Just for our listeners and my own knowledge in a basic hydrogen fuel cell, this is an electrochemical transition. It's not combustion. You're not actually burning the hydrogen.

Jason Jacobs
You are separating h two into individual hydrogen molecules and creating electromagnetic charge as a result of that. Is that correct? Yeah. Electrochemical process. As you said, hydrogen fuel cell.

Seonghoon Woo
Conventional hydrogen fuel cell that we have in Toyota libre or Hyundai nexo that uses electrochemical process, breaking the hydrogen and getting that combined with oxygen so that you generate the electricity, but that process is still a part of the amoeg product as well. AMG product we have ammonia to hydrogen conversion process before the fuel cell and the produced hydrogen goes to the fuel cell to generate power. The ship themselves are then running off of electricity generated by the hydrogen fuel cell. That's right, that's right. Ship themselves.

I mean, there are already a number of ships, especially the european public shipping industry, where there are a number of electrified vessels using the DJ electric generator, essentially. So we can replace that. Or in the large vessels we can replace the auxiliary generator, which is all these electron generators using the Djot today. Hey everyone, I'm Yin, a partner at MCJ Collective, here to take a quick minute to tell you about our MCJ membership community, which was born out of a collective thirst for peer to peer learning and doing that goes beyond just listening to the podcast we started in 2019 and have grown to thousands of members globally each week. We're inspired by people who join with different backgrounds and points of view.

Yin Liu
What we all share is a deep curiosity to learn and a bias to action around ways to accelerate solutions to climate change. Some awesome initiatives have come out of the community. A number of founding teams have met, several nonprofits have been established, and a bunch of hiring has been done. Many early stage investments have been made, as well as ongoing events and programming like monthly women in climate meetups, idea jam sessions for early stage founders, climate book club, art workshops, and more. Whether you've been in the climate space for a while or just embarking on your journey, having a community to support you is important.

If you want to learn more, head over to mcjcollective.com and click on the members tab at the top. Thanks and enjoy the rest of the show. And so it sounds like the problem you're solving for shipping is, one, they don't have to buy incredibly giant lithium ion batteries to have electric shipping. They can use this hydrogen fuel cell methodology. But two, they don't have to deal with the complicated transportation of hydrogen itself to power their ships.

Jason Jacobs
They can use ammonia, which is a much more common commodity fuel source for them to pull into the ships. And then you'll convert it into hydrogen on premises. That's right. Especially the second point that you mentioned. That's really the value that we are offering using our technology.

Seonghoon Woo
The hydrogen economy has been tapped into probably longer than five years, especially in the country like Japan, Korea, east asian countries mainly. They've looked into the hydrogen economy using the fuel cell plus hydrogen approach, probably longer than five years. But that has really taken off, mainly because from our standpoint, the difficulties around transportation and storage of hydrogen. But we are offering a solution where we can transport and store the hydrogen not as a hydrogen, but as ammonia. But our technology converts that all the way back to the electricity.

Jason Jacobs
Today, shipping mostly uses this really nasty, heavy fuels that are heavily emitted. We talked about batteries as a potential option. We talked about pure hydrogen as a potential option. I guess methanol is another option that I hear thrown around as a way to decarbonize shipping. Is that a viable pathway for ships to take as well?

Seonghoon Woo
That's right. From our standpoint, of course, the ammonia is a very, very high potential. And we believe ammonia is going to be the dominant fuel in the shipping industry in the next two to three decades. But still, we really need all the different energy means to truly make the transition happening in the 25 years. So vanity should be an option.

So there are good vessels or ships which may be better to take vanity, like the short distance, like fairways, high speed fairways, where battery may be able to provide enough energy and also the recharging is possible. And also same for hydrogen and also methanol, ammonia. But ammonia really has the hypertension, simply because ammonia can be produced at large scale very cheaply. But speaking of the methanol, methanol is a great option as well, because if you can make the green methanol, then there are existing methanol engines which have been available longer than ten years in the maritime industry. Because if you look at the methanol carrying vessels, which we call methanol carrier, they have been using methanol engine longer than ten years because it's better for them to use the cargo as a fuel so that they don't have to have the separate cargo for like, heavy fuel oil technology is there and the way to store is there.

And as long as green ammonia, a green methanol is available, it should be able to provide essentially the net zero solution for the shipping. So there are already companies such as Maersk, which is one of the largest shipping company in the world, have built and have ordered and sizable scale of the methanol powered vessel, which we are excited about as well. So methanol, like hydrogen, and therefore like ammonia, obviously can be produced in green ways or in fossil fuel derived ways. And we as a society are hoping and helping both of those supply chains are able to move to a green methodology, obviously, as quickly as possible. What are the different use cases or reasons why ammonia would be favored over methanol?

Jason Jacobs
Or I guess, what are the reasons you think that the ammonia based solution might mature more quickly or ultimately scale better. So if you look at the shipping industry today, we use roughly 200 billion ton of the fuel every year. But if you want to change the fuel to renewable fuel, because the renewable fuel has at the very best, half of the energy density of the heavy fuel oil, you essentially need 400 million ton of the fuel or more than that every year. And what is the fuel which can be produced at that scale while maintaining the low cost? So that's the primary challenge when I see the methanol and industry sees the methanol.

Seonghoon Woo
Because if you think about the green methanol, you need the carbon source, essentially, which could be coming from technology like direct air capture or the biogenics resources. But using that resource of the carbon and producing the green methanol at hundreds of the million ton of the scale is going to be very, very expensive. And can we achieve that within the next two to three decades? That's the primary challenge when it comes to fuel. But ammonia, we're producing green ammonia or blue ammonia at this scale of the hundreds of the million ton is not as challenging.

Because if you look at the green methane green ammonia project already, I mean, post FID, we have probably more than ten mta, 10 million ton by 27, and more than 100 million ton pre feed and feed stage, meaning it's much more economical to produce ammonia scale. That also gives the industry to hope that this field can be available at the scale that the industry needs. While the economics is making sense. Nate, I suppose a little bit unspoken in what you just articulated as well is there's already a ton of incentive to produce green ammonia for food production. If you can piggyback off of that, you can benefit from that scaled production that is already likely to happen.

That is something that has to happen. But I'm not sure how much incentive from the agricultural industry which drives them to decarbonize the fertilizer itself. But there is existing off tech market, which is agricultural industry, and the fertilizer market, as I mentioned. Certainly there are drivers in that industry. And also there is probably more drivers in heavy transportation, heavy industries such as maritime shipping or even power generation.

So they have the common ground around the ammonia as a fuel. So that really is getting even more highlighted in both industry. Therefore, there's more momentum coming to the fuel side as well. Super helpful background. Let's go back to the ship.

Jason Jacobs
So you've got a ship, you've got tanks of ammonia. Ammonia is not as energy dense by volume. So you actually need a pretty significant amount of it. I don't know if that's correct or not. And then you have this converter on the ship that then converts to hydrogen and runs to a fuel cell.

What is the energy requirement of that conversion process? First of all, the fuel space point. Yes. Ammonia is not as energy dense as the conventional shipping fuel, probably about 30% to 40%. However, ammonia still has the high standards density among the renewables, even higher than the liquid hydrogen.

Seonghoon Woo
So I don't think the ship owners and operator will occupy the more spaces for fuel. Instead, they will likely be doing more of the refueling. So the bunk ring activity is going to be twice or three times more frequently. That's why the bunker ring is also important, but going to the efficiency front. So our technology takes ammonia and first converts to hydrogen, but produces the hydrogen, goes to the fuel cell directly without having the hydrogen storage.

So the overall process from ammonia in electricity out is roughly 40% efficient. But that includes the 50% efficient hydrogen fuel cell. So the pre process, as well as all the balance of plants, gives you roughly 80% efficiency, which is very high. What are you using to power that conversion process? Ammonia convergent to hydrogen, which is called ammonia cracking, or ammonia reforming, is the endothermic reaction.

So you need the heat source to make that happen. So in our case, we use the combustion of the hydrogen, meaning you take 100 ammonia and produce roughly how many hundred hydrogen, produce 100% of hydrogen, then roughly 20 out of 100 hydrogen goes back to the combustor. So you do the combustion of the hydrogen to generate the heat necessary for the ammonia cracking. Do you have some catalyst to get it started? So our ammonia cracking technology is a thermocatalytic chemical process.

So within the catalyst bed, the multiple baths we have amid catalyst material, which is essentially the core technology, innovative technology that we developed, cracking ammonia hydrogen very efficiently at the low temperature. I want to understand some of the challenges you have in potentially scaling it. Ammonia can be toxic, though. So can heavy shipping fuel, I'm sure. Are there any concerns with the storage of the ammonia on the ship?

Jason Jacobs
We've all accidentally breathed in ammonia in science class. You can feel it coming through your nose. What are the requirements around being around it that are important for the folks on the ships to be aware of? Ammonia is a toxic substance. The risk shouldn't be underestimated, because ammonia, I mean, at the certain concentration that were higher, can really kill the people and kill.

Seonghoon Woo
I mean, really the living elements are out there. However, ammonia, from the storage and transportation perspective, has been stored and transported over the course of last, essentially 100 years. And there are roughly 20 dedicated ammonia carriers globally. There are roughly 500 carriers and vessels capable of carrying ammonia as well. Irrelevant to all these new discussions about ammonia as a fuel.

So storage and transportation from the safety management perspective and the regulatory perspective has been very well established and developed over the course of that timeline. So we can essentially piggyback on this existing knowledge of using and storing, transporting ammonia. Another question I have on challenges is we talked about, obviously, the chemical makeup of ammonia is in h three. You're using the hydrogen to power the fuel cell of the ship, but you have this byproduct of nitrogen. How do you avoid the creation of nitrous oxide coming out of your process, which, of course, is by itself a different, very powerful greenhouse gas?

Our process within the ammonia to hydrogen cracking process, one thing that I have to emphasize is we are not burning ammonia. So if you burn ammonia, combust ammonia, then you may be able to avoid the CO2, because there's no CO2 there, but there's going to be massive amount of the nox, nox nto coming out of the system. Then you generate even worse. I mean, because nox is probably 2030 times more harmful compared to CO2. But again, within our process, we are not combusting ammonia.

So there's no nox coming out of it. It's only the nitrogen, which is essentially the air, 80% of the air nitrogen coming out of the system, which is not making any impact on the environment. Tell us about your current traction. Where are you in terms of ships on the water, in terms of commercial partnerships? Any of the milestones that you think our listeners should know about?

As I said, the company is three and a half years old. But in the very first two years of the company, we really focused on demonstrating scalability and viability of technology, because from the beginning, we always knew that ammonia is best suited for heavy industry, like the shipping. So we wanted to demonstrate that our technology is suitable for those heavy industries. In the first two years, we demonstrated really the world's first ammonia power zero emission drone tractor truck, like the John Deere truck powered by ammonia in 2022, and Franklin or Cascadia, the semi truck class A truck powered by ammonia in 2023, which we demonstrated successfully to really demonstrate the scalability. Speaking of shipping and the real heavy industry, after closing Series B last year in 2023, we've been actively working on building, really, the world's 1st 100% ammonia powered vessel, which we are actively working on today.

And we are now getting close to the final commissioning phase of this vessel, which is the tugboat that we are going to demonstrate probably in the summer 2024. So we will demonstrate the first ammonia power zero carbon vessel ourselves in the summer. But that's really the beginning of our introduction of technology into commercial shipping. For example, we recently announced the Koflov partnership, then also commercial deals with our olli customers. One of the customers, called Hanhwa Ocean.

Hanha Ocean used to be DSME world third largest shipyard based in Korea, where they are building probably the first ammonia powered ammonia carrier, where we are going to provide our technology as the primary proposal. So, looking at the next couple of years, the company is really transitioning from the R and D and demo phase to commercial pilot phase, which we are very much excited about. And do you view the business as being that of IP licensing, or are you producing powertrains for these ships? We envision energy will likely be doing both of these different strategies in the beginning, probably for the first four to five years, because, first of all, we ourselves want to, of course, demonstrate the technology working for the vessel, but also want to demonstrate that this technology is very much manufacturable. So that's what we are essentially going through in our very first manufacturing site, which we started building in Houston.

It's our first manufacturing in Houston to be available towards the end of this year, we'll be manufacturing the first few units, probably first tens of units and hundreds of units, so that we can demonstrate the manufacturability. But in the longer term, we have really great manufacturing resources, especially in the shipping, such as global shipyard, that we already started working together. So the technology licensing is certainly an option that we are actively discussing with our partners. And do you see the company playing a role in the green ammonia value chain in the future as well? Helping to incentivize more production of green ammonia somehow, 100%.

So people talk a lot about the chicken problems in heavy industries. Even if you have large scale of the green hydrogen or green ammonia, where's the use case? So that's the question that people want to have the answer on. So we are providing that answer to the industry that once we have the large scale green or blue ammonia, our technology can easily take those ammonia as a fuel and generate the power at the larger scale. So we will be accelerating the production and also adoption of the green and blue ammonia in the heavy industry, like the shipping.

We already have partnerships with ammonia production companies as well, such as Yara, one of the largest ammonia producers, especially in Norway. They are actually providing green ammonia how did their first green ammonia to our tugboat project? So that we can demonstrate the green ammonia power tugboat in the summer, where we are using those partnerships so that we can work together for our customers, so that they can enable wealth to wealthy carbonization from the beginning. I mean, to some extent, your adoption of your technology, from amogy's perspective, it doesn't really matter if it's green ammonia or it's ammonia produced using steam methane reformation your hope. And it sounds like you're banking on the fact that the customers adopting your ships are doing so because they want a low carbon fuel source powering their ships anyway, and thus are likely to do it if they see a pathway to using green ammonia to fuel these ships.

Exactly right. Our customers care because the primary reason of using ammonia as a fuel is to truly reduce the emission and truly reach the net zero. It's not just our customer. We also care about that a lot as well. That's why from early days, companies started partnering with a company like Yarva or Saudi Aramco, which already produced blue ammonia expertise Japan and other companies in the US, such as LSB Industries, because we also believe our technology has to be run by green ammonia or blue ammonia to give the benefit that we are intending to achieve together.

Jason Jacobs
Where do you need help for those listening who are excited by what you're doing, are you looking for partnerships with other shipping lines? Are you looking for help from ports? Are you looking for help on the supply chain, on the hydrogen side? Where are the areas where you're looking for the most support? Right now, we are looking for every one of them.

Seonghoon Woo
You just mentioned. As we are building this industry using a model as a fuel, we are also realizing that it needs a lot more collaboration, it needs a lot more initiative between many different stakeholders in the industry, across the value chain, from the regulator and fuel producers, and also technology companies like ours, and infrastructure builders, of course, finance and support from project financiers and things like that. What we want to achieve over the course of next really two years, three years, as we really start commercially using our technology and the commercial shipping and commercial power generation, is to having more partners, more committed and interested partners working together, so that we can truly make the transition in this heavy industry in the very short period of the time, in the next 25 years. One of the reasons I was excited to have you on today is there's obviously so much discussion about the green hydrogen economy, and the big question everyone asks is, where's the demand? What's the use case for it and I think having you on here and able to describe how you envision the ammonia revolution from a fuel source perspective, powering ships ultimately depends on the green hydrogen transition taking place.

Jason Jacobs
I appreciate you coming on here and helping me learn more about it and helping our audience also understand what one of the potential pathways could be for being a large scale consumer of this green hydrogen that's getting so much attention right now. I appreciate that. Appreciate the opportunity as well, from our perspective. From my perspective, shipping is really the beginning of the use case of the ammonia scale. A lot of countries like Japan and Korea, as I mentioned briefly, they started using ammonia to generate the power at the utility scale.

Seonghoon Woo
Japan and Jira, local companies, started producing power using ammonia, coal combustion, and eventually the ammonia combustion with the necessary emission reduction measures so that they can produce the power of the gigalith scale. So once we start deploying ammonia for that power generation to really power those countries, the demand and deployment of the ammonia pk backing on the green hydrogen is going to be even much more scaled very quickly. So it will be coming. It will be coming very quickly, and we are excited to be part of that transition journey. You just got my gears really turning on that.

Jason Jacobs
Obviously, in general, we all want every country to move off of fossil fuels as rapidly as possible. But in particular, countries who don't have an endemic natural gas industry, if they can stop importing natural gas and can figure out how to use local fuel sources that they can produce on their own, that are low emissions, that could rapidly change the energy makeup in those countries. Thinking of green hydrogen feeding ammonia as a potential power plant fuel source is a really good insight that I hadn't considered before. That's right. But that actually started happening already from 2024 in some countries, again, like east asian countries mainly.

Seonghoon Woo
But we see that to be rapidly expanded and deployed global scale as well. That is why our view on ammonia adoption to the multi heavy industries even more bullish. And in those use cases, in your opinion, it still would not be combusting the ammonia, it would be cracking the ammonia into hydrogen and running those as large hydrogen fuel cell power plants. Is that what you envision? So we envision both combustion and the fuel cell.

Of course, fuel cell is exciting because it's zero emission and also you can deploy the fuel cell using the commercial fuel cells. But producing like the gigawatt scale of the power will likely require the combustion. However, you can also think about in the way that if you want to combust hydrogen, the hydrogen turbine hydrogen combustion, which is already existing. But if you think about the required hydrogen quantity to reach gigawatt scaled energy production, then storing, transporting that much of hydrogen is going to be very challenging. So we already started working, especially with our east asian shareholders such as Mitsubishi innovation in the projects where we only deploy this cracking piece.

Forget about the fuel cell, but this cracking piece enables them to use low cost fuel, which is ammonia, but still run this power plant using hydrogen combustion engine or hydrogen turbine. So that's another huge opportunity where our technology provides through technical and also the commercial benefits. Thank you so much for sharing all this with us. Anything else I should have asked you today? No, I mean, thank you for asking those questions to me.

And hopefully the conversation was not too technical or too specific on certain areas for the broader audiences. But still, I mean, our website and our company and the resources like LinkedIn has a lot of information because we also published a few white papers about the role of the ammonia, how we see that. So hopefully people can visit our website as well to find them out. Seonghoon, thanks so much for joining us today. Thank you for having me today.

Jason Jacobs
Thanks again for joining us on the Mystery Climate Journey podcast at MCJ Collective. We're all about powering collective innovation for climate solutions by breaking down silos and unleashing problem solving capacity. If you'd like to learn more about MCJ Collective, visit us@mcjcollective.com and if you have a guest suggestion, let us know that via Twitter McJpod for weekly climate. Jobs, community events and investment announcements from our MCJ venture funds, be sure to subscribe to our newsletter on our website. Thanks and see you next episode.

Yin Liu
Thanks and see you next episode.

Jason Jacobs
Thanks and see you next episode.