Atome Energy PLC (AIM:ATOM) has struck a pair of deals with the aviation and river-shipping industries in Paraguay to work on supplying its future hydrogen to help decarbonisation efforts.
The AIM-listed company, which is developing green hydrogen and ammonia production facilities in two areas of Paraguay, said it has signed the two memoranda of understanding (MoU) just as the government holds the Invest in Paraguay conference in association with the Inter-American Development Bank and at which Atome's chairman, Peter Levine, is speaking.
For the first agreement, Atome said it was approached by the National Civil Aviation Authority of Paraguay (DINAC), which owns and manages the country’s airports as well as the National University of Asunción (UNA), to help in cutting carbon emissions for the local aviation industry’s groundside and airside operations.
Under the MoU that has been signed, Atome said it, DINAC and UNA have agreed to work together to identify potential use of the company's green hydrogen and ammonia products in Paraguay’s airports as well as co-operation on research projects and educational events promoting the benefits of the green fuels produced by the company.
The second MoU, with the Paraguay River and Maritime Shipowners Centre (CAFYM), covers collaboration on examining how the third largest barge fleet in the world can substitute diesel imports with domestically produced green fuels such as hydrogen, methanol or ammonia, as well as converting existing engines to use green fuel wholly or partially.
Atome noted that green ammonia is the only fuel with 100% zero emissions to fulfil the International Maritime Organisation's (IMO) aim of materially reducing carbon emissions: https://royalsociety.org/news/2020/02/green-ammonia-report/
As Paraguay is landlocked, its river logistics are an essential part of the Mercosur region and a vital link for the country to access international export markets.
The Paraguay-Paraná waterway, connecting Argentina, Brazil, Bolivia, Paraguay, and Uruguay, transported over 22 million tonnes of goods in 2019 and trade on the waters is now forecast to double by 2030.
“Whilst e-fuels in aviation is a long-term project, ammonia maritime engines are currently under development by major manufacturers such as MAN and Wartsila and expected to come to market as early as 2025, at which time Atome will have started increasing production from its first projects,” said Atome's chairman Levine in a statement.
He added that the agreements “demonstrate the active interest being shown for Atome's future production and the medium to long-term demand potential as the world out of necessity seeks to replace reliance on fossil fuels in diverse areas of industry”.