Supply Agreement Provides Companies Operational and Environmental Benefits
Air Products (NYSE: APD), the leading global hydrogen provider, today announced the signing of a long-term supply contract with Monsanto Company (NYSE: MON) to build a new world-scale hydrogen production plant to be located at Monsanto's Luling, Louisiana Roundup® facility. The new hydrogen plant is scheduled to be on-stream in January 2012.
Air Products will build a steam methane reformer (SMR) producing over 100 million standard cubic feet per day (MMSCFD) of hydrogen. The SMR will be connected to Air Products' East Gulf Coast pipeline network, which supplies refineries with hydrogen needed to make cleaner burning transportation fuels, in addition to meeting the hydrogen needs of the local petrochemical industry. In addition, the facility will produce additional hydrogen via a clean-up of a hydrogen-rich off-gas feed coming from Monsanto. Monsanto will use steam from Air Products' SMR process to benefit its Roundup® production plant.
"This agreement provides a win-win for Air Products and Monsanto. Air Products adds a world-class SMR facility, which along with our previously announced Garyville and Baton Rouge SMRs, will enhance the reliability of our leading East Gulf Coast hydrogen pipeline system. Monsanto's benefits include a reduction in natural gas used to make steam and an improved outlet for its off-gas stream, which will now be purified and used to make hydrogen," said Wilbur Mok, vice president-North America Tonnage Gases for Air Products.
"This is a relationship with outstanding potential. It will strengthen our own operations and provide important benefits to both our community and industry in the area. It will help us serve our farmer customers in a more environmentally sustainable manner," said Mike Frank, Monsanto's Manufacturing Director-Crop Protection Division.
The Air Products SMR will feature technology advancements to maximize facility energy efficiency and emission reductions. "We have enhanced our SMR design to target minimal loss of heat to the environment, which in turn reduces natural gas usage requirements to make hydrogen. These efforts and other productivity improvements support the company's overall goals of reducing energy consumption and emissions," said Tom Wendahl, manager-Tonnage Gases, East Gulf Coast Area for Air Products.
Air Products' East Gulf Coast hydrogen pipeline system currently reaches more than 175 continuous miles from Baton Rouge to Chalmette, Louisiana. The network has 15 hydrogen production source points feeding the pipeline system, including the recently announced hydrogen plants being built in Garyville and Baton Rouge, which have anticipated on-stream dates of October 2009 and April 2010, respectively. Additionally, in the U.S. Gulf Coast, Air Products has a second and larger hydrogen pipeline system of over 300 miles reaching from the Houston Ship Channel in Texas to Lake Charles, Louisiana.
Air Products also has hydrogen pipeline networks operating around the world in the U.S. in Southern California; in Sarnia, Ontario and Edmonton, Alberta in Canada; and in Rotterdam in The Netherlands.
Air Products' hydrogen facility in Luling will be built through the global alliance between Air Products and Technip. This alliance, which has built over 30 hydrogen production facilities, continues to provide the worldwide refining industry with competitive technology and world-class safety. Technip provides the design and construction expertise for steam reformers while Air Products provides the gas separation technology. Air Products, through its extensive operating network, and Technip, from its large reference base, also bring effective operational and engineering knowledge to "design-in" high reliability and efficiency. The plants are operated and maintained by Air Products under long-term agreements with customers.