One question we would have concerning the IEA ammonia projections in the charts below is whether the absolute demand assumption for 2050 is too low. If Japan has success co-firing its coal-based facilities with ammonia over the next 6-7 years, we could see a step-change in ammonia demand. The chart likely reflects expectations in Japan, but we would expect other coal-heavy economies to follow Japan's lead. If this were the case, we would expect the share of hydrocarbon-based ammonia to rise with accompanying CCS.
Finally, Larry Fink has recognized the flaw in his aggressive ESG rhetoric. Maybe he knew this all along, but it is good to see him step into the debate in favor of not crippling the fossil fuel industry by denying it access to capital and investors too quickly. However, that boat may have sailed, with investors like Engine No. 1 feeling empowered by their win over ExxonMobil and raising more money as a consequence. We have covered this subject at length in our ESG and climate weekly this week: Big Oil’s Big Problem – Hard To Find A Favorable Scenario – maybe Larry read it!