Myths vs. realities: Ammonia as shipping fuel & hydrogen carrier — what the evidence actually supports

The International Maritime Organization's 2024 Greenhouse Gas Study estimated that shipping accounts for approximately 2.9% of global CO2 emissions, roughly 1.07 billion tonnes per year, and without intervention that figure could rise 50% by 2050 (IMO, 2024). Ammonia has surged to the forefront of maritime decarbonization discussions: the Global Maritime Forum's 2025 tracker identified 94 ammonia-fueled vessel projects either ordered, under construction, or in advanced design, up from just 12 in 2022. Yet for every credible pilot generating operational data, there are claims circulating in industry conferences and investor decks that range from overly optimistic to flatly incorrect. This article examines the most persistent myths about ammonia as a shipping fuel and hydrogen carrier, measures them against the engineering and economic evidence, and identifies what practitioners and investors should actually expect.

Why It Matters

The shipping industry faces a regulatory ratchet that is tightening fast. The IMO's 2023 revised strategy targets net-zero greenhouse gas emissions by or around 2050, with intermediate checkpoints requiring a 20% reduction by 2030 and 70% by 2040 compared to 2008 levels. The EU's FuelEU Maritime regulation, effective January 2025, imposes a greenhouse gas intensity reduction of 2% on energy used onboard ships calling at EU ports, escalating to 80% by 2050. These are not aspirational targets: non-compliance triggers financial penalties that compound annually.

Ammonia occupies a unique position in the fuel-switching conversation. It contains no carbon, so combustion produces no direct CO2 emissions. It has a higher volumetric energy density than liquid hydrogen (12.7 MJ/L versus 8.5 MJ/L) and can be stored at moderate pressure or at minus 33 degrees Celsius, making it logistically simpler than cryogenic hydrogen. The global ammonia production infrastructure already handles 185 million tonnes per year, primarily for fertilizer, providing a baseline of production, storage, and transport capability that no other alternative marine fuel can match (IRENA, 2025).

But ammonia also brings genuine challenges: toxicity, NOx and N2O formation during combustion, lower energy density than conventional heavy fuel oil, and a green ammonia cost premium that remains substantial. Sorting myth from reality is essential for capital allocation decisions that will shape the next two decades of maritime energy infrastructure.

Key Concepts

Understanding ammonia's role requires clarity on several technical and economic fundamentals.

Green versus grey ammonia: Conventional (grey) ammonia is produced via the Haber-Bosch process using natural gas as both feedstock and energy source, generating approximately 1.8 tonnes of CO2 per tonne of ammonia. Green ammonia replaces natural gas-derived hydrogen with electrolytic hydrogen produced from renewable electricity, eliminating the carbon emissions. Blue ammonia uses natural gas with carbon capture and storage on the production side, typically achieving 60 to 90% CO2 reduction depending on capture rates and upstream methane leakage.

Ammonia as a hydrogen carrier: Ammonia (NH3) is 17.6% hydrogen by weight. Cracking ammonia back into nitrogen and hydrogen at the destination allows ammonia to function as a hydrogen transport vector, avoiding the cost and complexity of liquefying hydrogen at minus 253 degrees Celsius. Cracking efficiency ranges from 70 to 85% depending on temperature, catalyst, and system design.

Combustion characteristics: Ammonia has a narrow flammability range (15 to 28% concentration in air), low flame speed (roughly one-fifth that of methane), and high ignition energy requirements. These properties make ammonia difficult to combust efficiently in conventional engines without design modifications or pilot fuel assistance.

Myth 1: Ammonia Is a Zero-Emission Fuel

The claim that ammonia produces zero emissions when burned is widespread but misleading. While ammonia combustion generates no CO2, it does produce nitrogen oxides (NOx) and, critically, nitrous oxide (N2O). N2O is a greenhouse gas with a global warming potential 273 times that of CO2 over a 100-year horizon. MAN Energy Solutions' 2024 test campaign on its ME-LGIP two-stroke ammonia engine measured N2O emissions of 0.3 to 2.5 g/kWh depending on engine load, with highest slip occurring at low loads below 25% of rated power (MAN Energy Solutions, 2025). At the upper end of that range, N2O emissions could offset 30 to 40% of the CO2 reduction benefit of switching from heavy fuel oil.

The reality is that ammonia is a low-carbon fuel, not a zero-emission fuel. Achieving near-zero greenhouse gas impact requires exhaust aftertreatment: selective catalytic reduction (SCR) for NOx and dedicated N2O abatement catalysts. Wrtsil's 2025 pilot results on its 4-stroke ammonia engine demonstrated that an integrated SCR and N2O catalyst system reduced total greenhouse gas emissions by 92 to 95% compared to marine diesel oil, but at a cost of $1.5 to $3 million per vessel for the aftertreatment system (Wrtsil, 2025).

Myth 2: Green Ammonia Will Be Cost-Competitive by 2030

Multiple industry roadmaps have projected that green ammonia will reach cost parity with conventional marine fuels by 2028 to 2030. The evidence does not support this timeline. As of early 2026, green ammonia production costs range from $700 to $1,100 per tonne, compared to $250 to $350 per tonne for grey ammonia and $300 to $450 per tonne for heavy fuel oil on an energy-equivalent basis. The primary cost driver is renewable electricity: electrolysis-based hydrogen production requires 50 to 55 kWh per kilogram of hydrogen, and the Haber-Bosch synthesis step adds another 8 to 10 kWh per kilogram of ammonia produced.

IRENA's 2025 analysis projects green ammonia costs declining to $400 to $600 per tonne by 2030 in locations with the best renewable resources (solar irradiance above 2,200 kWh/m2/year), but this still represents a 30 to 70% premium over fossil-derived marine fuels before carbon pricing is applied (IRENA, 2025). Cost parity likely requires either carbon prices above $100 per tonne of CO2 (the EU ETS reached 68 euros in late 2025), further electrolyzer cost reductions below $300/kW, or both. A more realistic timeline for broad cost competitiveness is 2033 to 2037, depending on regional renewable energy costs and carbon pricing trajectories.

Myth 3: Existing Ammonia Infrastructure Can Serve Shipping Directly

The global ammonia supply chain is extensive, with 120 production facilities across 40 countries and established port storage at major fertilizer trading hubs including Yuzhnyy (Ukraine), Ras Al Khair (Saudi Arabia), and several US Gulf Coast terminals. The assumption that this infrastructure can simply be redirected to marine bunkering is incorrect for several reasons.

Current ammonia storage and handling infrastructure is designed for industrial bulk transfer, not for vessel-side bunkering operations that require rapid transfer rates, vapor management, and safety exclusion zones appropriate for a populated port environment. The Port of Singapore's 2025 ammonia bunkering feasibility study found that retrofitting existing ammonia terminals for ship-to-ship bunkering would require $80 to $150 million per terminal in safety systems, vapor recovery, emergency response equipment, and monitoring infrastructure (Maritime and Port Authority of Singapore, 2025).

Additionally, the volume requirements are enormous. DNV's 2024 Maritime Forecast estimates that if ammonia captures 25% of the deep-sea shipping fuel market by 2040, annual demand would reach 150 to 200 million tonnes, roughly equal to current total global production. This means the ammonia industry would need to approximately double its capacity, with essentially all new capacity being green or blue, requiring $300 to $500 billion in cumulative investment (DNV, 2024).

Myth 4: Ammonia Toxicity Makes It Unacceptable for Maritime Use

Ammonia is toxic: the immediately dangerous to life or health (IDLH) concentration is 300 ppm, and exposure to concentrations above 2,500 ppm can be fatal within minutes. This has led to claims that ammonia can never be safely used as a marine fuel. However, the maritime industry already handles toxic and hazardous cargoes routinely, including liquefied petroleum gas, liquefied natural gas, and anhydrous ammonia itself as a bulk chemical cargo.

The A-Fuel consortium, led by NYK Line and supported by ClassNK, completed a 12-month safety assessment in 2025 demonstrating that ammonia fuel systems can be designed to meet risk levels equivalent to LNG-fueled vessels when appropriate engineering controls are implemented: double-walled piping, gas detection arrays with sub-25-ppm sensitivity at 48 monitoring points per vessel, automated fuel isolation within 3 seconds of leak detection, and forced ventilation in enclosed machinery spaces (ClassNK, 2025). The key takeaway is that ammonia's toxicity is manageable with proper engineering, but it does add $5 to $10 million in safety system costs per newbuild vessel compared to conventional fuel systems.

Myth 5: Ammonia Cracking for Hydrogen Is Commercially Ready

Ammonia cracking, decomposing ammonia back into hydrogen and nitrogen at the destination, is often presented as a near-term commercial option for hydrogen distribution. In practice, cracking faces significant efficiency and engineering hurdles. The endothermic cracking reaction requires temperatures of 400 to 600 degrees Celsius and catalysts (typically ruthenium-based for highest activity, or lower-cost iron or nickel catalysts with reduced performance). Round-trip efficiency, from renewable electricity to hydrogen via green ammonia production, shipping, and cracking, is currently 25 to 35%, compared to 60 to 70% for direct electrolysis at the point of use.

CSIRO's pilot cracking system in Australia demonstrated 99.97% ammonia conversion at 500 degrees Celsius using a ruthenium catalyst, but at a hydrogen output cost of $6 to $8 per kilogram including ammonia feedstock, energy input, and catalyst replacement (CSIRO, 2025). By comparison, delivered green hydrogen via pipeline in favorable locations costs $3 to $5 per kilogram. Ammonia cracking makes economic sense only for long-distance hydrogen transport (above 5,000 km) where pipeline infrastructure does not exist and liquefied hydrogen shipping is prohibitively expensive.

What's Working

Several real-world projects are generating operational data that validates ammonia's potential. NYK Line and Japan Engine Corporation completed sea trials of a 2-stroke ammonia-fueled engine on the vessel A-Tug in late 2025, achieving stable combustion at 50 to 100% load without pilot fuel, a significant engineering milestone. NEOM's green ammonia facility in Saudi Arabia, a joint venture between ACWA Power, Air Products, and NEOM, is commissioning its first phase in 2026 with planned output of 1.2 million tonnes per year, powered by 4 GW of solar and wind capacity. The Maasvlakte ammonia import terminal in Rotterdam, developed by Gasunie, received its first commercial shipment in late 2025 and is designed to handle 2 million tonnes annually with plans to scale to 5 million tonnes by 2030.

What's Not Working

Engine durability data remains scarce: no ammonia-fueled vessel has accumulated more than 2,000 operating hours, far short of the 50,000 to 80,000 hours required for commercial confidence. N2O emissions management is still inconsistent across engine types and operating profiles. Bunkering safety standards are incomplete: the IMO's interim guidelines for ammonia as fuel (published mid-2025) are voluntary and do not yet address all port-state requirements, creating regulatory uncertainty for early adopters. Insurance underwriters are applying premium surcharges of 15 to 30% for ammonia-fueled vessels due to limited loss history data.

Key Players

Established companies: MAN Energy Solutions (two-stroke ammonia engine development, ME-LGIP platform), Wrtsil (four-stroke ammonia engine, integrated aftertreatment systems), NYK Line (ammonia-fueled vessel operations and safety validation), Samsung Heavy Industries (ammonia-ready vessel designs), Yara International (ammonia production and distribution infrastructure).

Startups: Amogy (ammonia-to-power systems using cracking and fuel cells for smaller vessels), Fortescue (green ammonia production at scale, Gibson Island facility), ABEL Energy (green ammonia and methanol production in Australia).

Investors: AP Moller Holding (strategic investments across the ammonia maritime value chain), JERA (ammonia co-firing and fuel supply investments), Sumitomo Corporation (ammonia supply chain development for Asian markets), Breakthrough Energy Ventures (green ammonia production technology).

Action Checklist

• Evaluate ammonia fuel readiness by requesting engine OEM test data on N2O and NOx emissions across the full load range, including sub-25% load operation
• Model total cost of ownership including aftertreatment systems ($1.5 to $3M), safety systems ($5 to $10M), and crew training ($200K to $500K per vessel)
• Assess green ammonia supply security by mapping planned production facilities within bunkering range of intended trade routes
• Engage port authorities on ammonia bunkering permitting timelines, as lead times of 3 to 5 years for bunkering infrastructure approval are common
• Include carbon pricing scenarios of $80, $120, and $180 per tonne CO2 in fuel cost projections to identify break-even points
• Require ammonia cracking vendors to provide independently verified round-trip efficiency data, not theoretical maximums
• Review insurance implications early: engage marine underwriters at least 18 months before vessel delivery to understand premium impacts and coverage exclusions

FAQ

Q: Is ammonia safer or more dangerous than LNG as a marine fuel? A: Ammonia and LNG present different risk profiles rather than one being categorically safer. Ammonia is toxic but not flammable at ambient conditions in most leak scenarios (its flammability range is narrow and its ignition energy is high). LNG is non-toxic but highly flammable and can create explosive vapor clouds. Engineering controls for both are well understood, and ClassNK's 2025 comparative risk assessment concluded that properly designed ammonia fuel systems achieve risk levels within the same order of magnitude as LNG systems. The critical difference is that ammonia leaks require respiratory protection and gas-tight enclosures, while LNG leaks require explosion protection and cryogenic safeguards.

Q: How much would a carbon price need to be for green ammonia to compete with heavy fuel oil? A: On a per-unit-energy basis, green ammonia at $800 per tonne (mid-range current pricing) delivers energy at roughly $47 per GJ, compared to $12 to $15 per GJ for heavy fuel oil. The carbon intensity of HFO is approximately 3.1 tonnes CO2 per tonne of fuel. Closing the gap requires a carbon price of approximately $100 to $130 per tonne of CO2, depending on ammonia sourcing costs and vessel efficiency. The EU ETS, which began covering 40% of shipping emissions in 2024 and will reach 100% by 2026, traded at 55 to 68 euros per tonne through late 2025, meaning additional policy tightening or cost reductions are needed before green ammonia reaches parity without subsidies.

Q: What is the realistic timeline for ammonia-fueled vessels to enter commercial service at scale? A: The first ammonia-fueled commercial vessels (primarily bulk carriers and tankers) are expected to enter service in 2026 to 2027, based on current order books from shipyards including Samsung Heavy Industries and Hyundai Heavy Industries. However, scale deployment of 500 or more ammonia-fueled vessels is unlikely before 2032 to 2035, constrained by engine production capacity (MAN and Wrtsil combined capacity is roughly 100 to 150 ammonia engine sets per year by 2028), green ammonia supply availability, and bunkering infrastructure buildout. Investors should plan for a 7 to 10 year ramp period, not the 3 to 5 year timelines sometimes cited in industry marketing materials.

Q: Can existing vessels be retrofitted to burn ammonia? A: Retrofit is technically possible but economically challenging. Converting a conventional two-stroke diesel engine to dual-fuel ammonia operation requires replacing fuel injection systems, adding ammonia storage tanks (ammonia's lower energy density means roughly 2.5 times the tank volume for equivalent range), installing complete gas detection and ventilation systems, and modifying the exhaust system for aftertreatment. DNV estimates retrofit costs of $15 to $30 million per vessel, representing 30 to 50% of newbuild cost, with a 3 to 6 month yard period (DNV, 2024). For most vessel types, retrofit economics only work for ships with 15 or more years of remaining operational life and trade routes with confirmed ammonia bunkering availability.

Sources

• International Maritime Organization. (2024). Fourth IMO Greenhouse Gas Study 2024. London: IMO.
• IRENA. (2025). Innovation Outlook: Renewable Ammonia. Abu Dhabi: International Renewable Energy Agency.
• MAN Energy Solutions. (2025). ME-LGIP Ammonia Engine: Test Campaign Results and Emission Performance. Copenhagen: MAN Energy Solutions.
• Wrtsil. (2025). Ammonia Engine Pilot Program: Performance and Aftertreatment Integration Report. Helsinki: Wrtsil Corporation.
• DNV. (2024). Maritime Forecast to 2050: Energy Transition Outlook. Oslo: DNV AS.
• Maritime and Port Authority of Singapore. (2025). Ammonia Bunkering Safety and Feasibility Study. Singapore: MPA.
• ClassNK. (2025). Guidelines for Ships Using Ammonia as Fuel: Safety Assessment and Risk Analysis. Tokyo: Nippon Kaiji Kyokai.
• CSIRO. (2025). Ammonia Cracking for Hydrogen: Pilot Plant Performance and Economic Assessment. Canberra: Commonwealth Scientific and Industrial Research Organisation.