Air Products and Chemicals Inc. APD and Yara International are in advanced negotiations to partner on large-scale low-emission ammonia projects. Air Products’ Louisiana Clean Energy Complex, a project with an estimated total investment of $8–$9 billion, is designed to produce more than 750 million standard cubic feet per day of low-carbon hydrogen while capturing around 95% of associated CO2 emissions.
Yara would acquire the ammonia production, storage and export assets once the ammonia plant achieves agreed-upon performance levels, representing roughly 25% of the project cost, and enter into a 25-year offtake agreement for about 80% of the hydrogen output, enabling production of up to 2.8 million tons of low-carbon ammonia annually. APD would own and operate the industrial gases production, while Yara will be responsible for related operations and integrating the entire ammonia production into its global distribution network.
The remaining hydrogen would be supplied to the customers of Air Products through its U.S. Gulf Coast pipeline network. The NEOM Green Hydrogen Project in Saudi Arabia, which is more than 90% complete and is expected to supply up to 1.2 million tons per year of renewable ammonia, with Air Products as the sole offtaker and Yara potentially supporting global marketing and distribution.
The companies said final investment decisions for the U.S. project are targeted by mid-2026, subject to issuance of air permits and contractual finalizations, positioning the partnership as a major step toward scaling commercially viable low-emission ammonia for fertilizers and clean-energy applications. Final marketing and distribution agreement for the Saudi Arabia project is targeted for the first half of 2026.
Shares of APD are down 18.6% year to date compared with the industry’s 26.2 % decline.
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APD Zacks Rank & Key Picks
APD currently carries a Zacks Rank of #3 (Hold).
Better-ranked stocks in the Basic Materials space include First Majestic Silver Corp. AG, Hochschild Mining Plc. HCHDF and Croda International Plc. COIHY. AG, HCHDF and COIHY carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) here.
The Zacks Consensus Estimate for AG’s current-year earnings is pegged at 25 cents per share, indicating a 279% year-over-year increase. Shares of AG have soared 124.6% over the past year.
The Zacks Consensus Estimate for HCHDF’s current fiscal-year earnings stands at 36 cents per share, implying a 57% year-over-year increase. Shares of HCHDF have surged 100.7% over the past year.
The Zacks Consensus Estimate for COIHY’s current fiscal-year earnings is pegged at 95 cents per share, indicating a 4.4% year-over-year increase. Shares of COIHY have lost 17.6% over the past year.
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This article originally published on Zacks Investment Research (zacks.com).
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