The Danish energy company Ørsted has cancelled the construction of an e-methanol plant in northern Sweden due to low market demand. This was reported in the company's first-half 2024 financial report.

E-methanol is a synthetic fuel produced through a catalytic reaction between green hydrogen and carbon dioxide. It is characterised by its low carbon footprint and its potential to serve as an alternative to petroleum-based fuels.

The final investment decision for the FlagshipONE project was made in December 2022, with plans to launch the plant in 2025. The facility was expected to have a production capacity of 55,000 tonnes of green methanol per year upon completion.

Ørsted explained its decision to abandon the project was due to the inability to secure long-term contracts for the sale of e-methanol, along with higher-than-expected costs. The company will now focus on developing green hydrogen production instead.

The FlagshipONE plant was set to become the largest e-methanol production facility in Europe and could have been part of a programme to decarbonise maritime transport. This cancellation of the project resulted in write-off losses amounting to $221 million.

Ørsted Group President and CEO Mads Nipper stated in December 2022 that the world urgently needs ambitious green energy projects to combat climate change, decarbonise hard-to-electrify sectors, and ensure regional energy independence. Back then, he emphasised that Ørsted was ready to lead the green transformation of society by creating innovative projects like FlagshipONE.

Source: Arctic Century

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