Singapore-based Sembcorp is close to finalising an offtake agreement with Japan’s Kyushu Electric Power for its planned green hydrogen facility at V.O. Chidambaranar (VOC) Port in Thoothukudi. Spread across 160 acres, the project is designed to produce two lakh tonnes of green ammonia annually, with first output targeted for 2029. “The execution of the project will commence once the agreement is signed,” VOC port chairman Susanta Kumar Purohit said.

The initiative is being positioned as a trilateral clean energy partnership between India, Singapore, and Japan. Under the plan, Sembcorp will convert green hydrogen into ammonia, with Kyushu Electric Power committing to purchase the fuel as a partial substitute for coal in its thermal plants. Sojitz Corporation will act as intermediary, while NYK Line will oversee maritime transport. A preliminary Heads of Terms agreement has already been signed among the four companies.

Despite the high-profile launch by Chief Minister M.K. Stalin nearly a year ago, progress on the ground has been limited. Apart from a small pilot project at the port, Thoothukudi’s broader green hydrogen ecosystem has yet to fully take shape. Other large-scale ventures in Tamil Nadu have also seen slow movement. ACME Green Hydrogen and Chemicals announced a project with a planned capacity of 1.5 million tonnes of green ammonia annually in 2022, but it has yet to advance. Petronas had also outlined plans for a significant project, though developments remain pending.

Analysts highlight cost as the key hurdle. Green hydrogen remains far more expensive than fossil fuels or even “grey hydrogen” derived from natural gas. Production requires abundant renewable power, large volumes of water, and costly catalysts such as platinum, while transport and storage add further expense.

Still, Tamil Nadu continues to push for investment. Hyundai Motor India, in partnership with IIT Madras and the state government, has announced an Rs 180-crore HTWO Innovation Centre at IIT-M’s Discovery Campus near Chennai. Due to open within two years, the R&D hub will focus on building indigenous hydrogen technologies. “This is a crucial step towards building domestic hydrogen capability,” Industries Minister T.R.B. Rajaa said.

If executed as planned, Sembcorp’s VOC Port project could emerge as one of India’s first large-scale operational hydrogen-to-ammonia ventures, creating export opportunities and supporting regional decarbonisation.

Source:

https://www.newindianexpress.com/states/tamil-nadu/2025/Sep/05/sembcorp-closing-in-on-offtake-deal-for-rs-36k-crore-green-hydrogen-project-at-voc-port