Irish developer Mainstream Renewable Power (MRP) and Norway’s Aker Clean Hydrogen (ACH) have inked a letter of intent to develop green hydrogen and ammonia production facilities in Chile.

The LoI will look at using wind and solar power output from MRP’s project portfolio in the country, which includes the giant Andes Renovables mega-development currently in construction, as the basis for up-to 1GW of generating capacity of the two gases in the South American country.

“Hydrogen will play a vital role in accelerating decarbonisation, as it has the potential to significantly cut CO2 emissions by replacing fossil fuel through clean hydrogen and ammonia production and reduce the carbon footprint of industry users,” said Kristian Røkke, CEO of ACH-owner Aker Horizons, which recently became the majority shareholder in MRP.

MRP’s CEO Mary Quaney stated: “This announcement is a very good example of what we can achieve together with our new strategic partner, Aker Horizons and moves Mainstream’s ambition beyond pureplay renewables generation to being a facilitator of the decarbonisation of other industries.”

Manuel Tagle, Mainstream’s CEO for Latin America, added: “With its excellent wind and solar resources and technological know-how, Chile has the potential to lead the world in the production of the world’s most cost efficient green hydrogen.”

Chile has a stated ambition to produce “the most cost-efficient green hydrogen in the world” by 2030, with the green ammonia being used by “industrial end-users” in South America, and exported to other international markets.

Juan Carlos Jobet, Chile’s minister of energy and mining, said: “Chile’s potential to become leaders in the production and export of green hydrogen, green ammonia and synthetic fuels will be key for the decarbonisation of Chile and the planet, especially in hard-to-abate sectors, such as industry, heavy-duty transport, and maritime transportation.

“Our national green hydrogen strategy is beginning to be implemented to translate our vast renewable resource potential into competitive clean energy investment.”

Chile’s renewable energy association Acera has said that it expects the country’s renewable energy capacity could leap by more than 50% by 2021 to 10GW, with the country now expecting to pass its target of having clean-energy meet 20% of national demand five years ahead of its original 2025 target.

The rapid expansion of wind and solar power in Chile is on track to see the country drawing 70% of its power from renewable sources by 2050, according to the trade group.