Petronas Energy Canada has cooperated with Japan’s Itochu to study the feasibility of producing around 1 million tons per year of ammonia, combining hydrogen and nitrogen, Financial Post reported.

The study focuses on establishing a $1.3 billion petrochemical plant to produce hydrogen that will be exported to the Asian market.

The two companies aim to capture the carbon emitted in the production process.

“Ammonia is a very efficient means for the transportation of hydrogen,” Mark Fitzgerald, Petronas Energy Canada president and CEO, said.

The hydrogen used in the process will be provided from Petronas’ natural gas projects, located in the northeast British Columbia

“At the endpoint, the user, which in this case would be markets overseas, would split it into nitrogen and then hydrogen, which would be used as a fuel source,” Fitzgerald noted, adding that the project would capture the associated emitted carbon, which makes it “blue ammonia” or “blue hydrogen”.