TOKYO -- Major Japanese shipping company NYK Line, power producer JERA and five other corporations including shipbuilders announced on Tuesday that they will work together to promote the adoption of ammonia-fueled vessels, aiming to decarbonize maritime transportation.

"We saw significant potential in ammonia as a leading option for next-generation fuels, both in terms of its potential for large-scale production and the development of supply networks," Takaya Soga, NYK Line's president, said at a news conference on Tuesday.

"By bringing together the technologies, expertise and infrastructure developed across the shipbuilding, energy and shipping [sectors], we aim to work as one to put ammonia into practical use and establish a safe and sustainable business model," he added.

Besides NYK Line and JERA, the others involved are shipping company Kawasaki Kisen Kaisha, as well as major shipbuilders Shin Kurushima Dockyard, Kyokuyo Shipyard, Imabari Shipbuilding and its subsidiary Nihon Shipyard.

NYK and Kawasaki Kisen will order four car carriers from Shin Kurushima Dockyard and Nihon Shipyard, which are scheduled to be completed by fiscal 2030. JERA will supply ammonia sourced from India to the car carriers from its Hekinan Thermal Power Station through a dedicated bunkering vessel made by Kyokuyo Shipyard.

Heavy fuel oil remains the primary source for large vessels, but the International Maritime Organization aims to achieve net-zero carbon dioxide emissions in international shipping by 2050.

Ammonia is seen as one of the next-generation marine fuels that could help reduce CO2 emissions along with hydrogen and methanol. Widely used in fertilizer production and other industrial applications, ammonia does not emit carbon dioxide when burned.

However, the fuel supply chain remains an obstacle to the adoption of next-generation fuel vessels. Even if shipowners purchase vessels that run on a particular alternative fuel, they cannot operate unless the fuel is available at ports of call. Another challenge is bringing down the costs of alternative fuels, which are currently higher than those of heavy fuel oil.

riers primarily operate on routes connecting export ports near automobile manufacturing plants with major export destinations. Compared with those of bulk carriers, which transport iron ore, coal and grain, their routes and ports of call tend to be more fixed and predictable, making it easier to adopt next-generation fuel-powered vessels despite limited fuel supply infrastructure.

For shipbuilders, receiving a consolidated order from the two shipping companies allows them to build ships more efficiently as they do not need to modify ship specifications and designs for each client.

JERA is building an ammonia supply chain as it seeks to use the chemical compound as a fuel for power generation. The power producer is constructing four liquid ammonia storage tanks at the Hekinan Thermal Power Station, Japan's largest coal-fired power plant.

The company plans to begin commercial coal-ammonia co-firing in fiscal 2029, initially replacing 20% of the coal with ammonia and later raising the share to 50%, with the goal of eventually phasing out the fossil fuel altogether. The company expects wider use of ammonia as a marine fuel could help lower procurement costs.

Shipbuilding is one of 17 sectors prioritized for investment under the ambitious growth strategy mapped out by Prime Minister Sanae Takaichi. The government aims to double domestic shipbuilding volume by 2035 through public and private sector investments totaling around 1 trillion yen ($6.3 billion).