Air Products announced June 30 that it will not move forward with its Louisiana Clean Energy Complex (LCEC), citing expected financial returns that did not meet the company's investment criteria.

According to Air Products, the decision will result in pre-tax charges of up to $2.9 billion during its fiscal third quarter, primarily related to asset write-downs and the termination of contractual commitments associated with the project.

The $4.5 billion blue hydrogen project was first announced in October 2021, with plans to produce more than 750 million standard cubic feet per day of blue hydrogen. At the time of the announcement, the company expected the site in Ascension Parish to be operational by this year.

The company also said it will discontinue development of a zero-carbon liquid hydrogen facility in Casa Grande, Arizona, along with several smaller clean energy distribution projects. Air Products attributed the decisions to challenging commercial conditions, project-specific economics and slower-than-expected growth in hydrogen mobility markets. The company said it plans to redeploy equipment where possible and reduce existing contractual obligations.

The Louisiana announcement follows additional project cancellations announced earlier this year. In February, Air Products canceled three U.S. projects, including a green liquid hydrogen facility in New York, a sustainable aviation fuel expansion project in California and a carbon monoxide production project in Texas. At the time, the company said the moves were intended to streamline its project backlog and focus resources on investments expected to generate stronger shareholder returns.

Air Products said it remains committed to its Louisiana operations, where it operates 18 industrial gas facilities and the world's largest hydrogen pipeline network serving refinery customers along the U.S. Gulf Coast.

Separately, the company announced it is finalizing a marketing and distribution agreement with Yara International for renewable ammonia produced at the NEOM Green Hydrogen Project in Saudi Arabia. The agreement is independent of the Louisiana project cancellation and will allow Yara to market and distribute renewable ammonia produced at the facility through its global logistics network. Air Products is the sole offtaker for up to 1.2 million metric tons of renewable ammonia annually from the project, which the company previously said is more than 90% complete and remains on track to begin commercial production in 2027.

More recently, Air Products opened a $70 million expanded Membrane Solutions manufacturing and logistics facility in Maryland Heights, Missouri, increasing production capacity for gas separation systems used in biogas upgrading, hydrogen recovery, aerospace and marine applications. According to the company, the project added more than 70 jobs and supports growing demand for industrial gas separation technologies.