GreenH2 Fertiliser — Business Model
The diversified five-stream revenue model, the unit economics and the value capture underpinning GreenH2.
Section 6 · Business Plan
Business Model
The diversified five-stream revenue model, the unit economics and the value capture underpinning GreenH2.
GreenH2 operates an integrated, asset-heavy production model: it
converts locally sourced feedstock and renewable power into high-value
nitrogen products and energy-transition commodities, sold under a mix of
long-term offtake contracts and spot arrangements. Value is captured
across the chain — from molecule to delivered product — and protected by
carbon-capture economics that turn a regulatory cost into a revenue and
differentiation advantage.
6.1 Revenue streams
| Stream | Share | Basis |
|---|---|---|
| Urea fertiliser | ~37% | Volume × price; co-operative and distributor offtake plus spot |
| Merchant ammonia | ~27% | Domestic explosives + export-linked pricing |
| Ammonium nitrate | ~23% | Contracted mining-explosives demand |
| Carbon credits | ~7% | Captured CO₂ monetised as credits and tax avoidance |
| Industrial hydrogen | ~6% | Merchant industrial and mobility offtake |
6.2 Cost structure
The cost base is dominated by feedstock and energy (variable, scaling
with output) and by fixed production costs (labour, maintenance,
insurance). Because a large share of cost is fixed, margins expand
markedly as the plant ramps from commissioning to full utilisation — the
central driver of the EBITDA-margin trajectory shown later in this
Plan.
6.3 Margin discipline and assumptions
Blended product margins reflect a mix of commodity-priced fertilisers
and higher-value specialty and export streams. Carbon-credit revenue
carries minimal direct cost of sales and therefore lifts blended margin;
investors should stress-test commodity-price and carbon-price
assumptions independently. The model deliberately recognises first-year
commissioning losses rather than smoothing them.
6.4 Competitive moat
- Local feedstock & power: long-term feedstock
arrangements and on-site solar lower and stabilise input cost relative
to import-parity competitors. - Scale & integration: world-scale, integrated
units capture inter-product synergies (shared ammonia, utilities,
logistics) that sub-scale entrants cannot. - Policy alignment: Strategic Integrated Project
status, carbon-credit eligibility and just-transition positioning create
durable, hard-to-replicate advantages.
Confidential — this business plan is provided to prospective investors and lenders for evaluation purposes only and may not be reproduced or distributed without the written consent of GreenH2 Fertiliser Holdings (Pty) Ltd.