Giant first step towards an Egyptian hydrogen hub

Norwegian energy company Scatec has entered into an agreement with ammonia producer Fertiglobe and the Sovereign Fund of Egypt (TSFE) to jointly develop a 50-100MW green hydrogen facility as feedstock for green ammonia production. Image credit: Scatec

Giant first step towards an Egyptian hydrogen hub      

In a significant step towards developing a green hydrogen hub in Egypt, Norwegian energy company Scatec has entered into an agreement with ammonia producer Fertiglobe and the Sovereign Fund of Egypt (TSFE) to jointly develop a 50-100MW green hydrogen facility as feedstock for green ammonia production.

According to the agreement Scatec will build, operate and majority own the facility and a long term off-take agreement will be entered into with Fertiglobe’s subsidiary EBIC.

Fertiglobe is jointly owned by OCI N.V. and Abu Dhabi National Oil Company (ADNOC).

According to Scatec’s CEO Raymond Carlsen, the facility will be located near EBIC in Ain Sokhna. This is the first step towards developing a green hydrogen hub in Egypt,” says Carlsen.

 “We see green hydrogen as a natural part of our strategy and the renewable ecosystem in the years to come,” says Carlsen.

The partnership forms part of Scatec’s strategic initiative “Power to X”. The objective of “Power to X” is to enable industrial projects that contribute to the reduction of carbon emissions through the provision of competitive renewable energy.

According to Carlsen, the ambition is to develop long term partnerships where Scatec can capitalise on its expertise in renewable project development in high growth markets globally.

Renewable technology, long term off-take contracts, equity co-investments and project financing from multilateral finance institutions represent key elements of this strategy.

Giant first step towards an Egyptian hydrogen hub      

Ahmed El-Hoshy, CEO of OCI N.V. says that they will deploy world-leading technology to ramp up the company’s green ammonia production profile and further expand their low-carbon portfolio.

“Fertiglobe is increasingly becoming an ideal springboard to capture the huge growth opportunities offered by the hydrogen economy. The participation of the Sovereign Fund of Egypt underlines Egypt’s commitment to become a global leader in the renewables space,” he says.

Ayman Soliman, CEO of TSFE says that the partnership provides a unique investment product that creates financial returns while nurturing the green economy.

“The Sovereign Fund of Egypt is a manifestation of Egypt’s 2030 Vision with the principles of sustainable development and impact investment instilled in its mandate, and this project is a cornerstone investment in our green sustainable portfolio build-up with many more to come,” says Soliman.

The parties will seek support from the Egyptian government for required regulatory approvals and sourcing of competitive renewable power from the grid, with the intention to build out new solar and wind capacity to power Egypt’s green hydrogen ambitions in the years to come.

The project will be realised in close cooperation with leading hydrogen technology providers and multilateral development institutions for financing.

Required engineering and development, including structuring of commercial agreements for the new facility, will start imminently with a target investment decision in 2022 and start-up of the hydrogen facility by 2024.

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