Egypt leads MENA in green hydrogen production,
Egypt is leading MENA in terms of value of green hydrogen projects in the pipeline, with some USD 63.8 bn (or a hair over 35%) of the USD 180 bn worth of projects that have so far been announced, according to data from Middle East Business Intelligence (MEED) picked up by Kuwait’s Al Anba on Friday. Egypt was followed by Oman (USD 48.9 bn) and Morocco (USD 16.85 bn). Saudi Arabia came in fourth with USD 10.5 bn, while the UAE ranked fifth across the region with USD 10.3 bn. Qatar and Kuwait both ranked last with USD 15 mn each.
It’s not a surprise that Egypt is in the lead: This summer alone, Egypt signed USD 32 bn worth of preliminary agreements for green ammonia and hydrogen projects with seven international companies set to generate a combined annual capacity of around 5.5 mn tons of green fuel in the Ain Sokhna industrial zone.
But MENA’s green hydrogen projects need some foundational work. These include the development of clear regulations, agreements on certifications and streamlining electrolyzer production to make investments more profitable, Al Anba writes, referring to discussions held among industry professionals at the Wetex and Dubai Solar Show.
The bigger question: How many of these MENA plants will get built in the wake of the US Inflation Reduction Act, which includes a 10-year production tax credit of as much as USD 3 / kg of H2 produced with no emissions.
Maersk could break ground on its green hydrogen project in Egypt as early as December, Al Mal reported yesterday, citing what it said are “sources close to the matter.” The initial phase of the project is expected to be finalized within a year after land for the project gets allocated, the sources said, with hydrogen shipments expected to be exported the following year. Al Mal’s sources say the output could go for as much as USD 2.5 / kg, but says nothing about who the offtaker would be.
No comment so far from the principals: We reached out to Maersk and the Suez Canal Economic Zone (SCZone), who have yet to comment on the matter as of dispatch.
Background: The plant comes as part of a USD 15 bn project to produce clean fuel for shipping in the SCZone, which Maersk said last month it could sign up for.