Masdar signs breakthrough deal to develop green hydrogen in Egypt

Masdar signs breakthrough deal to develop green hydrogen in Egypt

/ Renewables / Tuesday, 26 April 2022 06:29

Masdar, one of the world’s leading renewable energy companies, and Hassan Allam Utilities, the investment and development arm of Hassan Allam Holding Group, signed two Memorandums of Understanding (MoU) with leading Egyptian state-backed organizations to cooperate on the development of green hydrogen production plants in the Suez Canal Economic Zone and on the Mediterranean coast.

The MoU were signed in the presence of Mostafa Kamal Madbouly, prime minister of the Arab Republic of Egypt, Dr Sultan bin Ahmed Al Jaber, UAE minister of industry and advanced technology, special envoy for climate change and chairman of Masdar, Dr Mohamed Shaker El-Markabi, minister of electricity and renewable energy for Egypt, and Dr Hala El Said, minister of planning and economic development and chairperson of the sovereign fund of Egypt.

Amr Allam and Hassan Allam, co- chief executive officers of Hassan Allam Holding, were also in attendance, along with Mohamed Jameel Al Ramahi, chief executive officer of Masdar. The Egyptian organizations concerned include the New and Renewable Energy Authority, the Egyptian Electricity Transmission Company, The Sovereign Fund of Egypt, and The General Authority for Suez Canal Economic Zone.

Mostafa Kamal Madbouly expressed his happiness at this signing with Egypt’s brothers in the UAE, highlighting the directives of President Abdel Fattah El-Sisi, to strengthen and consolidate relations with the UAE in various sectors, so as to contribute to achieving the interests of the two nations. He stressed that the state is working to encourage investment in green energy projects, due to Egypt's potential to become an important pivotal and regional hub in this vital sector, which is expected to transform the global energy system during the upcoming period. These projects will also accelerate energy transition process in the region.

Dr Sultan bin Ahmed Al Jaber, said, "Today’s partnership agreements to explore the development of green hydrogen production demonstrates the strength of the close relationship between The United Arab Emirates and the Arab Republic of Egypt. These projects will build on the UAE’s and Masdar’s position as an early mover in the global hydrogen market and expand our capacity to deliver zero carbon energy solutions. As our two countries prepare to host the next two COPs, we look forward to working with our partners in Egypt to make practical advances in the energy transition that will provide significant benefits for the economy and the climate."

Mohamed Jameel Al Ramahi, chief executive officer of Masdar, said, "These agreements represent a vital step forward in the development of the green hydrogen economy for both the UAE and Egypt, and will play a significant role in our two nations’ decarbonization efforts. By working with partners such as Hassan Allam Utilities, we can help the green hydrogen market achieve its full potential over the coming years and play its part in supporting the global energy transition."

In the first phase of the project, Hassan Allam Utilities and Masdar aim to establish a green hydrogen manufacturing facility, which would be operational by 2026, producing 100,000 tonnes of e-methanol annually for bunkering in the Suez Canal. The electrolyser facilities in the Suez Canal Economic Zone and on the Mediterranean could be extended to up to 4 GW by 2030 to produce 2.3 million tonnes of green ammonia for export as well as supply green hydrogen for local industries.

Masdar and Hassan Allam Utilities see Egypt as a hub for green hydrogen production, targeting the bunkering market, export to Europe, and boosting local industry. Egypt enjoys abundant solar and wind resources that allow generation of renewable power at a highly competitive cost –a key enabler for green hydrogen production.

Egypt is also located within close proximity to markets where demand for green hydrogen is expected to grow the most, providing robust opportunity for export. Driven by green hydrogen’s export potential, its ability to attract large-scale foreign direct investment and opportunities to contribute to the Government’s efforts to optimize generation costs and increase the share of renewables in the country’s energy mix to 42% by 2030, the ministry of electricity is currently revising its 2030 renewable energy strategy to include green hydrogen, and is developing a green hydrogen strategy, which is expected to be issued by October 2022.

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