Egypt, Norway to establish major green hydrogen production plant in Ain Sokhna

Amr Kandil , Tuesday 8 Nov 2022

President Abdel-Fattah El-Sisi and Norwegian Prime Minister Jonas Gahr Støre launched on Tuesday the first phase of a project to establish a major green hydrogen plant with a capacity to produce 100 MW in Egypt's Ain Sokhna on the Red Sea.

President Abdel-Fattah El-Sisi and Norwegian Prime Minister Jonas Gahr St re
President Abdel-Fattah El-Sisi and Norwegian Prime Minister Jonas Gahr St re


The Egyptian president announced the launch of the Egyptian-Norwegian project during a roundtable that he co-chaired with German Chancellor Olaf Scholz titled "Investing in the Future of Energy: Green Hydrogen" as part of the 2022 UN Climate Change Conference (COP27) being held in Sharm El-Sheikh.

El-Sisi hailed the project, which will be implemented in cooperation with the Norwegian energy giant Scatec, saying it provides "a practical model of investment partnership that stimulates sustainable economic development with a focus on the role of the national and foreign private sector besides the government's role, working side by side in this fruitful sector."

Scatec has been a major developer at Egypt's massive Benban solar park in Upper Egypt's Aswan, one of the largest solar parks worldwide with a total capacity of 1.8 GW.

There will be an opportunity later Tuesday to get acquainted with all aspects of the project through the companies that are implementing the plant, El-Sisi noted.

Egyptian-Belgian hydrogen project

Also during the roundtable, El-Sisi unveiled a new Egyptian-Belgian green hydrogen initiative which he co-sponsored with Belgian Prime Minister Alexander De Croo. The initiative will establish a permanent platform for dialogue between hydrogen-producing and hydrogen-consuming countries as well as the private sector, organisations and financial institutions operating in this field.

El-Sisi said he would launch the initiative along with the Belgian premier Tuesday.

The initiative will seek to coordinate policies and measures and create trade and investment routes in green hydrogen in a way that helps expedite a just energy transition, according to El-Sisi.

“Green hydrogen has become one of the most important solutions on the way toward a green economy during the coming years," the Egyptian president said.

However, he stressed that developing countries cannot yet benefit from the opportunities provided by the transition toward green hydrogen due to their lack of technological capabilities in this new field, absence of required infrastructure and shortages in required investment.

He noted that even in the few cases in which developing countries, including Egypt, are capable of taking a step into the green hydrogen field, they still have to face challenges resulting from the tendency of some countries to back local green hydrogen producers in a way that decreases their production cost.

"This causes imbalance in the global hydrogen market and contributes to undermining the competitiveness of the green hydrogen produced in developing countries compared to the developed countries," the president added.

Speaking during the roundtable, Scholz said green hydrogen is the key to decarbonise the world’s economies, especially for hard-to-electrify sectors such as steel production, the chemical industry, heavy shipping and aviation.

"COP27 is a good opportunity to demonstrate development to date in both the renewable energy and green hydrogen ramp-ups and discuss ways forward," Scholz stated.

He added that the Middle East and North Africa have a great potential to become significant suppliers of green hydrogen because of their independent resources for renewable energy and their proximity to open markets.

Egypt's green hydrogen strategy

Egypt has announced that it will launch its national strategy for green hydrogen production during COP27 with a vision to produce green hydrogen at the cheapest price worldwide.

The strategy, implemented in cooperation with the European Bank for Reconstruction and Development (EBRD) and the Arab Union for Sustainable Development and Environment (AUSDE), seeks to help Egypt contribute to eight percent of the global hydrogen market, Egypt's cabinet said in a statement on Saturday.

Egypt has signed numerous memoranda of understanding (MoU) on hydrogen and green ammonia production with international partners over the past year as part of the country's efforts to attract foreign investments into green hydrogen production in order to become a transit route for clean energy to Europe.

In March, Egypt and Scatec signed in March an MoU to jointly develop a green hydrogen and ammonia plant with a 100 MW capacity in the Suez Canal Economic Zone (SCZone) at a cost of $5 billion.

The plant will have a production capacity of one million tons annually with the potential to expand it up to three million tons, the cabinet has said.

The project, which is expected to start production in 2025, will mainly export green ammonia to European and Asian markets, according to a statement by Scatec on 10 March.

The MoU was signed by the General Authority for Suez Canal Economic Zone (SCZONE), The Sovereign Fund of Egypt (TSFE), the Egyptian Electricity Transmission Company (EETC) and the New and Renewable Energy Authority (NREA) from the Egyptian side.

Egypt has been one of the first countries to early recognise the available opportunities in the green hydrogen field based on its massive potential in producing clean energy, El-Sisi said during the roundtable.

He noted that this potential will enable Egypt to turn into an international hub for producing green hydrogen on the medium and long terms.

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