Egypt Signs Hydrogen Framework Agreement Saudi Eyes High

Egypt Signs Hydrogen Frame Agreement Saudi Eyes High
Egypt Signs Hydrogen Frame Agreement Saudi Eyes High

Having signed eight framework agreements Tuesday to advance green hydrogen and ammonia projects, Egypt announced its goal of becoming a hub for hydrogen production and capturing 2040% of the global market by 5.

Hydrogen, called green or clean hydrogen, is produced using renewable energy-powered electrolyzers to separate water from oxygen. Although used mainly in research projects to date, it is believed to be a potential power source that could reduce emissions in the future.

Business sources, professionals and academics argue that there are many obstacles to its development, including high costs and energy inputs, safety concerns, and the need to invest heavily in infrastructure to transport and store fuel.

Most of the hydrogen currently used in fertilizers and refineries is derived from natural gas, and many of these processes result in large emissions of carbon dioxide.

The Suez Canal Economic Zone and the Red Sea port of Ain Sokhna were the focus of agreements reached at the COP27 climate conference on Tuesday, which included companies such as AMEA Power, Alfanar, TotalEnergies, Globeleq, EDF, Fortescue Future Industries (FFI), ReNew and Scatec.

Egypt unveiled its low-carbon hydrogen strategy financed by the Egyptian Sovereign Fund and the European Bank for Reconstruction and Development (EBRD) at the Sharm el-Sheikh talks.

According to Egyptian Electricity Minister Mohamed Shaker, the aim of the plan is for Egypt to lead the world in the low-carbon hydrogen economy by utilizing its significant natural gas reserves, advantageous position and renewable energy sources.

The draft strategy identified fertilizer products, ammonia, and methanol, jet fuel, and road or rail transport for use as marine fuel or energy exports as the main sources of Egypt's future hydrogen demand.

The lack of fresh water, the distance between the best sites to produce green hydrogen, and the need to ship hydrogen overseas have been cited as obstacles to the development of the hydrogen economy.

The framework agreements are extensions of previous memoranda of understanding that Egypt recently signed, including an $8 billion green hydrogen plant in the Suez Canal Economic Zone and a $3,5 billion project by Saudi Arabia's Alfanar to produce green ammonia.

At a separate event at the COP27 conference, Noam Boussidan, an energy conversion expert at the World Economic Forum, stated that the price of hydrogen should come down and it should be used in the right industries.

“The kind of thinking that hydrogen will save us all, hydrogen will save the world,” he described a typical fallacy.

Saudi Arabia aims high

According to Zeid al-Ghareeb, Hydrogen Director of the Ministry of Energy, who made a statement at the UN Climate Change Conference held in Egypt, Saudi Arabia aims to become a global supplier of renewable and low-carbon hydrogen to meet market demands in both Europe and the Asia-Pacific region.
Al-Ghareeb predicted that hydrogen will be a large part of the world's energy mix in the future. Saudi Arabia aims to produce 2030 million mt/year of "clean" hydrogen by 4.

He warned that this amount could be exceeded as demand increases.
The country chose to focus on carbon intensity rather than distinguishing between "green" and "blue" hydrogen (which produces both).

Greenhouse Gas Production Reduction Studies

Al-Ghareeb replied that we should not focus on the energy source. We must have an open mind.

Instead, he suggested focusing on emissions in line with net zero targets to reduce greenhouse gas production.

According to Serhan, work has already begun on Saudi Arabia's Neom project, which will start producing 2026 mt/day of renewable hydrogen in 650.

4 GW of wind and solar energy will be used to power the Neom facility.

The company is also developing a “world-class” hydrogen plant in Jubail that will reform natural gas using carbon capture technology to produce 420 mt/day of hydrogen.

Regulation was needed to adopt clean hydrogen. Aramco aims to export 2030 million metric tons (mt) of low-carbon hydrogen per year by 11. According to him, the first use cases will be the already existing fertilizer production and refining markets.

Consumer demands in these markets will determine Saudi Arabia's production standards and carbon intensity.

In the medium term, centering demand centers around clusters will be vital, as ammonia provides a ready end market and means of transport for hydrogen.

Saudi Arabia has been testing hydrogen buses in Mecca to welcome the 2 to 3 million pilgrims who visit Mecca each year as part of its experimental mobility efforts.

Pipes will be the cheapest supply option in the medium term if there are demand clusters to sustain the infrastructure investment.

Source: energynews – Arnes Biogradlija

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