New agreement for green hydrogen production plant in NEOM

New agreement for green hydrogen production plant in NEOM
Visitors watch a 3D presentation during an exhibition on NEOM in Riyadh. (Reuters)
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Updated 07 July 2020

New agreement for green hydrogen production plant in NEOM

New agreement for green hydrogen production plant in NEOM
  • The joint venture project is the first partnership for NEOM with international and national partners in the renewable energy field

JEDDAH: A $5 billion production facility powered by renewable energy to supply 650 tons of carbon-free hydrogen daily for export to global markets is to be built at the main Neom site under a new agreement.

Air Products, a world-leading industrial gases company, and ACWA Power, a developer and operator of power generation and desalinated water production plants, signed the agreement with Neom to build the hydrogen-based ammonia production facility, which will be equally owned by the three partners. It aims to produce green ammonia for export to global markets by 2025.

The joint venture project is the first partnership for Neom, a new model for sustainable living located in the north west corner of the Saudi Arabia, with international and national partners in the renewable energy field. It will include the innovative integration of more than four gigawatts of renewable power from solar and wind power and storage using various methods of production.

“This partnership reflects our deep commitment to developing a carbon-positive society that will be a beacon for sustainable living and a solution to many of the environmental challenges facing the world,” said Nadhmi Al Nasr, Neom CEO.

“Neom’s Board of Directors, headed by Crown Prince Mohammed bin Salman, and the company’s executive team are delighted to announce this significant milestone, the world’s largest renewable hydrogen project, for Neom to make it a global leader in green hydrogen production and green fuels. We are also excited that two world-class organizations, Air Products and ACWA Power, have joined us in developing this major project, the first of many developments at this scale that will put Neom at the heart of a new future society.”

“We are honored and proud to partner with ACWA Power and Neom and use proven technologies to make the world’s dream of 100 percent green energy a reality,” said Seifi Ghasemi, Chairman, President and Chief Executive Officer for Air Products.

Ghasemi went on to say that harnessing the unique profile of Neom’s sun and wind to convert water to hydrogen will yield a clean source of energy on a massive scale and will rid the world of over 3 million tons of CO2 emissions annually and eliminate smog-forming emissions and other pollutants from the equivalent of over 700,000 cars.

Air Products will be the exclusive off-taker of the green ammonia and intends to transport it around the world to be turned into green hydrogen for the transportation market.

ACWA Power chairman Mohammed A. Abunayyan said that “based in Neom’s Industrial Cluster and enabled by its unique mandate, this investment will integrate and localize cutting-edge technologies that will harness solar and wind power to produce sustainable and globally accessible green energy.”

 “ACWA Power has a proven track record of leveraging pioneering renewable technologies to deliver carbon-free power at the lowest cost. With our global experience, we are confident that our collaboration with an industry-leading company like Air Products will create significant opportunities in the production of green hydrogen, and further us in our goal to help countries meet their clean energy targets and unlock significant socio-economic benefits.”

Speaking to Arab News, Peter Terium, head of the energy, water and food at NEOM, said that the agreement would allow the giga project to play a key role in resolving the growing issue of carbon emissions.
“NEOM’s unique position will allow it to produce green hydrogen for the global market at competitive prices,” he said.
He said the plant aims to mostly export its product to Europe, Japan, and the US to provide these markets with an alternative to the current carbon-intensive fuels and gases. However, the plant will also serve the local market, as it plans to serve the local market with a maximum of 5 percent of its output.
The hydrogen plant will be built in one go, he added. “There won’t be a pilot phase or first phase with an extension. We’re using proven technology so we can build the full-scale 2,000-megawatt in one go.”