Egypt has racked up at least $20 billion worth of plans for investment in green hydrogen and ammonia projects to be operational by 2035, according to Rystad Energy.
The northern African nation ranks second behind Australia for green hydrogen project pipelines globally, according to the report.
The plans come as Egypt is set to host world leaders at the COP27 conference to address climate change next year. Egypt is additionally set to release a $40 billion national hydrogen plan covering production storage and import/export of green hydrogen and ammonia, allowing for state support and tax incentives, according to Rystad.
Most hydrogen produced currently involves natural gas, which does leave an emissions footprint. Green hydrogen uses renewable energy, currently cheaper in many places than natural gas, and electrolysis to create fuel or ingredients for fertilizer.
“Egypt has all the prerequisites to become a green hydrogen giant – fantastic renewable potential, space for mega projects and construction expertise,” according to Dr Minh Khoi Le, Head of Hydrogen at Rystad Energy. “Sitting between three continents and with the Suez Canal carrying approximately 12% of all the seaborne freight in the world, Egypt can supply renewable energy near and far. The domestic market will benefit too as the Egyptian agriculture sector can look forward to being one of the greenest when it comes to fertilizer use.”
The Suez Canal Economic Zone (SCZONE) is the centerpiece of development plans, playing host to about 80% of the slated projects.
Total plans have reached 11.62 gigawatts (GW), equivalent to over 1.57 million tonnes of green hydrogen, according to Rystad research. The main draws are the country’s location, natural gas infrastructure, liquefaction facilities, bunkering market and marine ports, as well as its high solar and wind potential.
The country has simplified the process for establishing, operating, and managing hydrogen projects by requiring a single permit, which means less red tape. Additional incentives could include special custom points for export/import, utilities connection costs being passed on to the state, the reimbursement of 50% of land allocation costs (under the condition that the project commences production within two years) and other non-fiscal incentives.
Major energy initiatives in the region include French utility EDF and ZeroWaste, a UAE-based project developer, which signed an MoU with Egypt’s Suez Canal Economic Zone (SCZONE) to produce 350,000 tonnes of green fuel annually in the Ain Sokhna region for ships, vessels, and tankers crossing the Suez Canal. The project’s first phase will produce 140,000 tonnes of green ammonia using close to 25,000 tonnes of green hydrogen from desalinated seawater and renewable energy as feedstock. Commissioning is scheduled for 1Q 2026. Capacity will then gradually increase to 350,000 tonnes of green ammonia production per year. The project will involve a total investment of $3 billion.
AMEA Power, a subsidiary of Al Nowais Group, also inked an MoU with SCZONE to produce 390,000 tonnes of green ammonia per year in Ain Sokhna for export purposes.
In addition, Norway’s Scatec announced plans to develop a $5 billion green hydrogen and ammonia facility, that will also be located in the SCZONE. Scatec inked an MoU with the General Authority for SCZONE for the project, which will be capable of producing 1 million tonne of green ammonia annually, and could potential expand to 3 million tonnes green ammonia. The green ammonia will mainly be exported to European and Asian markets, where demand for clean ammonia is increasing rapidly.
Other projects in the country come from Danish shipping company Maersk. British oilfield services provider Petrofac and New-York based hydrogen production and energy storage company H2-Industries aim to produce green fuels, green ammonia as well as liquid organic hydrogen carriers (LOHC).
The hub’s Air Sokhna region enjoys proximity to a seawater desalination plant (150,000 m3/day), sewage treatment plant (35,000 m3/day), and bunkering facilities like ammonia (80,000 tonnes), which make it very suitable for the trade of hydrogen and its derivatives. The seven projects announced for the region in the last three months have a combined capacity of 10.76 GW, meaning an output of over 1.5 million tonnes of green hydrogen.