Flurry of green hydrogen and ammonia deals underpins EU-Egypt partnership

The Egyptian government and the European Union (EU) are advancing green hydrogen and green ammonia incentives through their strategic and comprehensive partnership and new private investment agreements signed by European and Egyptian companies.

Courtesy of Masdar

The agreements, worth €40 billion and covering renewable energy and hydrogen among others, were concluded during the EU-Egypt Investment Conference, co-organized by the EU and the Government of Egypt on June 29-30, as part of the Strategic and Comprehensive Partnership signed by the EU and Egypt in March 2024.

The Investment Conference was held to discuss economic reforms pursued by Egypt to improve the business environment and to attract further EU investment in key sectors. These reforms and investments are expected to drive forward the energy transition, in areas including the production of renewable hydrogen, to promote the circular economy, and to boost the pharmaceutical, medical, and automotive sectors.

The EU and Egypt also signed a memorandum of understanding (MoU) for the disbursement of up to €1 billion in macro-financial assistance (MFA) to Egypt. The MFA is expected to promote macroeconomic stability, improve the business environment and enhance Egypt’s competitiveness, and support Egypt’s green transition. 

Opening the Investment Conference, EC President Ursula von der Leyen said: “One hundred days ago we opened a new era in the relations between Egypt and the European Union, with our strategic and comprehensive partnership. Today, we deliver.

We deliver for Egyptian businesses and entrepreneurs with €1 billion in macro-financial assistance, which will incentivise the reforms that businesses and entrepreneurs in the private sector need. We deliver strategic investments that will help make Egypt a clean energy hub at the centre of the Mediterranean, crossroads. And we deliver for Egypt’s youth, with a new skills programme so they succeed in the economy of the future. And this is just the beginning.”

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At the conference, UK-based energy major BP entered into a joint development agreement (JDA) to join the existing consortium comprising Masdar, Hassan Allam Utilities, and Infinity Power to explore the potential development of a multi-phase green hydrogen project in Egypt, with a focus on exports.

Under the JDA, BP will act as the lead developer and operator of the project on behalf of the consortium which has signed a framework agreement (FWA) with the Egyptian government to start carrying out a set of studies and activities to evaluate the technical and commercial feasibility of the project.

Next, renewable energy player Voltalia and its partner TAQA Arabia signed a framework agreement to develop a cluster combining green hydrogen production with renewable power generation. The project will be implemented in two identical phases, each comprising a 500 MW electrolyzer powered by more than 1.3 GW of solar and wind energy. The facility will have an annual production capacity exceeding 350,000 tons of hydrogen for each phase. It will be located at a greenfield site near Ain Sokhna port in the Suez Canal Economic Zone.

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Norwegian renewable energy solutions provider Scatec and its partners the Egyptian Petrochemicals Holding Company (ECHEM) and Misr Fertilizers Production Company (MOPCO) have agreed on heads of terms for renewable ammonia offtake from Egypt with Yara Clean Ammonia.

The partner will develop and build up to 480 MW of renewable energy and an up to 240 MW electrolyzer facility for the production of renewable hydrogen, which will be used as feedstock for the production of renewable ammonia at MOPCO’s existing ammonia production facility at Damietta in Egypt. The targeted production capacity is up to 150,000 tonnes of renewable ammonia per annum.

Scatec also signed a letter of intent with the European Investment Bank (EIB) for long-term financing for the project, showcasing EIB’s commitment to supporting renewable hydrogen and renewable ammonia projects in Egypt.

Egyptian government inked an agreement with a consortium of EDF Renewables and Zero Waste to develop a project to produce green hydrogen and its derivatives and green ammonia Ras Shukair on the Read Sea coast. The partners plan to invest a total of €7 billion in the three-phase project. The first phase targets to produce 1 million tons of green ammonia annually.