The agreement was signed during COP27 with the General Authority for Suez Canal Economic Zone (SCZONE), the Sovereign Fund of Egypt for Investment and Development (TSFE), the New and Renewable Energy Authority (NREA), and the Egyptian Electricity Transmission Company (EETC).
Over the next 12 years, the project will be developed in three phases, with 3.6GW of electrolysers powered by up to 9GW of solar PV and wind energy.
The first phase, involving a pilot project which will produce 100,000 tonnes a year of green ammonia from hydrogen, mainly targeting exports to Europe and Asia for use in fertilisers, is expected to start operations by 2026-27.
Other potential end-uses of green hydrogen, including green fuels, will be considered in the medium and longer term, once they become commercially feasible.
Egypt’s location, at the crossroads of Africa, Europe, and Asia and with about 13% of global trade flowing through the Suez Canal, puts the country in a strategic position to become a global green energy hub.
Globeleq has been investing in Egypt since 2003 – although the bulk of its listed portfolio covers South Africa, Kenya, Cameroon and Tanzania – and currently owns the ARC for Renewable Energy S.A.E solar PV plant located at the Benban Solar Park near Aswan (pictured).
The independent power producer aims to support the country’s ambitious strategy to tackle climate change by developing new solar PV, wind, battery energy storage, seawater desalination and green hydrogen projects in Egypt.
Mike Scholey, CEO of Globeleq, said: “Scaling up the green hydrogen sector is absolutely essential to decarbonise our world, but producing green hydrogen is both technologically and commercially challenging but through this project, Globeleq will show how hydrogen can be produced sustainably at a large scale through renewable energy.”
Waleid Gamal Eldien, Chairman of SCZONE, said the agreement is a continuation of its commitment to implement Egypt’s vision in the transformation towards a green economy.
He said, “The Government of Egypt has an ambitious energy transition plan, and active steps are being taken to make SCZONE a major hub for green hydrogen. This partnership reflects the interests of the private sector in investing in such projects as they choose SCZONE as a destination for investment in green hydrogen and green fuels, to serve both the African and global markets.”
Ayman Soliman, CEO of the Sovereign Fund of Egypt, said it marks a major milestone for Egypt’s green strategy and was only possible with the persistence of all government sponsors and the partners’ belief in the potential of Egypt as a green hydrogen hub.
He said Egypt has put a tremendous effort in the development of its Green Hydrogen Program and has made “incredible progress” reaching this stage in a matter of months.
“The signing of this binding agreement is a testament to TSFE’s ability to execute on its role in attracting private investment into strategic sectors. It comes in line with TSFE’s decarbonisation strategy using sustainable means that benefit the economy and position Egypt as a regional green energy hub.”