Scatec’s Egypt Green Hydrogen Project signed 20-year offtake
agreement with Fertiglobe, based on H2Global award
Oslo, 11 July 2024: Scatec ASA’s Egypt Green
Hydrogen project, in partnership with Fertiglobe, Orascom
Construction, The Sovereign Fund of Egypt and the Egyptian
Electricity Transmission Company, reaches a key milestone, after
Fertiglobe secured a green ammonia offtake agreement with Hintco in
Germany, through the first ever H2Global auction.
Based on the award, Fertiglobe and Egypt Green
Hydrogen have entered into a 20-year ammonia offtake agreement. The
agreement was signed at the Egypt-EU Investment Conference in Egypt
on 29 June 2024.
“The H2Global award represents a key milestone
for the Egypt Green Hydrogen project in Ain Sokhna, Egypt. This
demonstrates the competitiveness of green hydrogen and ammonia
production in Egypt, driven by its abundant renewable energy
resources and strategic geographical location. We are grateful for
the Egyptian government´s leading role in supporting this
pioneering project and we look forward to continuing to work with
the relevant stakeholders to establish Egypt as a regional green
hydrogen hub. With Fertiglobe securing an offtake agreement for the
ammonia, Egypt Green Hydrogen will accelerate the project’s
development and advance it towards financial close,” says
Scatec CEO Terje Pilskog.
In 2021, Scatec and partners agreed to develop,
build, own and operate a 100 MW electrolyser facility to produce
renewable hydrogen to be used as feedstock for the production of
renewable ammonia at Fertiglobe’s existing ammonia plant in Ain
Sokhna, Egypt. The project will be powered by about 270 MW of solar
and wind power capacity and deliver approximately 13,000 tonnes of
renewable hydrogen and up to 74,000 tonnes of renewable ammonia
annually.
Scatec is the lead developer and majority
sponsor of Egypt Green Hydrogen with an ownership share of 52% and
will provide EPC services in collaboration with Orascom
Construction. Scatec will further provide O&M and Asset
Management services for the project alongside key technology
providers and project partners.
Next important milestones for the project are to
select the electrolyser supplier and complete the project financing
process with the European Bank for Reconstruction and Development
(EBRD), European Investment Bank (EIB), Germany’s development
finance institution and KfW subsidiary DEG, British International
Investment (BII), and US International Development Finance
Corporation (DFC), that are providing competitive financing to
support the first green hydrogen and ammonia project in Egypt. The
partners expect to reach financial close in the first half of
2025.
Ahmed El-Hoshy, Chief Executive Officer
of Fertiglobe, said: “This award marks a significant
milestone for Fertiglobe in advancing sustainable ammonia
production and a further critical step towards FID of Egypt Green
Hydrogen, expected in H1 2025. Our selection as the winning bidder
in H2Global’s pilot auction underscores our leadership in supplying
low-carbon products and our commitment to shaping a more
sustainable future, and I appreciate the work of our incredible
team to make this award possible. We are leveraging this vital
program which makes our investment in sustainable ammonia
economically viable, supporting critical decarbonization
technology, while maintaining our disciplined growth strategy.”
Gelsomina Vigliotti, Vice President of
the European Investment Bank, said: "Green hydrogen has a
key role to play in the energy transition and in providing
carbon-neutral solutions for industry. The first offtake agreement
for hydrogen produced in Egypt, agreed at the Egypt-EU Investment
Conference, represents a key step for future large-scale investment
in the sector. The European Investment Bank looks forward to
strengthening our cooperation with Scatec, Egyptian and
international partners to mobilise investment for large-scale
renewable hydrogen production in Egypt.”
Nandita Parshad, Managing Director of
the EBRD’s Sustainable Infrastructure Group, said: “The
signing of the offtake agreement is a key milestone for the Egypt
Green Hydrogen project with our long standing clients Scatec and
Orascom Construction, as well as the Sovereign Fund of Egypt and
Fertiglobe. The EBRD is proud to support this pioneering project
which will produce 13,000 tons of renewable hydrogen annually and
demonstrate the commercial viability of renewable Hydrogen in
Egypt.”
Monika Beck, Managing Director at
DEG, commented: “It is part of DEG’s mission as an impact
and climate financier to promote green hydrogen as a driver of
green transformation. We are delighted to contribute to mobilizing
investment in this milestone project in Egypt together with our
esteemed client Scatec and our development finance partner
institutions. We are convinced that it is essential to join forces
to drive forward the green transformation, and the private sector
plays a key role in this.”
Iain Macaulay, Director and Head of
Project Finance in Africa at BII, said: “Egypt has the
potential to be a global leader in renewable energy generation and
green hydrogen production. I am delighted that BII has been able to
provide project finance to back this landmark project, that will
support a green and sustainable future for the country and showcase
the importance of new technologies in supporting a just transition
for the whole African continent.”
The project is located in Egypt’s Suez Canal
Economic Zone (SCZONE), which seeks to become a major hub for green
hydrogen industries. Waleid Gamal Eldien, Chairman of
SCZONE, said: “The Egypt-EU
Investment Conference 2024, marked a vital milestone on Egypt’s
pathway to become a global green ammonia hub, as we celebrated the
signing of a flagship offtake agreement between Fertiglobe and
Egypt Green Hydrogen, the first green hydrogen plant in Africa,
located at the SCZONE. As first agreement under H2Global auction,
the offtake not only demonstrates the EU support to the emerging
green hydrogen industry and the realization of Egypt’s potential,
but additionally emphasizes Egypt's determination to reach its
vision, and showcase its comparative advantage stemming from its
abundant renewables resources, industrial land, and its unique
geographic location with ease of access to the world. The agreement
is a testimony of Egypt’s leadership and support in mobilizing its
resources to attract foreign direct investments in green projects
through the facilitation provided by its stakeholders.”
The H2Global Foundation was established in 2021
to accelerate the emergence of markets for clean hydrogen and other
zero-and low-emission technologies worldwide. It does so through
market-based instruments, such as the H2Global mechanism,
implemented by its subsidiary Hintco. The German Federal Government
has committed EUR 4.43 billion into this initiative.
Please find the announcements by
H2Global & Fertiglobe here:
H2Global: News (h2-global.org)
Fertiglobe: Newsroom - Fertiglobe
For further information, please contact:
For analysts and investors: Andreas Austrell, VP IR, phone: +47 974
38 686, andreas.austrell@scatec.com
For media: Meera Bhatia, SVP External Affairs & Communications,
phone: +47 468 44 959, meera.bhatia@scatec.com
About Scatec
Scatec is a leading renewable energy solutions provider,
accelerating access to reliable and affordable clean energy
emerging markets. As a long-term player, we develop, build, own,
and operate renewable energy plants, with 4.6 GW in operation and
under construction across four continents today. We are committed
to grow our renewable energy capacity, delivered by our passionate
employees and partners who are driven by a common vision of
‘Improving our Future’. Scatec is headquartered in Oslo, Norway and
listed on the Oslo Stock Exchange under the ticker symbol
‘SCATC’. To learn more, visit www.scatec.com or
connect with us on LinkedIn.
This information is subject to the disclosure requirements
pursuant to Section 5-12 the Norwegian Securities Trading Act
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