The fuel of the future: Hydrogen and the Middle East advantage


The fuel of the future: Hydrogen and the Middle East advantage

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The Gulf countries have, with a lot of clarity, chalked out a clear pathway to deliver a promise to their future generations; a promise of prosperity while keeping the decarbonisation goal in clear vision. From being one of the largest hydrocarbon producers, the region has a clear desire to shift towards becoming the most significant provider of clean energy. All the required pre requisites are already there: the sun, the land, the water, proximity to large demand centres in addition to demand within.  

More than 680 large scale hydrogen projects have been announced globally. Almost half these projects are in Europe. China has a larger chunk of projects in Asia, and the Middle East and North African region has significant plans too.  

The region is ideally placed to be a key player in energy transition discussions, and the Middle East certainly is gearing up to be a large decarbonisation cluster. From North Africa all the way to the gulf, all major players have their own commitments, clean energy pathways and a distinct hydrogen advantage. In particular, Saudi Arabia, Oman, and the UAE have the capability to rule the hydrogen market with their abundant and low cost renewable resources. 

Saudi Arabia now has major hydrogen plans under the larger umbrella of Vision 2030. In 2020, Aramco became the first provider to dispatch 40 tons of blue ammonia to Japan. NEOM’s Green Hydrogen Project, powered by Acwa power and Air products, will be the world’s largest utility scale commercial hydrogen facility to produce green ammonia powered entirely by 4 gigawatts of renewable energy. There are several other large-scale projects in the pipeline. 

The ambition not only stays within Saudi Arabia’s own borders, but the aim is to work in collaboration with other countries. A live example is Acwa power singing up for a green hydrogen facility in Uzbekistan to generate 3,000 tonnes p.a of green hydrogen. The facility will be connected to an existing ammonia plant in Chirchiq, located 45 kilometres from Tashkent, the country’s capital. From supply agreements with Korea Electric Power Corporation, to building green hydrogen facility in Sokhna, Egypt, the desire is to lead the hydrogen ambition. 

All the required pre-requisites are already there: the sun, the land, the water, proximity to large demand centres in addition to demand within.  

Ayla Majid

The UAE is not lagging behind in the hydrogen leadership. UAE’s Nationally Determined Contributions recognise hydrogen as the “fuel of the future.” The country aims to be a significant contributor to the global hydrogen market and is home to Middle East's first green hydrogen plant - Siemens Energy built facility at DEWA. Operational since 2021, the facility is linked to the Al Maktoum Solar Park. Abu Dhabi’s Energy Company TAQA and Emirates Steel have joined hands to leverage on their advantage to produce green steel by developing an industrial-scale green ammonia plant. In addition to that, the UAE has also signed an agreement with Japan, to develop a supply chain of hydrogen and collaborate in areas of technology development and feasibility studies to produce hydrogen in the UAE for transportation and consumption in Japan. TAQA, Mubadala and ADNOC completed their landmark transaction to come together to produce 1 million tons of hydrogen by 2030 through Masdar clean energy. 

Qatar, relying on its global LNG leadership and leverage, will use its resources to produce blue ammonia for export. A project planned to build a USD 1 billion blue ammonia plant has been announced.  

Oman too has set its foot on the journey of the global hydrogen market with the aim to produce one million tons of hydrogen annually by 2030. The Omani government has established the Hy-Fly alliance, a collaboration of academia, research, government entities, and hydrocarbon players to collectively work on the hydrogen agenda. Omani oil investment company OQ has collaborated with InterContinental Energy, and EnerTech Holding, a subsidiary of the Kuwaiti SWF for the construction of a wind-and-solar power plant with a capacity of 25 GW scheduled for 2028. The plant is expected to supply Europe and Asia via the port of Duqm. Furthermore, Oman has also signed an Mou with ACWA Power and Air Products to start a multibillion green hydrogen project in Oman.  

During COP 27, Egypt alone signed eight framework agreements for hydrogen production, projects mainly concentrated around the Red Sea port of Ain Sokhna and the Suez Canal Economic Zone. One significant agreement was with Fortescue Future Industries to build 7.6GW of large-scale renewable energy (wind and solar) to produce green hydrogen in Egypt, land rights for which are already secured.  

The plans have been laid out and now the real work begins. Ambitions do not often come without challenges and there are certainly several in the MENA hydrogen journey as well. The challenges can be overcome by establishing collaborations, to address key gaps such as mapping the demand and supply, bringing technology providers closer to project development, developing effective transportation methodologies and safety standards. Global green finance must also follow this development to help achieve the net zero and 1.5% targets. A voice of collaboration working hard to abate industry stakeholders is a must. Many such continuous deliberations will be required leading up to COP 28.

- Founder & CEO of Planetive, with financial advisory and governance experience across energy and infrastructure sectors. Sits on many local and global boards. Sustainability advocate. Serving on the Global Future Council on Energy Transition of the World Economic Forum. Young Global Leader - WEF. Eisenhower Fellow.

Disclaimer: Views expressed by writers in this section are their own and do not necessarily reflect Arab News' point-of-view