19-01-2022

Masdar and ENGIE to co-develop green hydrogen with Fertiglobe

Masdar, one of the world’s leading renewable energy companies, and ENGIE, a global player in low-carbon energy and services, have signed a collaboration agreement with Fertiglobe, the strategic partnership between OCI N.V. and the Abu Dhabi National Oil Company (ADNOC), and the world’s largest seaborne exporter of urea and merchant ammonia. Under the agreement, the companies will look to co-develop a globally cost-competitive green hydrogen facility in the UAE, with a capacity of as much as 200 megawatts (MW), to support the production of green ammonia. 

The collaboration agreement was signed by Frederic Claux, Managing Director, Thermal and Supply AMEA, ENGIE, Ahmed El-Hoshy, Chief Executive Officer of Fertiglobe, and Mohamed Jameel Al Ramahi, Chief Executive Officer of Masdar, at a ceremony yesterday evening on the sidelines of Abu Dhabi Sustainability Week (ADSW) 2022, taking place in the UAE capital. 

Frederic Claux, Managing Director, Thermal and Supply AMEA, ENGIE, said, “The production of green hydrogen in the UAE will be a significant milestone in its green transition, helping the country achieve its ambitious net-zero targets for 2050. Moreover, by supporting the development of green hydrogen projects across the value chain, together with Masdar and Fertiglobe, we will aid the creation of local jobs and give the UAE a competitive edge in the fast-growing hydrogen economy. This will enable some of the most intensive carbon producing industries — in particular, transportation and mobility, industry and agriculture — to go carbon neutral.” 

Ahmed El-Hoshy, Chief Executive Officer of Fertiglobe said, “This new partnership with Masdar and ENGIE represents a great opportunity for Fertiglobe and the UAE to play a crucial role in the global energy transition and fits well in the UAE’s vision of a diversified and sustainable future. Abu Dhabi is an ideal location to produce green hydrogen given the country’s commitment to a low carbon future, its unique renewables profile and its strategic geographic location. The project marks another milestone for Fertiglobe's green ammonia portfolio and follows the announcement last month of our new 100MW electrolyzer in Egypt. Ammonia is the dominant energy carrier for hydrogen. With green hydrogen seen as essential to support decarbonization of industry, food, transport and energy, there is a huge opportunity for green ammonia to deliver green hydrogen all over the world to fuel the clean economy and meet growing demand for renewable sources of clean energy.”

Mohamed Jameel Al Ramahi, Chief Executive Officer of Masdar, said, “This project will play a vital role in the development of the UAE’s green hydrogen economy, and represents the first concrete action taken by Masdar and ENGIE following the announcement last month of our strategic alliance. By working with innovative companies like Fertiglobe, we aim to support the UAE’s leadership in green hydrogen, and work toward achieving the nation’s net-zero emissions targets.” 

The three companies will study the development, design, financing, procurement, construction, operation, and maintenance of an industrial-scale and globally cost-competitive green hydrogen facility in Al Ruwais, Abu Dhabi, to be installed near Fertiglobe’s ammonia production plants, with a potential capacity up to 200 MW. The facility is targeted to be operational in 2025, with Fertiglobe the sole long term off-taker. 

Fertiglobe, the largest producers of nitrogen fertilizers and ammonia in the Middle East and North Africa, with a combined production capacity of 6.7 million tons of urea and merchant ammonia, will use the green hydrogen to produce green ammonia, supporting its ambitions to be a global leader in this sector. Fertiglobe is targeting a front-runner position in green ammonia production by 2025 in the UAE and is investing in a number of initiatives to produce low and zero-carbon ammonia. 

Green ammonia, produced from renewable energy such as solar and wind instead of natural gas, is a versatile product that is an ideal carrier to store and transport hydrogen, and can help decarbonize multiple sectors which together account for 90 percent of current global greenhouse gas (GHG) emissions. Green ammonia is also an important alternative fuel in its own right.

In December, Masdar and ENGIE announced the formation of a strategic alliance to explore the co-development of a UAE-based green hydrogen hub. The two companies are looking to develop projects with a capacity of at least 2 gigawatts (GW) by 2030, with a total investment in the region of US$5 billion. 

The strategic alliance aims to capture synergies and complementarities between the partners to establish an ‘early mover’ position in the UAE’s hydrogen market. By leveraging existing infrastructure, the companies will initially target local supply, with the aim of expanding capacity to create a giga-scale green hydrogen hub for the GCC, with the potential to export to other markets. The strategic alliance will also explore opportunities to develop projects in other geographies.