On July 30, foreign media reported that Saudi International Power and Water Company (ACWA Power) announced plans to spend billions of dollars to build a second green hydrogen plant in Yanbu, Saudi Arabia.
It is reported that the plant will have 4G W electrolysis capacity, using wind and solar energy to decompose water molecules, and can produce 400000 tons of green hydrogen annually. This hydrogen will then be converted into green ammonia specifically for global export. Earlier
this month, Saudi International Power and Water signed a series of memorandums of understanding with Edison SpA of Italy, Total Renewable Energy of France, Zhero Europe BV of the Netherlands and EnBW of Germany to establish a green hydrogen supply chain from Saudi Arabia to Europe.
Madrid-based Tecnicas Reunidas previously said in a trading announcement that Saudi International Power and Water Company had selected the company to jointly undertake the front-end engineering design contract for the project with China's Sinopec Guangzhou Engineering Company. Tecnicas Reunidas said that they and Sinopec would complete the preliminary design work in the next 10 months, after which they would seek a contract for the construction of the plant. The project is expected to be put into commercial operation around 2030.
In addition to the core electrolyzer infrastructure, the Yanbu project also covers key supporting facilities. The facilities include an advanced desalination system to ensure a steady supply of pure water for electrolysis and a dedicated export terminal to facilitate the efficient transportation of green energy. Ammonia enters the international market. While the current design phase does not directly incorporate renewable energy generation assets, the plant's power is expected to come from large-scale solar and wind farms.
Saudi Arabia's efforts to promote green hydrogen are highly compatible with its broader economic diversification and energy transformation goals. Saudi Arabia has planned to invest up to $270 billion in the energy sector by 2030 and has set an ambitious goal of supplying 10% of the world's hydrogen exports . The Yanbu Green Hydrogen Center is expected to be the cornerstone of this goal, especially in providing green ammonia to help decarbonize global industries and power grids. The enthusiasm for hydrogen in the
Gulf region is evident, with massive investment and infrastructure construction taking place in the Middle East and North Africa. The United Arab Emirates has committed more than 10 billion euros to its hydrogen strategy, while Morocco is pushing ahead with a $32 billion plan to become a major hydrogen supplier to Europe.
In addition, Saudi International Power and Water Company is also one of the developers of the Green Hydrogen Project of New Future City (NEOM) in Saudi Arabia. The $8.5 billion project will produce about 219,000 tons of green hydrogen annually. The project is jointly invested and constructed by NEOM, Air Products of the United States and Saudi International Power and Water Company. It is planned to produce 600 tons of green hydrogen per day. It is planned to complete the commissioning of the electrolyzer in 2026 and enter the commercial delivery stage in 2027. The project utilizes renewable energy facilities with 4G W capacity to achieve zero carbon production through highly integrated solar and wind power generation systems.
However, although the project has been financed, the process of finding a stable buyer is difficult. At present, only one French company, Total Energy, has signed a purchase agreement with Air Products, accounting for about one third of the total output. Faced with the shortage of international buyers, the project side is forced to seek a breakthrough in the local market and consider reducing the scale of development or investing in stages. People familiar with the situation said that as some key facilities have been completed, adjusting the progress of the project is facing considerable challenges.
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