Air Products and Acwa Power to Develop $5bn Green Hydrogen Plant in Saudi Arabia

In a groundbreaking collaboration, US-based Air Products and local powerhouse Acwa Power have formalized their commitment to develop a colossal $5bn hydrogen-based ammonia plant in Saudi Arabia. The memorandum of understanding (MoU) signed between the two entities marks a significant step toward the realization of this ambitious project, set to be situated within the $500bn Neom development on the Red Sea Coast—a key megaproject under the Kingdom’s Public Investment Fund (PIF), aimed at steering the economy away from oil dependency.

Visionary Project Overview

The planned $5bn hydrogen-based plant is poised to be a beacon of sustainable innovation, powered by a staggering 4GW of renewable energy. Located strategically at the Neom development, this initiative is set to produce an impressive 1.2 million tonnes per year of ammonia. Moreover, the facility boasts the remarkable capacity to generate 650 tonnes of hydrogen daily, signaling a major leap forward in green hydrogen production.

Driving Economic Diversification

The Neom development, a central component of the Kingdom’s economic diversification strategy, aligns with the broader vision to reduce dependence on traditional oil revenue. The $500bn investment in Neom aims to transform the region into a global hub for innovation, technology, and sustainable practices.

Strategic Partnership History

This collaboration is not the first for Air Products and Acwa Power. Their successful joint ventures include a 2018 agreement with Saudi Aramco to form a more than $8bn joint venture. The venture operated a $4bn gasification plant and a 4GW power plant, emphasizing the strength and synergy inherent in their partnership.

Green Hydrogen Production Timeline

With Air Products committed to becoming the offtaker for the produced green ammonia, an additional investment of $2bn in distribution underscores their dedication to the project’s success. The production from this state-of-the-art facility is set to commence in 2025, marking a pivotal milestone in the Kingdom’s journey towards sustainable and environmentally friendly energy solutions.

As the world witnesses the emergence of transformative green projects, the $5bn hydrogen-based ammonia plant in Saudi Arabia stands out as a testament to the collaborative efforts driving innovation, economic diversification, and a sustainable energy future.

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