Egypt inks $33bn worth of green ammonia deals with energy majors
Egypt has signed deals worth $33 billion with companies including BP, Masdar, and Germany’s DAI for green ammonia projects, The National reported, citing a statement by the Egyptian government.
One of the projects, worth $11 billion, would see Egypt’s sovereign wealth fund partnering with German FAI Infastruktur for the construction of a green ammonia plant in East Port Said.
The other, with a piece tag of $14 billion, would see the country partner with BP, Masdar, and a subsidiary of the Emirati company, Infinity Power, to build another green ammonia plant in Ain Sukhna Port on the Gulf of Suez.
Green ammonia, like green hydrogen, is seen as an indispensable part of the energy transition because of its theoretical ability to help decarbonize hard-to-decarbonize sectors such as, in the case of ammonia, fertilizer production.
The problem with the green versions of both hydrogen and its product ammonia is that the process of making them is quite costly. The reason they are called green is because they are produced through hydrolysis, powered by wind or solar power.
Yet the intermittency of wind and solar generation makes that power expensive as does the energy intensity of the process of hydrolysis. Green hydrogen production also requires enormous amounts of water, which also adds to the costs.
Egypt has been ambitious to develop its wind and solar resources, and the green ammonia projects are part of that ambition. Earlier this year, the country said it planned to build some 16.5 MW in new solar capacity this year with investments provided by the European Union. It also plans the addition of 10 GW in wind power capacity, with construction set to start in 2026.
The Egyptian government has announced plans to source as much as 42% of the country’s electricity from renewable sources by 2030.
