NEOM Green Hydrogen Company has made an exclusive agreement with Air Products by attaining a 30-year off-take agreement for all the green ammonia produced at the plant
NEOM Green Hydrogen Co. has announced that they have signed a financial agreement with 23 local, regional, and international banks and investment firms for the world’s largest green hydrogen plant, with an investment value of $8.4 billion.
This hydrogen production facility will be built in Oxagon, an industrial city in Saudi Arabia’s NEOM. NGHC has decided upon the engineering, procurement, and construction (EPC) deal with Air Products. They were the nominated contractor and have been laden with the responsibility of the system integrator for the entire facility.
NEOM has joined hands with ACWA Power and Air Products. This collaboration will build the plant with 4 gigawatts of combined solar and wind energy, which will generate up to 600 tons of green hydrogen every single day by the end of 2026. This green hydrogen will be sold in the form of green ammonia as an affordable and sustainable alternative for the industrial and transportation sectors all across the world.
S&P Global, the second-party opinion provider, has given its certification for the inescapable financing structure of the mega project. They have stated that it is in compliance with the principles of green loan structuring and is one of the largest project financings in the pipeline under the green loan framework.
NEOM Green Hydrogen Company has made an exclusive agreement with Air Products by attaining a 30-year off-take agreement for all the green ammonia produced at the plant. This is anticipated to monetise the actual economic potential of clean energy over the entire value chain.
David R. Edmondson, Chief Executive Officer of NGHC, told news portals that they eagerly look forward to working with their partners, NEOM, ACWA Power, and Air Products. They have collectively secured financing for the world’s largest green hydrogen plant with 23 banks and investment firms.
He added that they are setting up a one of its kind facility, the world’s largest green hydrogen project. Despite having no prior experience in this sector and no other plant to look up to, they are entering unchartered territory of the green hydrogen and sustainable energy industry.
He said that NGHC is obliged to its stakeholders for their massive support and loyalty toward the project. This will help the company by utilising its experience and expertise to lead the global transition to a carbon-free future.
Nadhmi Al-Nasr, Chairman of NGHC and Chief Executive Officer of NEOM, said that the record financial support from the investment banks and firms represents the golden potential lying beneath the NGHC’s green hydrogen project. The announcement of the financing closure will help them jump over directly towards setting up the plant, aligned with the vision of NEOM to accelerate renewable solutions.
The monetary support from the Saudi Industrial Development Fund and National Infrastructure Fund will help the project in utilising the ample natural resources available in the NEOM region. This will enable NGHC to lead the world in hydrogen evolution and lay down the foundation for the widespread acceptance of green hydrogen. This move will prove to be a giant step in achieving the sustainable goals of the Saudi Vision 2030.
ACWA Power, the global-level energy transition leader, and the Saudi national champion is proud to be a supporting character in the financial closure of the iconic green hydrogen project. This would strengthen their strong commitment to their partners to the Saudi Vision 2030. They have proven over time their experience in playing with innovative solutions and advanced technology to deliver green, affordable, and sustainable power, said Mohammad Abunayyan, the Chairman of ACWA Power.
Edmondson later notified that the Middle East and North African region has immense potential to transform into a powerhouse for green energy. The availability of large masses of barren lands is the perfect spot for such projects to set up due to the unobstructed sunlight and wind in the area. Previously, this region has held a major position on the global stage as a global energy producer and exporter, and this will make it easier to transition itself into a powerhouse of green hydrogen in the upcoming decades.
The Saudi Arabian Ministry of Industry and Mineral Resources awarded its first industrial operating license to NGHC in early January 2023. This was the stepping stone for the Saudi Kingdom to become the world leader in hydrogen production, besides maintaining its stronghold as a pivotal player in the energy sector.