Econostrum | Economic News in the Mediterranean

Suez Canal accelerates greening of its economic zone

Written by Frédéric Dubessy on Thursday, April 21st 2022 à 15:35 | Read 267 times

As Egypt prepares to host COP27 in November 2022, it continues its commitment to the transition to a green economy with the signing of two memoranda of understanding concerning the installation of ammonia, hydrogen and green fuel plants in the Suez Canal Economic Zone.

Suez Canal Economic Zone signs two memoranda to promote green fuel and green ammonia (photo: Suez Canal Economic Zone)
Suez Canal Economic Zone signs two memoranda to promote green fuel and green ammonia (photo: Suez Canal Economic Zone)
EGYPT. The General Authority of the Suez Canal Economic Zone (SCZone) continues its commitment to the transition to a green economy. On Wednesday 20 April 2022, it signed two Memoranda of Understanding (MoUs) in this field.

The first was initialled with a consortium composed of the Sovereign Wealth Fund of Egypt (TSFE), the Egyptian Electricity Transmission Company (EETC), the New and Renewable Energy Authority (NREA), the French company EDF Renewables (a subsidiary of EDF) and Zero-Weste Egypt Alliance. It concerns a project to produce 350,000 tonnes of green fuel per year in the port and industrial complex of Ain Soukhna. The project will be carried out in two phases with a total investment of $3bn (€2.75bn). In the first phase, the plant will have a production capacity of 140,000 tonnes per year for ship bunkering. "Commercial operation will take place in the first quarter of 2026," says Yehia Zaki, president of the SCZone.

The second involves the General Authority of the Suez Canal Economic Zone with AMEA Power UAE (a subsidiary of the Emirati group Al Nowais) for the production of green ammonia from green hydrogen (obtained from renewable energies) also at Ain Soukhna. The partners are aiming for a production capacity of 240,000 tonnes per year in the first phase and 390,000 tonnes in the long term.

Eight green protocols signed in 2022

These two memoranda of understanding complete an already strong list of six previous ones signed by SCZone. One of these, on 10 March 2022, was with the Norwegian company Scatec, TSFE, EETC and NREA, for a new green ammonia manufacturing facility based on green hydrogen. It will have an annual capacity of one million tonnes, which can be increased to three million tonnes. Using desalinated seawater and renewable energy from sites specified by the NREA and handed over by the EETC, the plant will require an investment of $5bn (€4.58bn) in two phases with production expected to start in 2025.

Another of the most recent signatures is that of 28 March 2022 with the Danish company Maersk (whose twelve ships sail on green hydrogen) for the supply of clean energy and green fuels. Feasibility studies will be completed by the end of 2022.

"The Egyptian state wishes to sign more projects that support the transition to a green economy (...) All efforts in this regard are in line with Egypt's enormous capacity to produce green hydrogen and green ammonia," commented Egyptian Prime Minister Mostafa Madbouly. The city of Sharm el-Sheikh will host the Conference of the Parties on Climate Change, COP27, from 7 to 8 November 2022, and its dossiers will be presented there.

In December 2021, SCZone also announced a $2.6bn (€2.38bn) contract to build a methanol plant with an annual capacity of 1 million tonnes of methanol and 400,000 tonnes of ammonia. The first phase will be delivered in 2025 after an investment of $1.6bn, and the second in three years ($1bn investment).


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