April 19, 2021

Saudi Arabia and Morocco Lead Green Hydrogen Ambitions in the MENA Region

Stratas Advisors

Subscribers can access the full report from our Global Hydrogen OutlookGlobal Alternative Fuels and Global Transport Fuels Assessment services.  
Not a subscriber? Create an account


The hydrogen race has begun all over the world with the announcements of a future plan for the production of hydrogen, especially green hydrogen. The Middle East and North Africa (MENA) region has announced a number of plans to stay in the global race, including Morocco, Oman, Saudi Arabia and the U.A.E. 

Among the countries in the region, Saudi Arabia and Morocco represent the most important projects in green hydrogen:

Indeed, regarding the Saudi kingdom, the significant funding of US$5 billion coupled with the excellent solar exposure of the kingdom and the ambition of Riyadh to actively start energy diversification considerably increases the chances of success of this project. In addition, Saudi Arabia's ambition to invest in green hydrogen in the northwestern region next to the future city of Neom, which represents the kingdom's ambition to diversify its economy, increases the possibility that this is only the first phase of the project and that consequently other partnerships for green hydrogen see the light of day supported by the financial power of the kingdom.

Morocco is also one of the countries to watch for the production and growth of green hydrogen in the MENA region. Morocco sees green hydrogen as an opportunity for the national market because its main import bill continues to come from fossil fuel imported from the Middle East. Although Morocco is not at the same level as Saudi Arabia's financial powerhouse, the country is off to a good start to reach its energy mix at 52% composed of renewable energy.

In addition to hydrogen export projects, the Kingdom of Morocco intends to use this new energy for its industrial competitiveness in addition to investments in the country's EV charging infrastructure. Moreover, Morocco is aiming to initiate stronger growth of EVs by renewing the existing vehicle fleet of the State as well as public transport. In line with this, the government has set a target for 30% of state-owned vehicles to run on electricity by 2022. Indeed, the largest share of Moroccan exports is the automotive industry with the EU as the main export destination. However, given the EU's plan for imposing carbon taxes on all imports, Morocco's Minister of Industry has officially declared the kingdom's willingness to promote the use of renewable energy in automotive manufacturing sites to avoid adding the carbon tax to operating costs and gain competitiveness in the industry.

The table below provides an abstract of the green and blue hydrogen plans and projects in Morocco and Saudi Arabia, while the full report discusses all upcoming projects in detail including those for Oman and U.A.E.

Summary of Renewable Hydrogen Plans and Projects in Morocco and Saudi Arabia

Country

Location

Company Name

Installed Electrolyzer Capacity

Hydrogen Production Capacity

Targeted Year

Products

Morocco

N/A

MASEN

100 MW

-

2024

Green hydrogen

N/A

Saipem / Alboran Hydrogen / xlinks / IRESEN / ONEE

Between 300 and 500 MW

-

2025

Green hydrogen and green ammonia

Saudi Arabia

Tabuk

ARAMCO

4,000 MW

650 tons per day

2025

Green hydrogen shipped as green ammonia

Note: N/A – information not available

Source: Stratas Advisors, April 2021

In summary, the interest in green hydrogen for MENA countries is important for energy and geographical reasons. Indeed, for most of the countries in the region, solar resources are abundant and many of them also have wind resources, which gives them a geographical advantage to embark on the production of green hydrogen. In addition, the production cost is expected to be lower than in Europe and also competitive with grey hydrogen prices, while transport technologies concentrate a lot of current scientific research and require little modification of the existing infrastructure, which suggests a gradual reduction in transport costs as well. The second reason is energy because it allows oil importing countries to substitute a significant portion of their energy bill with renewable energy, in particular green hydrogen. As for the region’s oil producing and exporting countries, the transition made by European countries to green hydrogen is pushing a certain number of these countries to follow the same energy transition in order to remain competitive in the energy export market. 

The full report focuses on the region's plans for the production and exports of green or blue hydrogen (in the form of alternate products such as green ammonia), thereby complementing the Middle East’s reputation as exporters of crude and petroleum products.

 


Subscribers can access the full report from our Global Hydrogen OutlookGlobal Alternative Fuels and Global Transport Fuels Assessment services.
Not a subscriber? Create an account

Sign-Up for Email Alerts