Region primed for global green hydrogen leadership
15 August 2022
Published in partnership with
There have been fewer hot topics in the Middle East and Africa (MEA) over the past 18 months than the development of green hydrogen production.
Ever since Neom, Acwa Power and Air Products announced their $5bn investment in a world-scale green hydrogen production complex as the anchor project of the $500bn Neom development in 2020, energy companies around the world have been racing to establish plans of their own in the region.
Today, there are at least 46 known green hydrogen and ammonia projects across the MEA region, with an estimated total budget of more than $92bn.
Almost all have been announced since the start of 2021, equivalent to nearly two new projects a month.
Competitive advantage
This sudden surge of interest in hydrogen needs little explanation. Due to its climate, the region enjoys the world’s highest solar irradiation levels, enabling the production of some of the cheapest renewable energy anywhere.
The 600MW Al-Faisaliah independent solar photovoltaic (PV) power project in Saudi Arabia, for instance, currently holds the world record for the lowest renewable energy levelised cost of electricity of just $1.04 cents a kilowatt hour.
This electricity from renewable sources is used to electrolyse vast amounts of treated and filtered seawater to extract hydrogen, which in turn is processed with air-derived nitrogen to produce the more easily transportable ammonia.
The ammonia can then be liquefied, compressed and exported by ship to the end-user market, where it can be converted back to hydrogen to be used as a clean fuel or utilised as ammonia for fertiliser or other industrial processes.
Other alternatives include converting the hydrogen to methanol, another more easily transportable fuel product, or piping the hydrogen directly to the end user, either for domestic purposes or for export.
Along with plentiful sunlight, the other main requirement to house the huge solar and wind farms is space, something the region is generally not short of. Oil and gas-importing nations such as Morocco, Ethiopia and South Africa can also benefit from the hydrogen project boom.
First mover status
Aside from the environmental benefits of green hydrogen as a carbon-free fuel, it also offers the oil-exporting states of the Middle East the tantalising prospect of diversifying their dominant crude production position with hydrogen, thereby safeguarding their economies for decades to come as well as enhancing their geopolitical significance.
Speed of capital investment to drive technological leadership and potentially first-mover advantage is arguably going to be another important factor.
From a demand perspective, there is no doubt about green hydrogen’s potential. Demand in Europe alone is forecast to double to 30 million tonnes a year (t/y) by 2030 and to 95 million t/y by 2050.
Thanks to its geographical position, the Middle East is ideally located to meet this demand either by ship or pipeline.
Until recently, green hydrogen may not have been considered financially viable. Today, it could be described as an economic necessity
MEA Energy Week insights
The massive potential and development of a green hydrogen production industry was one of five central themes and insights emerging from the Middle East & Africa Energy Week hosted by Siemens Energy in June.
Yet a live poll of up to 400 delegates as part of Siemens Energy’s Middle East & Africa Energy Transition Readiness Index, produced in partnership with Roland Berger, highlighted that a substantial majority felt that Power-to-X technology – of which hydrogen production is a major component – was slow in meeting its potential.
To put this into perspective, with the notable exception of the Neom-based Helios project and the pilot green ammonia scheme at Ain Sokhna in Egypt, none of the other 44 announced green hydrogen projects in the region have yet to start work on the ground. Many have not even reached a full investor agreement.
The principal challenges revolve around financing, supply and power purchase agreements, land allocations and permitting. Ultimately, even with cheap electricity, green hydrogen is still comparatively expensive to produce after factoring in electrolysis, processing and transportation costs.
There is also some debate over whether the end-user market is ready to pay a premium for cleaner fuel or chemical feedstock.
A related poll question among the Energy Week’s attendees underlined this. Of 11 energy priorities presented, Power-to-X solutions were ranked as the lowest priority in terms of the impact on their companies’ achievement of climate targets.
However, this could change rapidly. The Russia-Ukraine crisis has focused European capitals on the pressing need to diversify fuel sources. Until recently, green hydrogen may not have been considered financially viable. Today, it could be described as an economic necessity.
Transitioning to hydrogen requires huge investment to develop technology, build projects and establish marketplaces that collectively contribute to a cleaner energy future. This coordinated effort by all stakeholders must be supported by policymakers
Nabil al-Nuaim, Saudi Aramco
Encouraging local demand
Equally important is the development of local hydrogen demand. To date, few formal policies or strategies have been announced to stimulate a market for domestic demand, reflected by the fact that almost all of the planned green hydrogen projects pipeline are export orientated.
While this export focus may make sense commercially, there was unanimity among the event’s participants that more could be done to encourage home-grown demand.
“Transitioning to hydrogen requires huge investment to develop technology, build projects and establish marketplaces that collectively contribute to a cleaner energy future,” said Saudi Aramco’s chief digital officer, Nabil al-Nuaim. “This coordinated effort by all stakeholders must be supported by policymakers to achieve success.”
This view was echoed by Khaled Sharbatly, CEO of solar PV panel manufacturer and power developer Desert Technologies. “We need to accelerate the growth of energy in Africa, accelerate energy storage and innovation, and build a regulatory framework where everyone is in sync,” he said.
The development of regulations and policy reforms to provide impetus will be vital for the market to grow, as will associated strategies such as introducing carbon pricing, reducing electricity subsidies, unbundling power networks and incentivising electric vehicle usage.
If it fails to do so, the region may miss the opportunity to capitalise on hydrogen’s potential to create jobs and a local manufacturing industry, diversify economies, and, most importantly, reduce carbon emissions and achieve net zero.
Register for MEED's guest program now to access this article.
Exclusive from Meed
-
Firms prepare bids for NWC sewage treatment package 144 September 2026
-
Egyptian contractor wins Abu Dhabi Ramhan Island deal4 September 2026
-
Dubai sets deadline for Jebel Ali waste-to-energy PPP4 September 2026
-
Egypt to invest $4.5bn in refinery upgrades4 September 2026
-
North Field West platform bidders get extra time4 September 2026
All of this is only 1% of what MEED.com has to offer
Subscribe now and unlock all the 153,671 articles on MEED.com
- All the latest news, data, and market intelligence across MENA at your fingerprints
- First-hand updates and inside information on projects, clients and competitors that matter to you
- 20 years' archive of information, data, and news for you to access at your convenience
- Strategize to succeed and minimise risks with timely analysis of current and future market trends
Related Articles
-
Firms prepare bids for NWC sewage treatment package 14
4 September 2026
At least three contractors are preparing to make offers for package 14 of Saudi Arabia’s long-term operations and maintenance (LTOM) sewage treatment programme, according to sources.
Known as Eastern A Cluster (LTOM14), the package was tendered by the state-owned National Water Company (NWC) in April, with a bid submission deadline of 30 September.
The contract covers the upgrade of six existing sewage treatment plants (STPs), with a capacity expansion of 30,000 cubic metres a day (cm/d) at the Al-Jarodia STP.
This will increase total treatment capacity from about 263,000 cm/d to approximately 293,000 cm/d, with an estimated cost of $180m.
According to sources, the firms preparing to submit bids include:
- Alkhorayef Water & Power Technologies (Saudi Arabia)
- Civil Works Company (Saudi Arabia)
- Miahona (Saudi Arabia)
The latest phase follows the formal signing of a $347m contract between NWC and a Saudi-Chinese consortium for Northern Cluster Sewage Treatment Plants Package 10 (LTOM10) on 2 September.
The same consortium led by United Water (China) is not planning to bid for LTOM14 and is expected to formally sign a contract for LTOM11 in the coming months, a source said.
In April, MEED exclusively reported that the group had won the contract for package 11, which will have a combined capacity of about 440,000 cm/d.
It is also understood that Beijing Enterprises, a bidder for North Western B Cluster (LTOM12), is not preparing to bid for package 14.
In the meantime, the contract for LTOM12 is moving towards award, with bids currently under evaluation.
The contract covers the construction and upgrade of seven STPs with a combined capacity of about 162,000 cm/d. As previously reported, NWC opened financial bids for the project in April.
Future phases
In total, the LTOM programme comprises 19 packages split into two phases. In May 2024, NWC announced it had awarded $2.5bn-worth of contracts in the first phase. Phase two of the programme includes 10 packages covering 117 treatment plants.
In April, MEED exclusively reported that NWC had held several discussions regarding changes in scope details and potential expansions to upcoming projects. This involved “grouping some upcoming projects”.
The request for proposals for LTOM13 was subsequently put on hold and it is now understood that this tender has likely been merged with other packages in the programme.
According to a source, Eastern B Cluster (LTOM15) has also been cancelled and has likely been merged. LTOM15 had comprised two STPs with a total capacity of 152,000 cm/d.
The next contract to be tendered will be Central Cluster (LTOM16), potentially in November, a source added.
Under the original scope, LTOM16 covers the construction of 14 STPs with a total capacity of 153,000 cm/d.
https://image.digitalinsightresearch.in/uploads/NewsArticle/19358188/main.jpg -
Egyptian contractor wins Abu Dhabi Ramhan Island deal
4 September 2026
Egypt-headquartered contractor Rowad Modern Engineering has been awarded the main works contract for the Marina Apartments project on Ramhan Island, Abu Dhabi.
The contract was awarded by the local firm Eagle Hills, which is led by Mohamed Alabbar, the founder and chairman of Emaar Properties.
Rowad’s scope includes structural and architectural works, finishing, and mechanical, electrical and plumbing systems.
The company will also deliver infrastructure works, including utility connections to external networks, testing and commissioning.
The development comprises two residential towers offering 187 residential units.
The works will be carried out under the consultancy supervision of local engineering firm Mirage Leisure & Development.
The latest contract award follows Eagle Hills awarding the local firm Arabian Construction Company (ACC) an estimated AED2.5bn ($680m) construction contract to build about 500 villas at the Ramhan Island development, as reported by MEED previously.
Located off the coast of Abu Dhabi, the Ramhan Island development spans an area of over 4 million square metres.
The overall development includes the construction of 1,800 villas, 900 residences, a hotel and retail facilities.
Mohamed Alabbar launched the Ramhan Island development in May 2024.
https://image.digitalinsightresearch.in/uploads/NewsArticle/19355437/main.jpg -
Dubai sets deadline for Jebel Ali waste-to-energy PPP
4 September 2026
Register for MEED’s 14-day trial access
Dubai Municipality has set a 27 September deadline for developers to submit expressions of interest (EOIs) for its planned Jebel Ali waste-to-energy (WTE) public-private partnership (PPP), according to a source.
The greenfield facility is planned to treat up to 6,000 tonnes of municipal solid waste a day.
The municipality is seeking international and local developers to develop, finance and operate the facility. It is planning to prequalify developers later this year before issuing a request for proposals (RFP) in the first quarter of next year, a source said.
The Jebel Ali facility is intended to support Dubai’s waste-management strategy and its target of reducing reliance on landfill.
Dubai Municipality is being advised by a team led by Abu Dhabi’s Tribe Infrastructure Group, with UK-headquartered Ashurst and Germany’s Fichtner also involved.
It was confirmed to MEED that the project is separate from the planned second phase of the Warsan WTE facility, for which Dubai Municipality issued a consultancy tender in February.
That facility will be located in Warsan 2, next to the Al-Aweer sewage treatment plant. The expansion is expected to increase waste-conversion capacity at the existing Warsan site with an estimated budget of $500m. The consultancy contract has a duration of six years.
The original Warsan WTE plant, Dubai’s first major WTE public-private partnership (PPP) project, reached full commercial operations in 2024.
Located in the Warsan area, the AED4bn ($1.1bn) facility treats 1.9 million tonnes of municipal solid waste annually, generating up to 220MW of thermal energy that is fed into the local grid.
In February 2023, state utility Dubai Electricity & Water Authority (Dewa) and Dubai Waste Management Company signed the power-purchase agreement (PPA) for the project.
Dubai Waste Management Company, the special-purpose vehicle implementing the scheme, reached financial close in June 2021 for the project.
The Warsan project was developed under a 35-year PPP concession by a consortium comprising Dubai Holding, Dubai Aluminium, Tech Group and Itochu Corporation.
The main contractor was a joint venture of Belgium’s Besix Group and Hitachi Zosen Inova of Switzerland.
https://image.digitalinsightresearch.in/uploads/NewsArticle/19354502/main.jpg -
Egypt to invest $4.5bn in refinery upgrades
4 September 2026
Egypt is planning to invest $4.5bn in refinery upgrades, according to the country’s Minister of Petroleum and Mineral Resources, Karim Badawi.
Egyptian refineries are operating at 80% of capacity compared with 66% two years ago, according to Badawi, who wants further increases in utilisation of existing facilities.
“We aim to invest around $4.5bn to develop existing refineries and build new units to reduce imports and achieve self-sufficiency in refined products,” he said in a statement.
In May, Egypt said that it had increased its fuel import budget by almost 40% for the 2026-27 fiscal year amid higher global prices driven by the Iran war, which started when the US and Israel launched an attack on Iran on 28 February.
Brent crude prices are up about a third since the conflict started, trading at more than $90 a barrel for most of this month so far.
Badawi said a decline in Egypt’s oil and gas production between 2021 and 2024 occurred because foreign companies were reluctant to invest in the country’s energy sector due to unpaid government debts.
He said: “We have settled all the debt, which reached $6.1bn in June 2024. As a result, hydrocarbon exploration and production activity grew by nearly 20% this year.
“We are now moving in the right direction to increase oil and gas output gradually.”
Despite the ongoing push to develop projects in the country’s oil and gas sector, several key projects have seen significant delays in recent years.
These include a $2bn hydrocracking complex package that forms part of the wider Assiut oil refinery upgrade project.
Earlier this month, MEED revealed that mechanical completion of the hydrocracking package is now unlikely to be reached until early next year due to complications in the final stages of construction.
The hydrocracking complex package has experienced extensive delays over several years.
In April this year, Badawi called for work to accelerate on the Assiut oil refinery upgrade project, saying it is important for reducing the country’s spending on imported refined products.
At the time, the oil ministry said the project was 88% complete, with trial operations planned by the end of the year.
Assiut Oil Refining Company (ASORC), a subsidiary of state-owned Egyptian General Petroleum Corporation, is the project operator.
France’s Technip Energies is the main contractor, performing engineering, procurement and construction work on the Assiut hydrocracking complex under a $2bn contract awarded by ASORC in February 2020.
https://image.digitalinsightresearch.in/uploads/NewsArticle/19353521/main.jpg -
North Field West platform bidders get extra time
4 September 2026
QatarEnergy has granted contractors additional time to prepare bids for a key tender for the engineering, procurement, construction and installation (EPCI) of large platforms for the giant North Field gas field in Qatari waters.
The tender, issued earlier this year, forms part of the wider North Field West (NFW) project, the third and last phase of the state enterprise’s North Field liquefied natural gas (LNG) expansion programme.
The core scope comprises the EPCI of four production deck modules (PDMs) and associated structures. The new PDMs will increase gas production from North Field reservoirs and provide additional gas feedstock for the NFW LNG development.
QatarEnergy has set 15 September as the deadline for technical bid submissions, while commercial bids are due on 10 November, according to sources.
The previous deadlines for submission of technical and commercial bids were 30 August and 25 October, respectively, MEED previously reported.
The following contractors, among others, are understood to be bidding:
- China Offshore Oil Engineering Company (China)
- Larsen & Toubro Energy Hydrocarbon (India)
- McDermott (US)
- Saipem (Italy)
Before issuing the PDM tender, QatarEnergy awarded McDermott a contract for the EPCI of four offshore jackets that will also support gas feedstock supply for the NFW LNG project. The contract is estimated to be worth about $200m, MEED reported in January.
North Field LNG expansion
QatarEnergy is advancing the three phases of its estimated $40bn North Field LNG expansion project. EPC works on all three giant projects are progressing.
QatarEnergy is understood to have committed nearly $30bn to the first two phases – North Field East (NFE) and North Field South (NFS) – which will lift Qatar’s LNG production capacity from 77.5 million tonnes a year (t/y) to 126 million t/y by 2028.
QatarEnergy awarded the main EPC contracts for NFE in 2021. The project was intended to raise LNG output to 110 million t/y by 2025. The $13bn EPC package – covering the EPCI of four LNG trains, each with a capacity of 8 million t/y – was awarded in February 2021 to a consortium of Japan’s Chiyoda and France’s Technip Energies.
In May 2023, QatarEnergy awarded the $10bn main EPC contract for NFS to a consortium of Technip Energies and Consolidated Contractors Company (CCC). The contract includes two LNG trains, each with a capacity of 7.8 million t/y.
Once fully operational, the first two phases are expected to add 48 million t/y of LNG supply to the global market.
QatarEnergy took the final investment decision on NFW this year, awarding an EPC contract estimated at $8bn to a joint venture comprising Technip Energies, CCC and Gulf Asia Contracting (GAC) in February.
Chiyoda carried out the front-end engineering and design (feed) work for the NFW LNG project.
The NFW scope covers the EPC of two LNG trains with a combined capacity of 16 million t/y, as well as associated facilities for gas treatment, natural gas liquids recovery and helium extraction.
In addition to LNG, NFW is expected to produce about 175,000 barrels of oil equivalent a day of condensate, ethane and LPG.
With all three phases now under EPC execution – and NFE scheduled for commissioning later this year – QatarEnergy is positioning itself to remain one of the world’s largest LNG suppliers over the long term.
https://image.digitalinsightresearch.in/uploads/NewsArticle/19352006/main.jpg