Meed | Neom Green Hydrogen mulls next phase

Neom Green Hydrogen mulls next phase

23 November 2023

Neom Green Hydrogen Company (NGHC) received the first set of wind turbines for one of the two renewable energy plants that will power its integrated green hydrogen and ammonia production facility in early October.

The initial panels for the project’s solar power plant and hydrogen storage tanks are expected to arrive soon. The first air separation units, meanwhile, will be delivered in the first quarter of 2024.

“We are on track to meet our 2026 target commercial operation date, with the first ammonia production expected sometime between mid to late summer of 2026,” David Edmondson, CEO of NGHC (pictured), tells MEED.

Announced in the summer of 2020, the region’s first, and probably the world’s largest, green hydrogen and ammonia production facility reached financial close in May this year. The project required a final investment of $8.4bn.

“The decision to develop the project was made in 2019 in the strong belief that there would be a market for green hydrogen,” explains Edmondson.

“Having Air Products was certainly a major factor in that decision because of their hydrogen knowledge and experience. They already have an existing infrastructure for the production and distribution of hydrogen, including for mobility.”

The US-headquartered industrial gases firm, Saudi utility developer and investor Acwa Power and Public Investment Fund-backed Neom equally own NGHC.

The scale of the integrated project is unprecedented. It will require over 4GW of wind and solar power and 400MW of battery energy storage systems. A 190-kilometre electricity transmission grid will link these to a 2GW electrolysis plant in Neom’s Oxagon industrial city.

The plant will produce up to 600 tonnes of hydrogen daily, which will be converted into roughly 1.2 million tonnes of ammonia a year. Air Products will ship the ammonia to Europe to be cracked back to hydrogen for mobility applications.

Despite some pushback on the business model's efficiency and the feasibility of green hydrogen applications in transport and mobility, Edmondson assures MEED that years of due diligence and compliance with EU carbon intensity policies support the business case. Twenty-three banks are financing the project, he points out.

“The NGHC plant is designed to ensure that the carbon intensity of the end product will be beneath the required threshold in Europe,” he says.

Edmondson acknowledges the premium costs currently involved in a low-carbon-intensity supply chain. However, this is expected to change as companies implement their net-zero commitments and suppliers scale their production to meet rising demand.

Air Products’ key role

In addition to being the exclusive offtaker for over 30 years for the green ammonia produced at the plant, Air Products is also the project’s main engineering, procurement and construction (EPC) contractor.

The firm’s triple role as an equity investor, EPC contractor and offtaker ensures that “we keep the focus on lowest cost of green hydrogen or ammonia”, notes Edmondson.

“Despite being the EPC contractor and a major investor in NGHC, Air Products’ primary objective is to generate revenue out of selling the ammonia that they have agreed to offtake from NGHC, not through the EPC contract,” he adds.

Phase two

With construction well under way for the integrated Neom green hydrogen and ammonia project, NGHC and its shareholders are now looking at a potential second phase.

“The Neom green hydrogen project is not expected to be a single investment,” says Edmondson.

“With all the ammonia to be produced at the plant under construction already sold to Air Products, there remains an interest in looking at additional investments for both the export market as well as the local market requirements for green hydrogen.”

Neom, which aims to be carbon-free and 100 per cent powered by renewable energy, is considering alternative fuels such as green hydrogen to achieve that goal.

Potential applications include mobility, given the plan to develop a rail system and other modes of transport for Neom.

“There was no domestic demand for green hydrogen fuel when the project was originally conceived in 2019. The market is continuing to evolve and we now see a stronger business case for local supply of green hydrogen,” says Edmondson.

The next phase is envisaged to be another large-scale project addressing domestic and international demand for green hydrogen and green ammonia.

Edmondson says more serious discussions about the project’s next phase will be on the agenda in 2024.

Ongoing innovation

The groundwork for the more widespread adoption of green hydrogen in Neom and across Saudi Arabia is under way.

In 2024, Neom’s energy and water subsidiary Enowa will open the Hydrogen and Innovation Development Centre (HIDC), which aims to produce and adopt decarbonised and clean synthetic fuels in partnership with Saudi Aramco.

Initially, the NGHC project at the HIDC will gather operational data from the facility’s first 20MW electrolyser from Germany’s ThyssenKrupp Nucera, which will be used at the NGHC plant.

This will help advance Enowa’s plans with Air Products Qudra to test advanced hydrogen fuel cell-based mobility and logistics solutions at Neom.

Neom factor

As a trailblazing project, Edmondson recognises the many opportunities that Neom has provided.

“We have had excellent support from Neom on both our land and permitting requirements as we have developed the project,” he says.

“We have also benefitted from legislation that allowed the first private grid in the kingdom and were granted the first industrial licence in Saudi Arabia for a green hydrogen plant.

“Neom has certainly risen to the challenge of supporting investors to make the project a reality.”

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Jennifer Aguinaldo

Exclusive from Meed

Consortiums submit bids for Sadara cogeneration plant
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11 September 2026
Heisco wins $359m oil contract in Kuwait
11 September 2026
Abu Dhabi eyes digital requirements for utility projects
11 September 2026
Saudi Arabia tenders next phase of King Saud Air Base
10 September 2026

Consortiums submit bids for Sadara cogeneration plant
11 September 2026
Register for MEED’s 14-day trial access

At least three consortiums have submitted bids for the contract to develop and operate a cogeneration steam and power plant catering to the Sadara petrochemicals complex in Saudi Arabia.

The planned independent steam and power plant (ISPP) project will have a capacity for 400MW-450MW of combined-cycle electricity generation and 550-700 tonnes an hour of steam.

According to sources, bids were submitted for the contract at the end of August.

The consortium bidders include:
- Abu Dhabi National Energy Company (Taqa) / Samsung C&T (South Korea)
- Al-Jomaih Energy & Water (Saudi Arabia) / Albawani (Saudi Arabia) / Sepco 3 (China)
- Acwa (Saudi Arabia), Korea Electric Power Corporation (Kepco) / Doosan Enerbility (South Korea)
Sadara Chemical Company (Sadara) is the project client. It is the downstream joint venture of Saudi Aramco and US-headquartered Dow Chemical.

The estimated $500m project includes construction of a power plant, substations, a seawater intake system and associated switchyards and switchgear.

The project will also include gas turbines and a back-pressure steam turbine, as well as facilities for steam production.

In 2024, MEED exclusively reported that Sadara had prequalified potential bidders for the project. It is understood that the request for proposals was issued towards the end of last year.

The first units at the $20bn Sadara petrochemicals complex in Jubail began production in 2016, and the complex became operational in 2017.

The Sadara complex is designed to produce more than 3 million tonnes a year (t/y) of chemicals and performance plastics, including polyurethanes, propylene oxide, propylene glycol, elastomers, polyethylene, glycol ethers and amines.

Construction is also continuing on the Najim cogeneration facility, which will supply the Amiral petrochemicals complex with up to 475MW of power and approximately 452 tonnes an hour of steam.

Previously known as the Amiral cogeneration independent steam and power plant, the project is being developed by a team comprising Abu Dhabi National Energy Company (Taqa) and Japanese power generation company Jera.

South Korean contractor Samsung C&T is the engineering, procurement and construction contractor for the project.
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Mark Dowdall
UAE plans 150km Boring Company tunnel network
11 September 2026

The UAE plans to build more than 150 kilometres of underground tunnel with US tunnelling firm The Boring Company, in a programme backed by a $3bn funding round the UAE led.

The Series D round values the Boring Company at $23bn, about four times the $5.7bn it was worth after a 2022 funding round. The UAE and affiliated investment entities led the round, which will accelerate a partnership to deploy underground infrastructure across the UAE, the firm said.

The 150km target marks a substantial expansion of the company’s footprint in the country, extending work already committed through the Dubai Loop project. It contrasts sharply with what has been contracted so far. The Boring Company has signed a construction contract with Dubai’s Roads & Transport Authority (RTA) for the pilot phase of Dubai Loop, covering a 6.4km route and four stations linking Dubai International Financial Centre (DIFC) and Dubai Mall. The pilot is expected to cost about AED565m ($154m), with tunnelling due to begin in the second half of this year.

The 150km figure therefore represents an ambition for the wider partnership rather than a contracted volume, with the bulk of the network yet to be tendered, designed or awarded. No timeframe has been attached to the target.

A second Dubai Loop phase will connect Dubai World Trade Centre and DIFC with Business Bay, extending the tunnels to 22km across 19 stations. The total cost across both phases is expected to be about AED2bn ($545m), with completion scheduled within three years. The pilot route is projected to carry about 13,000 passengers a day, rising to about 30,000 a day across the full route.

Other investors in the round include Human Capital, Vy Capital, Valor Equity Partners, Sequoia Capital, Andreessen Horowitz, Temasek, Shamal Holding and Baron Capital. The proceeds will also fund hiring, the scaling of the company’s Loop transit systems in the US cities of Las Vegas and Nashville, and further development of its Prufrock tunnel-boring machines, which it says can operate in both soft ground and hard rock.

The RTA and the Boring Company signed a memorandum of understanding in February last year to explore developing the Dubai Loop, and the construction contract followed in February this year. In May, US engineering firm Parsons was appointed as programme manager for the pilot phase, with a scope covering independent design verification, permitting and multidisciplinary design reviews.

The appointment comes amid a broader shift towards underground construction across the Gulf, as metro, sewerage and highway works in the UAE, Saudi Arabia and Qatar increasingly default to tunnelling.

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Yasir Iqbal
Heisco wins $359m oil contract in Kuwait
11 September 2026
Kuwait-based Heavy Engineering Industries & Shipbuilding Company (Heisco) has been awarded a contract worth KD111.05m ($359m) to develop storage tanks for Kuwait’s Jurassic Light Oil (JLO) export facilities, according to a stock market filing.

The scope of the contract includes civil, mechanical, electrical and instrumentation works, as well as engineering, procurement and construction (EPC) services for the tanks.

The contract was awarded by India’s Larsen & Toubro (L&T), the main contractor for a broader project to develop JLO storage and export facilities in Kuwait, as well as upgrade Kuwait Oil Company’s (KOC’s) existing export network.

The $979.2m main contract for this broader project was awarded to L&T on 15 July.

The contract for Heisco’s scope of work has a time period of 42 months, according to its stock market filing.

Oil crisis

Kuwait’s oil and gas sector is currently in crisis due to the regional war that started after the US and Israel attacked Iran on 28 February.

The war has severely disrupted exports through the Strait of Hormuz, which Kuwait relies on in order to ship crude exports.

It has also disrupted imports of equipment and materials for projects, raising project costs.

Sheikh Nawaf Saud Al-Sabah, deputy chairman and CEO of Kuwait Petroleum Corporation (KPC), the country’s national oil company, has described the current conflict as the biggest oil crisis the country has faced since Iraq’s 1990 invasion.

Despite the significant reduction in crude exports, Kuwait’s state-owned oil companies have continued to tender some projects.

Export facilities

The scope of work under the contract awarded to L&T in July includes the EPC of six new crude oil storage tanks, each with an operating capacity of 618,000 barrels, along with associated facilities, the Mumbai-headquartered company said on 29 July.

The project also involves “the installation of new pipelines and comprehensive upgrades to Kuwait’s existing crude loading and export network, to seamlessly accommodate increased production and enhance the country’s crude handling capabilities”, the Bombay Stock Exchange-listed company said.

L&T also said that the contract will be executed on a lump-sum turnkey basis.

Only two companies submitted bids for the contract in October last year:
- L&T (India): KD303.5m ($988m)
- Petrofac (UK): KD310.6m ($1.01bn)
Following bid submission, KPC discussed the potential cancellation of the tender due to bids coming in significantly over budget and Petrofac becoming ineligible to win contracts in Kuwait.

The contractor was temporarily barred from participating in tenders in Kuwait’s oil and gas sector in December last year.

Petrofac received the ban after the company announced it had applied to appoint administrators, a move that potentially put thousands of jobs at risk and increased uncertainty for projects worth billions of dollars in the Middle East and North Africa region.

Despite discussions about cancelling the tender, KPC ultimately decided to proceed with the award process because it considered the project a high priority.

One source previously told MEED: “Around the same time, projects worth around $8bn were cancelled because of bids coming in over budget, but this one has gone ahead because KPC sees it as an essential project.”

The project was originally tendered in November 2024, with a bid deadline of 1 December the same year. The bid deadline was extended several times before bids were ultimately submitted.
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Wil Crisp
Abu Dhabi eyes digital requirements for utility projects
11 September 2026

Abu Dhabi is set to place greater emphasis on digital and data capabilities in the procurement of future energy and water projects as the emirate prepares for the next expansion phase of its infrastructure network.

Speaking to MEED, Ahmed Mohammed Al-Rumaithi, undersecretary of the Department of Energy, said: “Future utility projects in Abu Dhabi are expected to increasingly include clear digital and data requirements as a core part of the procurement process, alongside the delivery of physical infrastructure.”

The move comes as Abu Dhabi plans to invest more than AED300bn ($81.7bn) in energy and water infrastructure over the next decade under the Department of Energy’s Strategic Framework for the Energy and Water Sector through to 2050.

“Projects will be expected not only to construct assets, but also to demonstrate how operational data is generated, cleansed, governed and exchanged across the full asset lifecycle,” Al-Rumaithi said.

Procurement frameworks are also expected to “prioritise digital readiness, interoperability, cybersecurity and adherence to common data standards” so that new assets can operate as part of an integrated and connected energy and water ecosystem.

AD.WE roadmap

The approach builds on the Department of Energy’s experience with AD.WE, an artificial intelligence (AI)-powered platform that brings together live and historical data from across Abu Dhabi’s energy and water systems.

The department unveiled AD.WE’s development roadmap in October last year, including the full rollout and expansion of the platform beyond electricity and water to district cooling and petroleum products.

The roadmap initially targeted the rollout of phase three of the platform’s development by the fourth quarter of this year, identifying applications including farm irrigation optimisation, intelligent leak detection, consumption intelligence and network planning.

Al-Rumaithi said AD.WE provides a shared operational view of the system and supports operational and regulatory decision-making through agentic AI-driven optimisation and planning.

The platform enables 20% to 30% efficiency gains across capital expenditure (Capex) and operating expenditure (Opex) in targeted parts of the network, according to Al-Rumaithi.

AI planning

AI is also being used to improve long-term infrastructure planning as electricity demand grows, including demand associated with digital infrastructure.

Abu Dhabi’s power demand is expected to double by 2050, with total installed capacity projected to rise from about 25GW to 50GW, according to the Department of Energy.

“AI is reshaping infrastructure planning in two ways. It is driving new electricity demand through digital infrastructure, while also providing more sophisticated tools to understand how demand for energy and water will evolve over time,” Al-Rumaithi said.

AI enables more accurate forecasting, scenario modelling and network analysis, allowing planners to assess future requirements across electricity generation, transmission, water production, cooling and supporting infrastructure.

The strategic framework is supported by an investment of approximately AED35bn a year in “sector development and operations”, Al-Rumaithi said.

He said the increasing use of digital systems will require greater focus on data governance, cybersecurity, transparency and accountability to ensure innovation strengthens the resilience and reliability of essential services.

For utilities, developers and technology providers, Al-Rumaithi said preparation should focus on “high-quality data, robust governance, cybersecurity and workforce capabilities needed to manage increasingly connected infrastructure”.

“Equally important,” he said, “is designing systems that can exchange information securely and operate within a wider digital ecosystem. This enables better coordination between utilities, technology providers and regulators, improving both operational performance and long-term planning.”

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Mark Dowdall

Saudi Arabia tenders next phase of King Saud Air Base

10 September 2026

Saudi Arabia’s Ministry of Defence & Aviation has started the tendering process for the next phase of the King Saud Air Base in the kingdom.

Contractors have been given until 20 October to submit their bids.

The scope of works covers the construction of the headquarters building, administrative buildings, operations and maintenance area, police camp facilities, weapons and ammunition area, residential facilities, airfield facilities and other associated facilities.

The project duration is three years.

The air base spans an area of 383 square kilometres (sq km) in the Hafr Al-Batin area of the kingdom’s Eastern Region.

Contracts worth about SR6.6bn ($1.8bn) for the project’s first phase were awarded early last year.

The joint venture of local firms Isam Khairi Kabbani Group and Alfanar Projects was appointed as the main contractor for the first package, which was worth about SR2.9bn ($783m).

The consortium comprising Riyadh-based Albawani, Shibh Al-Jazira Contracting and Kuwait’s Alghanim International won the second package, worth about $1bn.

According to GlobalData, Saudi Arabia’s defence budget is projected to grow from $68bn in 2027 to $86.3bn by 2031, representing a compound annual growth rate (CAGR) of 6.1%.

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