meed-logo

line1 line2 line3
SIGN IN / REGISTER

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.”

https://image.digitalinsightresearch.in/uploads/NewsArticle/11317662/main2557.jpg
Jennifer Aguinaldo

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Dewa raises Empower stake in $1.41bn deal

    12 February 2026

    Dubai Electricity & Water Authority (DEWA) has announcd it has increased its stake in Emirates Central Cooling Systems Corporation (Empower) from 56% to 80%.

    The transaction was completed through the purchase of 2.4 billion shares and the transfer of the entire ownership of Emirates Power Investment (EPI), which is wholly owned by Dubai Holding.

    The total value of the deal is AED5.184bn ($1.41bn).

    Empower currently holds over 80% of Dubai’s district cooling market and operates 88 district cooling plants across the emirate.

    According to MEED Projects, the UAE's district cooling sector currently has nine projects worth $1.29bn in the pre-execution phase.

    Empower has ownership in four of these projects, which have a combined value of $472m.

    This includes a $200 million district cooling plant at Dubai Science Park, which will have a total capacity of 47,000 refrigeration tonnes (RT) covering 80 buildings

    Empower signed a contract to design the plant, last August, with construction scheduled to begin by the end of the first quarter of 2026.

    The utility is also building a district cooling plant at Dubai Internet City.

    UAE-based TMF Euro Foundations was recently appointed as the enabling and piling subcontractor for the project.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15635949/main.jpg
    Mark Dowdall
  • Bidders line up for Saudi sewage treatment contract

    12 February 2026

     

    Six bidders are competing in the next phase of Saudi Arabia’s long-term operations and maintenance (LTOM) sewage treatment programme, as National Water Company (NWC) moves closer to awarding a contract.

    The contract covers the North Western A Cluster Sewage Treatment Plants Package 11 (LTOM11) and has an estimated value of about $211m.

    The project involves the construction and upgrade of two sewage treatment plants with a combined capacity of about 440,000 cubic metres a day (cm/d).

    As MEED understands, the companies that have submitted proposals include:

    • Alkhorayef Water & Power Technologies (Saudi Arabia)
    • Civil Works Company (Saudi Arabia)
    • United Water (China)
    • Kuzu Group (Turkey)
    • VA Tech Wabag (India)
    • Aguas de Valencia (Spain)

    LTOM11, also known as the North Western A Cluster, forms part of the second phase of NWC’s rehabilitation of sewage treatment plants programme.

    The scheme is being procured on an engineering, procurement and construction (EPC) basis with a long-term operations component.

    The scope also includes a pumping station, surplus discharge lines, SCADA installation and associated infrastructure.

    The main contract was tendered last year, with an award initially expected by the end of 2025.

    It is now understood that NWC is preparing to offer the main contract in this quarter.

    LTOM programme

    LTOM11 follows a series of earlier awards under the programme.

    In January, a consortium of United Water (China), Prosus Energy (UAE) and Armada Holding (Saudi Arabia) won the main contract for the Northern Cluster Sewage Treatment Plants Package 10 (LTOM10).

    This has an estimated value of about SR203m ($54.1m).

    NWC previously awarded $2.7bn-worth of contracts for the first phase of its LTOM programme. This comprises nine packages covering the treatment of 4.6 million cm/d of sewage water for the next 15 years.

    As MEED reported, local contracting firm Alkhorayef Water & Power Technologies won three contracts with a combined capacity of 2.04 million cm/d, nearly half of the awarded total. These three contracts are worth more than SR5.53bn ($1.47bn).

    A consortium of France’s Suez and the local Al-Awael Modern Contracting Group, with its affiliate Civil Works Company (CWC), won two packages worth a combined SR1.84bn.

    A consortium comprising France’s Veolia and Awael-CWC won a single package worth SR1.26bn, and local utility developer Miahona won one package worth SR392m.

    In 2024, a joint venture of CWC and Al-Awael Modern Contracting was awarded a $211m contract for LTOM9.

    As part of the second phase, the main contract bids for LTOM12 (North Western B Cluster) have also been submitted.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15635292/main.jpg
    Mark Dowdall
  • Indian firm wins Dubai Latifa Bint Hamdan road project

    12 February 2026

    Indian contractor Larsen & Toubro (L&T) has won a contract to construct the first phase of the Latifa Bint Hamdan Street development project in Dubai.

    The contract value is between $110m and $275m, according to L&T’s contract classification.

    This project covers 12.2 kilometres of road network from its intersection with Al-Khail Road to Emirates Road.

    The project also includes 8.1km of bridges and will add capacity for about 16,000 vehicles an hour in both directions.

    The scope also involves widening the two-lane dual carriageway to four lanes in each direction.

    The project is scheduled for completion within 36 months.

    The contract was awarded by Dubai’s Roads & Transport Authority (RTA).

    The project is part of the RTA’s estimated AED16bn ($4.3bn) 2024-27 Main Roads Development Plan, which includes 22 projects across Dubai’s road network, as announced in November 2024.

    The development plan includes the construction of new roads and bridges to alleviate traffic congestion at several key locations across Dubai.

    Planning for growth

    The Dubai 2040 Urban Master Plan was launched in March 2021. Its launch referenced studies indicating that the emirate’s population will reach 5.8 million by 2040, up from 3.3 million in 2020. The daytime population is set to increase from 4.5 million in 2020 to 7.8 million in 2040.

    In December 2022, Sheikh Mohammed Bin Rashid Al-Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai, approved the 20-Minute City Policy as part of the second phase of the Dubai 2040 Urban Master Plan. 

    In addition to the road projects, the RTA’s Dubai Metro Blue Line extension also forms part of Dubai’s plans to improve residents’ quality of life by cutting journey times, as outlined in the policy.

    The policy aims to ensure that residents can meet 80% of their daily needs within a 20-minute walk or bike ride. This goal will be achieved by developing integrated service centres with the necessary facilities and by increasing population density around mass transit stations.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15635237/main.gif
    Yasir Iqbal
  • SAR tenders Riyadh section of Saudi Landbridge

    12 February 2026

     

    Saudi Arabia Railways (SAR) has tendered a design-and-build contract for the construction of a new railway line, the Riyadh Rail Link, which will run from north to south Riyadh.

    The tender was issued on 29 January, with a bid submission deadline of 29 March.

    The scope of work includes constructing a 35-kilometre-long double-track railway line connecting SAR’s North-South Railway to the Eastern Railway network.

    The contract also covers the procurement, construction and installation of associated infrastructure such as viaducts, civil works, utility installations, signalling systems and other related works.

    The project is expected to form a key component of the Saudi Landbridge railway.

    Last month, SAR said it would deliver the Saudi Landbridge project through a “new mechanism” by 2034, after failing to reach an agreement with a Chinese consortium for the construction of the project, as MEED reported.

    In an interview with local media, SAR CEO Bashar Bin Khalid Al-Malik said the consortium failed to meet local content requirements and that the project will now be delivered in several phases under a different procurement model.

    The project has been under negotiation between Saudi Arabia and China-backed investors keen to develop it through a public-private partnership.

    Al-Malik said that the project cost is about SR100bn ($26.6bn).

    It comprises more than 1,500 kilometres (km) of new track. The core component is a 900km new railway between Riyadh and Jeddah, which will provide direct freight access to the capital from King Abdullah Port on the Red Sea.

    Other key sections include upgrading the existing Riyadh-Dammam line, a bypass around the capital called the Riyadh Link, and a link between King Abdullah Port and Yanbu.

    The Saudi Landbridge is one of the kingdom’s most anticipated project programmes. Plans to develop it were first announced in 2004, but put on hold in 2010 before being revived a year later. Key stumbling blocks were rights-of-way issues, route alignment and its high cost.

    In April last year, MEED exclusively reported that SAR had issued a tender for the lead design consultancy services contract on the Saudi Landbridge railway network.

    MEED understands that the scope covered the concept design and options for the preliminary and issued-for-construction design stages on the network.

    MEED reported that the launch of a design tender directly by SAR suggested that Riyadh was looking at other options to develop it alongside the Chinese proposal.

    In December 2023, MEED reported that a team of US-based Hill International, Italy’s Italferr and Spain’s Sener had been awarded the contract to provide project management services for the programme.

    If it proceeds, the Saudi Landbridge will be one of the largest railway projects ever undertaken in the Middle East and one of the biggest globally. Based on typical design timeframes, tenders for construction are likely to be ready by mid-2026, although the question of how it will be financed will need to be answered before it can proceed to the next step.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15635220/main.jpg
    Yasir Iqbal
  • Diriyah allows Montage bidders more time

    12 February 2026

    Saudi gigaproject developer Diriyah Company has extended the bid deadline to 14 February for a contract to build a Montage hotel and branded residences within its Wadi Safar masterplan in the Diriyah development.

    The project comprises a 200-key hotel and 30 branded residences.

    The tender was issued in December last year.

    Dubai-based SSH is the lead designer and the supervision consultant.

    UK-headquartered Turner & Townsend is the project management consultant.

    Wadi Safar is one of the original projects announced by Diriyah Company as part of the Diriyah project.

    It is a mixed-use development featuring residential buildings, farm plots, hotels, branded hotel villas, a golf course, an equestrian and polo club, and other leisure and entertainment facilities.

    The main construction works on some of the other assets in Wadi Safar are under way.

    In July last year, MEED exclusively reported that Diriyah Company had awarded an estimated SR8bn ($2bn) contract to construct assets in the Wadi Safar development to a joint venture of local firm Albawani and Qatari contractor Urbacon Trading & Contracting.

    The joint venture is developing the following assets:

    • The Aman Wadi Safar hotel and residences
    • A Six Senses hotel
    • A Chedi hotel and residences
    • A Faena hotel and residences
    • The Royal Diriyah Equestrian & Polo Club (excluding enabling works)
    • The North and South Fairways retail facilities and a mosque
    • The Grove retail facilities, mosque and clinics

    Last year, the company awarded several main construction contracts worth over SR24bn ($6.5bn).

    In November, Diriyah Company awarded two construction contracts with a combined value of over SR5.7bn ($1.5bn), as MEED reported.

    The contracts were officially announced on the sidelines of the Cityscape Global event in Riyadh on 17 November.

    The first contract was awarded to local firm BEC Arabia Contracting Company for the construction of offices in the Media and Innovation District of Diriyah.

    MEED understands that the contract is valued at about $800m.

    This project will deliver office spaces for media companies and creative agencies.

    Within the same district, BEC Arabia will also build residential assets on the Manazel Al-Hadawi plots.

    The other contract, estimated to be worth $900m, was awarded for the main construction works on King Khalid Road. 

    The deal was signed with another local firm, Almabani General Contractors.

    The project involves constructing three interchanges connecting King Khalid Road with the northern and western ring roads.

    The Diriyah masterplan envisages the city as a cultural and lifestyle tourism destination. Located northwest of Riyadh’s city centre, it will cover 14 square kilometres and combine 300 years of history, culture and heritage with hospitality facilities.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/15635172/main.jpg
    Yasir Iqbal