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
  • EtihadWE tenders $150m Ajman substation project

    21 July 2026

    The UAE’s Etihad Water & Electricity (EtihadWE) has tendered a contract to build three new substations in Ajman.

    Estimated to cost $150m, the project involves the construction of three new 132/11kV substations in the Bahya, Rumaila and Liwara districts. It also includes associated 132kV underground cabling works to connect the substations to the existing transmission network.

    The bid submission deadline is 10 August.

    According to tender documents, the project will add distribution capacity to support load growth and improve the security of electricity supply in the emirate.

    The scope of work includes site preparation, construction of three substation buildings and foundations, installation of 132kV GIS/AIS switchgear, 132/11kV power transformers and 11kV switchgear, as well as protection, control, Scada and telecommunications systems.

    Etihad WE is responsible for electricity and water services in Ajman, Umm Al-Quwain, Ras Al-Khaimah, Fujairah and parts of Sharjah. The utility has been investing in new substations and transmission infrastructure as electricity demand continues to increase across the Northern Emirates.

    This includes a 132/33/11kV substation project on Al-Marjan Island in Ras Al-Khaimah. Construction work is ongoing on the project, with Maetal Dubai serving as the main contractor.

    EtihadWE is also finalising a new masterplan that will cover network capacity requirements and expansion priorities for the next 10 to 15 years.

    In June, Abdulla Al-Khemeiri, chief operations officer, told MEED: “We are currently reviewing it, and we need to obtain shareholder approval first. Once it is approved, it will be released, hopefully by the end of the year.” 

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17710661/main.jpg
    Mark Dowdall
  • Seven seeks contractors for Dammam water park and hotel

    21 July 2026

     

    Saudi Entertainment Ventures (Seven), a wholly owned subsidiary of the Public Investment Fund, is preparing to shortlist general contractors for the main construction package of its Dammam Water Park & Hotel project in the Al-Hamra district.

    The waterfront development sits on a 324,300-square-metre (sq m) plot.

    A notice was issued to contractors in July, and the client is expected to finalise the shortlist by the end of this month.

    Seven is seeking firms capable of delivering a lump-sum, turnkey solution for both the water park and a 321-key lifestyle hotel. Construction is expected to take 24 months from contract award.

    The water park is designed around five themed zones and will feature what is billed as the world’s first double-tornado/triple-wave waterslide.

    The park will include 21 major rides and attractions, 21 food and beverage outlets, 66 cabanas, parking for 1,100 vehicles and a daily peak capacity of 4,500 guests.

    Slide procurement has already been completed directly by Seven. The selected contractor will be responsible for locally sourcing slide towers, integrating them with rockwork and secondary steel, and installing the units.

    Detailed design and issued-for-construction packages are complete.

    Marine works, piling, dewatering and site utilities are being progressed separately by the existing early works contractor.

    The hotel component covers roughly 31,700 sq m of gross floor area and will offer 321 guest rooms, four F&B outlets, spa and wellness facilities, a family pool, and meeting, incentive, conference and exhibition space.

    The new contractor’s scope includes superstructure concrete works, façade and roof works, mechanical, electrical and plumbing, interior fit-out and landscaping.

    Seven will consider only contractors with demonstrated experience delivering water parks with complex aquatics, theming and rockwork – either directly or through clearly defined subcontractor partnerships – along with a track record in high-end turnkey hotel fit-outs.

    Construction of Seven’s Dammam entertainment complex is currently under way. In October 2023, Saudi Binladin Group won contracts worth around SR5bn ($1.3bn) from Seven to build two entertainment destinations in the Dammam and Al-Khobar areas of the Kingdom’s Eastern Province.

    The Al-Khobar entertainment complex is being built on reclaimed waterfront land. The complex spans around 300,000 sq m and is also known as ‘The Waves’.

    The Dammam entertainment complex spans 360,000 sq m and is being built on reclaimed land on the Dammam waterfront.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17710096/main.jpg
    Yasir Iqbal
  • Al-Ula appoints equestrian village early works contractor

    21 July 2026

     

    Saudi Arabia’s Royal Commission for Al-Ula (RCU) has awarded a contract for early construction works at the Al-Muatadil Equestrian Village.

    The contract was awarded to Al-Khobar-based Al-Shalawi International Company.

    Canadian engineering firm AtkinsRealis is the project management consultant. UK-headquartered Baker Wilkins & Smith and local firm Al-Hoty Company are the cost consultants.

    Dubai-based SSH is the supervision consultant, and UK-based Hopkins Architects is the lead design consultant.

    RCU announced the project plans in March 2023, including the development of an equestrian hub with two arenas that can accommodate 5,000 and 1,400 spectators, respectively.

    The venue will also include grass polo, sand polo and endurance facilities, with capacities of 600, 400 and 600 seats, respectively.

    These facilities will be complemented by visitor amenities, two stable compounds with capacity for 740 horses, and accommodation and retail outlets for event participants and workers.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17710170/main.jpeg
    Yasir Iqbal
  • Contractors await decision on Riyadh airport sewage plant

    21 July 2026

     

    Seven contractors are awaiting a decision on a contract to build a sewage treatment plant at the King Salman International airport (KSIA) development in Riyadh, according to sources.

    It is understood that bids were submitted to King Salman International Airport Development Company (KSIADC) in March, following the tender’s release earlier this year.

    The plant will treat wastewater generated by the airport and surrounding developments, including passenger terminals, runways, residential districts, commercial facilities and logistics areas.

    The facility will have a treatment capacity of 92,000 cubic metres a day. The contract is estimated to be worth SR700m ($187m).

    The bidders (all local) are:

    • Al-Rawaf Trading & Contracting
    • Almajal Alarabi
    • Nesma Water & Energy
    • Safari Company
    • Saudi Services for Electro-Mechanic Works
    • Washnah Contracting
    • Water & Environment Technologies (Wetico)

    The project scope includes the construction of the treatment plant, the installation of preliminary, secondary and tertiary treatment systems, sewage collection and conveyance pipelines, pumping stations, and electrical and control systems.

    US-headquartered Jacobs is acting as the main project consultant. Commercial operations for the plant are scheduled for 2029.

    The sewage treatment plant is one of several water infrastructure packages planned for the airport. KSIADC is also evaluating bids for a separate $30m engineering, procurement and construction contract covering potable water and fire water tanks and an associated pumping station. The same seven companies have submitted bids for that package.

    Earlier in July, MEED exclusively reported that a joint venture of Beijing-headquartered China Civil Engineering Construction Corporation and Dammam-based Mofarreh AlHarbi & Partners had won a deal to undertake the enabling and substructure works for Terminal 6 at KSIA.

    The latest development followed KSIADC’s receipt of prequalification statements from contractors on 1 July for two new packages at KSIA.

    These include the construction of a permanent East-West corridor and landside access roads serving the North and South terminals.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17709281/main.jpg
    Mark Dowdall
  • Dubai Municipality awards Tasreef drainage contract

    21 July 2026

     

    Dubai Municipality has awarded local firm Detech Contracting the engineering, procurement and construction (EPC) contract for the TF-15-C1 package of its Tasreef Rainwater Drainage Network programme.

    It is understood the municipality issued the letter of award for the contract earlier this month, covering the construction of a stormwater drainage system along Al-Wasl Road and communities west of the Dubai Canal.

    The project includes the construction of a gravity-based stormwater pipeline network with diameters of up to 3.5 metres. It is estimated to cost $100m.

    It was tendered in February through the government’s Sewerage and Recycled Water Projects Department, with bids submitted in April.

    The package forms part of the wider Tasreef initiative, which is intended to improve Dubai’s flood resilience.

    The TF-15-C2 package was recently awarded to China State Construction Engineering Corporation for a stormwater drainage network project located along Umm Suqeim Road in the Al-Barsha and Al-Quoz areas of Dubai.

    The project is estimated to cost $162m and includes the construction of about 20 kilometres of new stormwater pipelines. Similar to the C1 package, it is located west of the Dubai Canal and will connect the Al-Quoz 3 and Al-Quoz 4 industrial areas with Al-Quoz 1.

    Separately, Al-Kharafi has won a drainage EPC contract (Ds207) to upgrade an existing pumping station for the municipality, a source said. The package focuses mainly on mechanical works and is valued at about $39m.

    In May, MEED reported that local firm Nael Construction & Contracting had signed a contract with Dubai Municipality to build a sewage and stormwater drainage system in Dubailand.

    The project (DS-204-C1) involves the construction of a drainage system with sewage gravity pipelines of up to 2,200mm in diameter.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/17707980/main.jpg
    Mark Dowdall