In a significant boost to Egypt's clean energy ambitions, Egypt and France have signed a landmark €7 billion ($7.6 billion) agreement to develop a large-scale green hydrogen and ammonia production complex on the Red Sea coast near Ras Shokeir. The ambitious project, led by a private-sector consortium comprising EDF Renewables and Zero Waste in partnership with the General Authority for the Red Sea Ports and the New and Renewable Energy Authority, aims to establish Egypt as a regional hub for green fuel exports.

The agreement, a key outcome of French President Emmanuel Macron's recent visit to Egypt, encompasses the development, financing, construction, and operation of the state-of-the-art facility. Notably, the entire undertaking will be financed and implemented by the private sector consortium, erasing the Egyptian government from any direct financial commitments or infrastructure obligations.

According to a joint statement from the Egyptian Ministries of Industry and Transport, the project will unfold in three distinct phases and is projected to achieve an annual production capacity of up to 1 million tonnes of green ammonia by 2029. The first phase alone will necessitate a direct investment of €2 billion and target an initial output of 300,000 tonnes of green ammonia per year.

The agreement was formally signed by EDF Renewables Chairwoman Beatrice Buffon and Zero Waste Chairman Amr El-Sawaf, alongside prominent Egyptian energy officials. The total investment across all three phases is estimated to reach €7 billion, entirely funded by the project company.

Egypt’s Deputy Prime Minister for Industrial Development and Minister of Industry and Transport, Kamel El-Wazir, emphasized that it aligns perfectly with national directives to localize the green hydrogen industry and position Egypt as a leading force in progressive environmental practices on both regional and global scales.

To power the massive facility, the government has allocated a substantial 368 sq. km of land in Ras Shokeir for the generation of solar and wind energy. Additionally, 1.2 million sq. meters will be dedicated to the construction of the integrated industrial plant itself. The project's infrastructure will also include a 400-meter export jetty with a 17-meter draft and a 7-km transmission corridor. A dedicated seawater desalination unit will be established to meet the project's water requirements.

The investment is structured for cost recovery over a 50-year period, with the Egyptian state set to benefit through licensing fees, land-use charges, export duties, and taxes, all to be paid in US dollars.

Beyond the direct financial benefits, the project is expected to generate thousands of jobs during both the construction and operational phases. The consortium has pledged to prioritize local labor, aiming for a 95% Egyptian participation rate in the project's workforce, including comprehensive training programs.

Furthermore, the initiative will boost local green energy component manufacturing like electrolyzers, solar panels, and wind turbines.

El-Wazir emphasized its alignment with Egypt’s climate commitments under the Paris Agreement and COP27, alongside its potential to substantially reduce greenhouse gas emissions and conserve natural gas reserves by offering sustainable alternatives for the energy and industrial sectors.

In a final note, the minister highlighted the strategic advantage of providing green fuel for ships navigating the Suez Canal and developing a new Red Sea port under the Red Sea Ports Authority, all without imposing any fiscal burden on the Egyptian government.