Scatec ASA, a leading provider of renewable energy solutions, together with partners ECHEM and MOPCO, has finalized Heads of Terms for the supply of renewable ammonia from Egypt to Yara Clean Ammonia, the world's largest ammonia trader and distributor. This agreement marks a pivotal development in promoting renewable energy efforts in Egypt, showcasing Scatec ASA's commitment to sustainable practices and partnerships.

Last year, Scatec, the Egyptian Petrochemicals Holding Company (ECHEM), and Misr Fertilizers Production Company (MOPCO) (the "Sponsors") executed a joint development agreement and a shareholder agreement to collaborate on producing renewable ammonia.

Under the agreement, the Sponsors will establish and operate renewable energy facilities totaling up to 480 MW, along with a 240 MW electrolyzer facility to produce renewable hydrogen. This hydrogen will serve as a primary feedstock for generating renewable ammonia at MOPCO's existing ammonia production plant in Damietta, Egypt, targeting an annual production capacity of up to 150,000 tonnes of renewable ammonia.

Additionally, Scatec secured a letter of intent with the European Investment Bank ("EIB") to facilitate long-term financing for the project. This partnership highlights EIB's commitment to supporting the development of renewable hydrogen and ammonia projects in Egypt, aligning with global efforts to promote sustainable energy solutions. The EIB's involvement not only underscores its financial support but also signifies confidence in the project's potential to contribute significantly to Egypt's renewable energy goals and enhance environmental sustainability in the region. This collaboration reflects a strategic alignment between public and private sectors to drive forward innovative solutions in the energy transition landscape.

Scatec CEO Terje Pilskog expressed satisfaction in finalizing the Heads of Terms with Yara Clean Ammonia, highlighting it as a significant endorsement of Scatec's standing in Egypt. He emphasized Scatec's strategic focus on advancing renewable hydrogen initiatives linked to current ammonia production capabilities. Pilskog underscored Scatec's commitment to leveraging its expertise and lessons learned from previous projects in collaboration with Yara, anticipating fruitful outcomes from their partnership in the future.

Yara Clean Ammonia's CEO, Hans Olav Raen, emphasizes the strategic importance of their diversified portfolio of asset-backed and offtake agreements for low-emission ammonia. He highlights that the newly secured project in Egypt will enhance their sourcing capabilities of renewable ammonia, positioning Yara Clean Ammonia as a preferred off-taker. Raen underscores that upon finalizing the investment decision, the renewable ammonia produced will bolster their ability to reliably meet the needs of customers across various market sectors.

Egyptian Minister of Petroleum and Mineral Resources, H.E. Tarek El Molla, emphasized that the signing ceremony marks progress in collaborating with private sector partners to advance Egypt's national low carbon hydrogen strategy through practical projects. This partnership aims to attract renewable hydrogen investments, reduce project implementation risks, and support Egypt's ambition to establish itself as a leading hub for green hydrogen regionally and globally.