H2 Global to build new ammonia plant in Morocco

From the newsletter

Green energy company H2 Global Energy is set to build a new green ammonia plant in Morocco following an initial feasibility study on the project. With an annual production capacity of one million metric tons, the facility will strengthen Morocco’s position in the global green energy sector and support the country’s growing hydrogen economy. 

• With this first phase now complete, H2 Global Energy is moving forward with the next steps for the project, including securing financing and finalizing engineering designs. A company delegation has also met with Moroccan government officials to discuss investment opportunities, regulatory frameworks, and other necessary actions to ensure the successful operationalization of the project.

• “The establishment of the green hydrogen and ammonia plant is a significant step towards realizing Morocco's renewable energy ambitions. This facility will not only contribute to the country’s sustainable development goals but also create jobs and stimulate economic growth.,” H2 Global Energy’s Chief Commercial Officer, Waleed AlHallaj has said.

More details

• This project aligns with Morocco’s green hydrogen roadmap, which targets a demand of 30 TWh by 2030 and 307 TWh by 2050, positioning the country as a competitive force in the global green hydrogen industry. To meet this demand, Morocco’s green hydrogen sector is projected to require up to €95 billion in investment.

• To bridge this funding gap, the Moroccan government has rolled out several incentives. As part of the Morocco Offer, a strategic initiative designed to establish Morocco as a leader in the global green hydrogen market, the government dedicated 1 million hectares to green hydrogen projects in 2024, with 300,000 hectares allocated for the first phase. 

• Several prominent investors have already responded positively to this offer, including ACWA Power, TotalEnergies, Enel Green Power, CMMZE Invest UAE and Gaia Future Energy, Siemens Energy, Air Liquide, and Engie and OCP Group. These companies are leading the development of six key hydrogen plants in Morocco. Additionally, Morocco has formed a significant private partnership with the UAE to develop a $25 billion green hydrogen and ammonia project in Dakhla, located in the southern part of the country.

• Morocco has significant potential for green hydrogen production, which is enabled by the country's vast renewable energy sources. It is home to the Noor-Ouarzazate Solar complex, the world's largest concentrated solar power plant, whose 580 MW capacity has been key in fuelling renewable energy in the country. So has been Tarfaya Wind Farm, located south of the country, and which is Africa’s second largest wind farm. Besides demonstrating the Arab nation’s renewable capability, these resources set the foundation for its green hydrogen ambitions. Ultimately, these resources position Morocco as a key player in meeting the global demand for green hydrogen, thus making it a key exporter, especially to Europe.

• Strategically located between the Mediterranean Sea and the Atlantic Ocean, Morocco is often referred to as Africa’s gateway to Europe. This proximity, combined with its vast renewable energy potential, makes the Arab nation an attractive destination for green hydrogen investment and supply chain development, particularly for exports to Europe.

Our take

• Morocco's expansion into green ammonia production is a significant step in its ambitious green energy strategy. While the country has previously focused mainly on green hydrogen production, where it has invested heavily towards becoming a key global player, the move into green ammonia indicates  a diversified approach to sustainable energy.

• The Moroccan government’s use of incentives to attract investors demonstrates its commitment to expanding its green hydrogen sector. While incentives have long been a powerful strategy used by countries to attract foreign and domestic investment, The Moroccan government’s use of incentives to attract investors demonstrates its commitment to expanding its green hydrogen sector. While countries have long used incentives to draw investment, Morocco applies this strategy specifically to advance its renewable energy goals.

• Ambitious as Morocco may be in its green energy goals, it remains subject to many of the challenges bedevilling the green hydrogen sector across Africa, particularly in terms of regulatory challenges and lack of adequate technical expertise. However, given the lengths to which the North African nation has gone to to operationalize green hydrogen production, we are confident that it will develop an effective strategy to overcome these challenges.