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| Mohammed bin Salman, the crown prince and prime minister of Saudi Arabia. Korea Times file |
By Lee Kyung-min
A local public-private energy consortium is seeking to build a green hydrogen and ammonia plant in Neom, Saudi Arabia, the industry ministry said, Wednesday.
This project is the latest effort to spearhead joint growth opportunities between Korea and the Middle Eastern country over the five-stage construction project of $500 billion (662 trillion won) involving the new smart city being built in Tabuk Province, as advanced by the Korea-Saudi Vision 2030 Committee.
Anchoring such developments is the visit of Mohammed bin Salman, the crown prince and prime minister of Saudi Arabia, to Korea, Thursday.
The consortium led by Korea Electric Power Corp. (KEPCO) is joined by two of its state-run peers ― Korea National Oil Corp. and Korea Southern Power Corp. ― as well as steelmaker POSCO and Samsung C&T, the construction and engineering affiliate of Samsung Group.
The consortium plans to sign a memorandum of understanding (MOU) with Public Investment Fund (PIF), the sovereign wealth fund of Saudi Arabia, with about $620 billion in assets under management.
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The agreement is for a total of $6.5 billion to build a 396,694-square-meter plant near Yanbu, a port city on the Red Sea coast of western Saudi Arabia, by 2029, and operate it for 20 years thereafter.
The combined annual production capacity of green hydrogen and ammonia is expected to exceed 1.2 million tons.
The five firms will launch a preliminary feasibility study after reviewing the necessary information provided by the fund before the end of this month.
They will discuss the feasibility of the project in the first quarter of next year and fine-tune business conditions with the PIF.
Green hydrogen is produced by electricity generated from renewable energy, including solar and wind power, or from low-carbon power.
It has significantly lower carbon emissions than grey hydrogen, which is produced by steam from natural gas.
Ammonia is widely considered a more cost-effective and efficient method for transporting hydrogen over large distances, according to market watchers. This is due to its higher energy density by volume and relative ease of handling.
Key trade and construction authorities as well as business executives of Saudi Arabia visited Korea last week to fortify economic ties in the energy and smart construction sectors, among other areas of cooperation. Among them were SABIC, a petrochemical firm, Dussur, a manufacturing and energy firm, ACWA Power, a renewable energy player, the Alfanar power grid and plant, the planning overseers for the Neom new city and Diriyah, a cultural and housing development.
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