UAE-based fertiliser company Fertiglobe (ADX:FERTIGLB) has secured a landmark victory in the pilot H2Global auction, committing to deliver up to 397,000 tonnes of green ammonia to Europe by 2033 from its plant in Egypt. The contract, priced at EUR 1,000 (USD 1,085) per tonne including transport costs, signifies a substantial step towards sustainable ammonia supply.
Commencing deliveries from 2027, contingent upon production initiation and supply availability, Fertiglobe plans an initial shipment of 19,500 tonnes of renewable ammonia in the first year. Under terms set by the H2Global Foundation, Fertiglobe stands to receive up to EUR 397 million from the auction's EUR 900 million budget, translating to a net product price of EUR 811 per tonne or less than EUR 4.50 per kg of green hydrogen, as affirmed by the German economy ministry.
The renewable ammonia will be manufactured at Fertiglobe's existing facility in Ain Sokhna, Egypt, utilizing green hydrogen sourced from the Egypt Green Hydrogen project. This initiative, led by Norwegian renewables company Scatec in partnership with Fertiglobe and Orascom Construction, involves transporting ammonia via a 7 km pipeline to storage tanks at Ein El Sukhna Port. From there, shipments will proceed to the Port of Rotterdam for distribution, managed by German state-owned entity Hintco through annual auctions of 500-tonne batches.
Notably, Fertiglobe has secured a 20-year offtake agreement with Scatec for hydrogen supply, facilitating ongoing production and delivery commitments. This agreement is pivotal for Scatec, holding a majority stake in the Egypt Green Hydrogen project, as it moves towards a final investment decision (FID) anticipated by mid-2025.
The H2Global auction, initiated in late 2022, aimed to secure green ammonia, methanol, and sustainable aviation fuel (SAF) from non-EU nations across three categories. While Fertiglobe triumphed in the ammonia lot, no contracts were awarded for eSAF, prompting redirection of funds towards the renewable methanol lot, reflecting ongoing efforts to enhance sustainable fuel supplies across Europe.
