NEOM Green Hydrogen Company closes $8.4bn deal for production facility

Saudi Arabia’s NEOM Green Hydrogen Company (NGHC) has signed financial documents with a consortium of local, regional and international banks and investment firms for a green hydrogen production facility at a total investment value of $8.4bn.

The company’s financial agreements were concluded through a diverse mix of local, regional and international banks and financial institutions, along with an Euler Hermes tranche with no fewer than 23 institutions investing in the project.

The green hydrogen production plant is currently being built at Oxagon in Saudi Arabia’s NEOM region.

“I’m excited to announce that NEOM Green Hydrogen Company together with ACWA Power, Air Products and NEOM has achieved another significant milestone in our project by achieving financial close on the world’s largest green hydrogen plant with 23 banks and investment firms,” the company’s CEO David R. Edmondson said in a statement.

“We are grateful for the significant support and commitment of our shareholders and the investment community to achieve project financing at this scale and look forward to leading the charge on the global transition to a carbon-free future.”

The non-recourse financing structure for the project is certified by S&P Global as adhering to green loan principles and is one of the largest project financings put in place under the green loan framework.

NGHC also concluded the engineering, procurement, and construction agreement with Air Products as the nominated contractor and system integrator for the entire facility at a value of for a value of $6.7bn.

The company secured an exclusive 30-year off-take agreement with Air Products for all the green ammonia produced at the facility, which is expected to unlock the economic potential of renewable energy across the entire value chain.

“Air Products is the exclusive off-taker and will absorb the full production volume of the green hydrogen produced in the form of green ammonia at the NGHC facility to serve global mobility and industrial markets,” said Seifi Ghasemi, chairman, president and CEO of Air Products.

NEOM’s green hydrogen project

NGHC, which is equally owned by Air Products, ACWA Power and NEOM, is building a green hydrogen plant to produce green ammonia for export to global markets, with the first shipment expected from NEOM’s port in the first quarter of 2026.

Earlier in January 2023, Saudi Arabia’s Ministry of Industry and Mineral Resources awarded its first industrial operating license to NGHC, paving the way for the kingdom to become one of the world’s biggest hydrogen producers while maintaining its position as a key player in the energy industry.

Globally, many countries have ambitious plans for green hydrogen, but GCC states have unique advantages that could allow them to lead the transition to hydrogen. Hydrogen is a highly efficient energy carrier and upon combustion, the only by-product of this zero-emissions fuel is water—making it an ideal medium for electrification and substitution of fossil fuels.

GCC countries, including Saudi Arabia, the UAE and Oman are working on hydrogen projects with the kingdom’s $5bn green-hydrogen plant in NEOM expected to be completed in the coming months.

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