Snapshot: NEOM Green Hydrogen Company (NGHC), a joint-venture of ACWA Power, Air Products and NEOM, closed financing for a US$8.4 billion green-hydrogen (green-ammonia) complex at Oxagon. The facility integrates ~4 GW of dedicated renewable power and targets ~600 tonnes/day of hydrogen (converted to ammonia) for long-term export under a 30-year offtake.
Executive summary
- Investment & partners: US$8.4B project; equal JV between ACWA Power, Air Products and NEOM; ~US$6.1B non-recourse project financing. (NEOM / NGHC)
- Capacity & output: ~4 GW dedicated renewables powering electrolysers sized to produce ~600 t/day of hydrogen, converted to green ammonia for export. (NGHC / Air Products / OECD case materials)
- Timeline: Financial close (May 2023); renewable generation targeted by mid-2026; first ammonia production targeted 2027 (some sources report late-2026).
- Commercial model: 30-year exclusive offtake (Air Products) and a banked project-finance structure that provides a template for future large green-hydrogen projects.
Quick facts
| Total investment | US$8.4 billion (financial close May 2023). (NEOM press release) |
|---|---|
| Partners | ACWA Power, Air Products, NEOM (equal JV). (NEOM / NGHC) |
| Financing | ~US$6.1B non-recourse project finance (syndicate of banks). (industry reports) |
| Renewable capacity | ~4 GW (reported split: ~2.2 GW solar + ~1.6 GW wind in operator notices). (project documents / case studies) |
| Hydrogen output | ~600 tonnes/day (expressed as green ammonia for storage/export). (NEOM / Air Products) |
| Offtake | 30-year offtake agreement (Air Products — exclusive purchaser). (NEOM press materials) |
| Target production | Renewables mid-2026; first ammonia availability 2027 (some reporting cites end-2026). |
Primary sources: NEOM/NGHC press release, Air Products project overview, ACWA Power project materials, Reuters coverage, OECD technical case material.
Why NEOM — strategic rationale
Alignment with national strategy: NEOM’s green ammonia project aligns with Saudi Vision 2030 priorities — economic diversification and building exportable clean-energy industries for hard-to-decarbonize sectors (shipping, fertilizer, heavy industry).
Resource advantage: Oxagon / NEOM leverages high solar irradiance and viable wind resources to achieve competitive renewable LCOE for electrolysis — a material driver of green hydrogen economics at large scale.
Bankable structure: The combination of a long-term offtake agreement and non-recourse project financing reduces merchant exposure for lenders and sets a repeatable commercial model for future projects.
Technical configuration — how the plant is designed to operate
Renewables → Electrolysis → Ammonia synthesis
The plant couples ~4 GW of dedicated renewable generation to a multi-GW electrolyser array sized to the available power. Hydrogen produced via electrolysis is synthesized on-site into green ammonia for storage and export — a commercially pragmatic choice given ammonia’s higher energy density and existing shipping infrastructure.
Electrolyser sizing & production math
Reported project figures (operator materials and OECD case analysis) show electrolyser capacity matched to deliver approximately 600 tonnes/day of hydrogen output. This roughly equates to hundreds of kilotonnes of hydrogen/year (variable by efficiency and uptime) and an annual ammonia output in the order of ~1.0–1.3 million tonnes depending on conversion assumptions.
Logistics & export
Ammonia is stored on site and planned for export through NEOM’s Oxagon port infrastructure. The exclusive long-term purchaser (Air Products) secures demand and simplifies early commercial logistics and revenue forecasting.
Finance, contracts & commercial structure
NGHC reached financial close in May 2023 with approximately US$6.1 billion of non-recourse debt syndicated across international banks; rest of the capital is equity from the JV partners. The plant’s bankability derives from a long-term exclusive offtake arrangement and sizable project finance — a template that helps unlock bank risk appetite for large green H₂ projects.
Air Products holds a dual role as EPC lead for the plant’s ammonia synthesis & gas-handling equipment and as the 30-year exclusive offtaker. Major supply packages (solar panels, wind turbines, electrolysers, storage and port works) are being awarded to global manufacturers under long-lead procurement schedules.
Timeline & current project status
- May 2023 — Financial close (US$8.4B). (NEOM/NGHC)
- 2023–2025 — Construction & procurement (civil works, renewables orders, electrolysers). Industry reporting notes progressive EPC mobilization and contracting activity.
- Mid-2026 — Target renewable assets commissioning (operator guidance).
- 2027 — Target first commercial ammonia availability; alternate sources report late-2026
Environmental & economic implications
Carbon abatement
Operator statements and third-party analyses estimate the plant will displace several million tonnes of CO₂ annually versus conventional fossil-based hydrogen/ammonia production. Exact abatement depends on lifecycle assumptions (grid emissions, manufacturing footprints for electrolysers and PV/wind).
Local economy & exports
Construction and O&M phases create employment across engineering, renewables installation, logistics and port operations. The green ammonia is export-focused — improving Saudi Arabia’s position in clean-energy exports and providing decarbonized feedstock to industrial importers worldwide.
Key risks and reasonable mitigations
- Supply chain & CAPEX pressure. Mitigation: staged procurement, multi-sourcing and price-hedging for long-lead items.
- Electrolyser performance & O&M in desert climates. Mitigation: strong warranty/O&M contracts and local maintenance hubs.
- Market & price risk for green ammonia. Mitigation: long-term offtake, certification for green value and diversified buyer base.
- Water and environmental constraints. Mitigation: renewable-powered desalination and transparent lifecycle water/emissions reporting.
- Regulatory & safety (ammonia handling). Mitigation: robust permitting, international shipping protocols, and port safety investments.
Commercial & investor implications
Equity sponsors and lenders benefit from offtake-backed revenues but must manage construction and commissioning risk.
EPCs & suppliers stand to win multi-year contracts across renewables, electrolysers, synthesis plants and logistics.
Importers & industrial users must prepare downstream infrastructure (storage, certification, conversion if needed) to accept ammonia cargoes.
Six concise recommendations
- Use staged, multi-supplier procurement for electrolysers to avoid single-vendor concentration.
- Require independent lifecycle LCA (emissions & water) with transparent public reporting.
- Index offtake pricing to balance bankability and evolving market rates.
- Accelerate port storage & export logistics to prevent first-shipment bottlenecks.
- Build local O&M capability and spare part inventories to maximise uptime.
- Coordinate green certification frameworks with target import markets to secure premium demand.
Conclusion
The NEOM green hydrogen complex is the largest commercial-scale green hydrogen investment announced to date. Its combination of size, long-term offtake and project financing establishes a marketable model for future export-oriented green hydrogen projects. Successful execution will depend on supply-chain delivery, electrolyser reliability, rigorous environmental management and the development of paying demand for green ammonia. If executed well, NGHC will become a practical template for scaling green hydrogen at industrial scale.
Sources & further reading
- NEOM — NGHC financial close & project announcement
- Air Products — NEOM Green Hydrogen Complex project overview
- Reuters — coverage of financial close and project metrics
- ACWA Power — NEOM project materials & updates
- OECD — NEOM case study (technical / LCA context)
- The National — analysis & reporting
FAQ
Who are the NEOM green hydrogen project partners?
ACWA Power, Air Products and NEOM form the equal joint-venture that owns and delivers the NGHC project. (NEOM press release)
How large is the project and what will it produce?
US$8.4 billion total investment; ~4 GW dedicated renewables powering electrolysers; targeted hydrogen output ~600 t/day — converted on site to green ammonia for export.
When will the NEOM plant start producing?
Financial close occurred in May 2023. Partners target renewable generation commissioning by mid-2026 and first commercial ammonia production in 2027 (some sources report end-2026). Verify with the JV’s latest release for current milestone updates.
Who will buy the ammonia?
Air Products has an exclusive 30-year offtake agreement for the ammonia produced by the facility. (NEOM / project press materials).