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Saudi Arabia in first position for the production of green and blue hydrogen: KAPSARC study

RIYADH: Saudi Arabia’s vast renewable energy potential and natural gas reserves will help it produce one of the cheapest green and blue hydrogens in the world, according to a new study.

The findings were published this week in the “Economic and Resource Potential of Hydrogen Production in Saudi Arabia,” which was commissioned by the King Abdullah Petroleum Studies and Research Center (KAPSARC).

At current household gas prices and considering the average auction price of awarded renewable energy projects in 2020, the production cost of blue and green hydrogen is estimated at $1.34/kg and $2.16/ kg, respectively.

In addition, the cost of delivering hydrogen by 2030 from the western region of Saudi Arabia to the port of Rotterdam, via the Suez Canal, will average between $3.50/kg and $4.50 $/kg depending on hydrogen carrier used.

For context, the expected cost of green hydrogen production in Europe in 2030 is estimated to average between $3/kg and $5/kg.

The study also highlighted the geographical distribution of the Kingdom’s resources, highlighting that the eastern region is more likely to produce and export blue hydrogen, while green hydrogen production is perfectly suited to the region. west, far from local oil and gas clusters.

“As countries commit to a low-carbon future, Saudi Arabia’s hydrogen production prospects present huge opportunities for the Kingdom and other countries in their energy transition,” said Fahad Al-Ajlan, president of KAPSARC.

The KAPSARC study follows the Kingdom’s announcement in March of the official start of construction of Helios, a $5 billion green hydrogen plant at NEOM, as the country pushes ahead with export plans of carbon-free fuel in about four years with most of the demand expected. come from Europe and Asia.

The Kingdom’s aspiration to hydrogen is in line with the launch of the Saudi Green Initiative launched in October 2021, in which the country pledged to invest more than $186 billion (SAR 700 billion) to contribute to the growth of a green economy.