Saudi Arabia's Public Investment Fund signed a preliminary agreement with South Korea's Posco and Samsung C&T to develop a project for the production and export of green hydrogen, as part of the kingdom's sustainability push to reduce carbon emissions.
The pact includes joint collaborations to conduct feasibility studies, which is one of the conditions to signing the definitive agreements, PIF said in a statement on Tuesday.
The collaboration "is in line with PIF’s intent to increase its investments in green hydrogen and other sustainability-linked projects. PIF plays a vital role in realising the kingdom’s aim to achieve net-zero greenhouse gas emissions by 2060 and this partnership is a natural and significant extension to activities already under way”, Yazeed A Al-Humied, Deputy Governor and Head of Mena Investments at PIF, said.
Saudi Arabia, which pledged to achieve carbon neutrality by 2060, is building one of the biggest green hydrogen projects in the world in Neom, the futuristic mega-city straddling the borders of Egypt and Jordan. The $5 billion project has a 4-gigawatt capacity and can produce 650 tonnes of hydrogen per day. Green hydrogen refers to the clean fuel produced through electrolysis powered by renewable sources.
The new green hydrogen project agreement was signed during the Saudi-Korean Investment Forum held in Riyadh.
“The kingdom of Saudi Arabia has the potential to produce some of the lowest cost renewable energy in the world and is one of the most important countries for Posco, which is planning to develop significant hydrogen production operations” Yoo Byeong-og, head of industrial gases and hydrogen business unit of Posco, said.
Posco is the largest steel manufacturer in South Korea. PIF acquired a 38 per cent stake in Posco E&C in 2015, which is one of the affiliates of Posco.
South Korean construction company Samsung C&T said it was expanding its capability across the entire value chain, from production to utilisation, by focusing on hydrogen at the centre of future energy.
"Samsung C&T will be a close partner to Saudi Arabia, with aims to help position the kingdom to be one of the largest hydrogen exporters globally” Oh Se-chul, president and chief executive of Samsung C&T Engineering & Construction Group, said.
The co-operation between the three parties is set to contribute to the reduction of carbon emissions, as well as the transfer of knowledge and expertise between Saudi Arabia and South Korea, the statement said.
