CAIRO - 1 January 2024: Saudi-based company ACWA Power is discussing the implementation stages of the wind power plant project in West Sohag, southern Egypt, with the Egyptian Ministry of Electricity, to produce 10 gigawatts at a total investment cost of about $10 billion.
“The wind power station project in West Sohag is gigantic and will be implemented in several stages. The Egyptian government has allocated the land,” a company official told Al Arabiya Business.
The official added that the first phase of the project may be around 25 percent of the total targeted capacity, with an investment cost of $2.5 billion. Technical studies related to wind are currently underway, followed by financial closure studies for project financing.
ACWA Power's investments in Egypt amount to about $2 billion, distributed among solar and wind energy stations, with plans to inject new investments into water desalination projects.
"The company is interested in the rehabilitation studies for these stations, which the Egyptian government intends to offer in the future. Once any opportunity in this regard arises, we will pursue it along with green hydrogen,” the official stated.
He explained that the company has signed a memorandum of understanding (MoU) in this regard with the Suez Canal Economic Zone, the Sovereign Fund, and the Ministry of Electricity.
A framework agreement was signed in December, and studies related to the project have begun. ACWA Power aims to produce 500,000 tons per year of green ammonia as an initial stage, reaching 1 million tons in the second stage of the project. The company will commence the project studies soon.
"We have signed a memorandum of understanding with the economic zone, and soon we will sign with the Egyptian Sovereign Fund and the Ministry of Electricity for the framework agreement, then we will start working on the project studies,” he added.
The investment cost of the project is $4 billion, with the production capacity reaching 2 million tons annually with subsequent developments and expansions.
In July, Egypt's Ministry of Electricity, represented by the New and Renewable Energy Authority, signed a document with ACWA Power to allocate and provide land for the initiation of studies and measurements for a 10-gigawatt wind energy project in the West Sohag region.
According to the land allocation document, the project is expected to generate approximately 50,000 gigawatt-hours of renewable energy upon completion, reducing annual carbon dioxide emissions by 2.4 million tons and supplying electricity to around 11 million residential units.
Upon the completion of all project phases, it is estimated that the wind energy project will save Egypt approximately $6.5 billion in annual natural gas costs and create around 120,000 job opportunities. This includes 45,000 direct employment opportunities during the construction phase, as well as indirect employment for approximately 75,000 individuals. Additionally, there will be 2,500 jobs for operation and maintenance after the completion of the entire plant.
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