ACWA Power, POSCO sign renewable hydrogen/ammonia agreement

Saudi Arabia's ACWA Power has signed a memorandum of understanding with South Korea's POSCO Holdings to jointly develop renewable hydrogen and ammonia, the companies said July 19.

The goal of the venture is to decarbonize POSCO Group's power generation and steel manufacturing businesses as well as serve its other Korean clients.

"With tangible project commitments in Saudi Arabia and Oman, ACWA Power is at the forefront of scaling up green hydrogen, whose output—ammonia—will lead to the outcome of decarbonizing entire industries, including hard to abate industrial activities like steel manufacturing," Paddy Padmanathan, Vice Chairman and Chief Executive Officer at ACWA Power said.

Platts assessed the price of Middle East conventional ammonia at $995/mt July 19 versus an assessment of $1,058.50/mt for blue ammonia, according to S&P Global Commodity Insights data.

Renewable hydrogen and ammonia produced via green field investments would support POSCO's target to produce 500,000 metric tons of hydrogen globally by 2030, the companies said.

POSCO has capacity to produce 42.9 million mt of steel as of 2021, making it one of the largest steel producers in the world.

ACWA Power, alongside Saudi Arabia's NEOM and Air Products, is developing a renewable hydrogen project in Saudi Arabia.

When complete in 2026, the project aims to produce 1.2 million mt of renewable ammonia per year.

S&P Global's Hydrogen Production Assets database shows ACWA Power is also a participant in the H2Oman project in Oman for production of ammonia.