TA’ZIZ, one of the leading constructors in the diversification drive within the industrialized push for the UAE, announced that it would award an EPC contract, worth $1.7 billion, to South Korea’s Samsung E&A for the establishment of one of the world’s largest methanol plants located at Al Ruwais Industrial City in the region of Al Dhafra Abu Dhabi, enabling the broader aim of economic diversification within the UAE.

The First Methanol Production Plant in the UAE

The new facility will annually produce 1.8 million tons of methanol, the first of its kind in the UAE. The plant will open by 2028 and will use clean energy supplied by the national grid, thereby making it one of the world’s most energy-efficient methanol plants. The facility, when opened in 2028, will help strengthen the position of the UAE as a significant player in chemicals globally.

Mashal Saoud Al-Kindi, CEO of TA’ZIZ, said, “This landmark EPC contract award is a significant step in realizing TA’ZIZ’s vision to drive the UAE’s industrial growth by creating a world-scale integrated chemicals ecosystem in Al Dhafra region.”

Strengthening the UAE’s Global Chemical Position

The partnership between TA’ZIZ and SAMSUNG E&A attempts to further the UAE’s position as an international leader in the production of sustainable and advanced methanol. Hong Namkoong, President and CEO of SAMSUNG E&A, expressed pride in the collaboration, saying, “SAMSUNG E&A is honored to receive this recognition, highlighting TA’ZIZ’s and our commitment to driving industrial innovation, diversifying the UAE’s economy, and enabling sustainable growth.”

Also read: Aramco Partners with Carbon Clean and Samsung E&A for Advanced Carbon Capture Demonstration

Expansion of the UAE’s Chemical Industry

The first phase will be capable of producing 4.7 million tons per annum (mtpa) of a portfolio of chemicals that includes methanol, low-carbon ammonia, polyvinyl chloride (PVC), ethylene dichloride, vinyl chloride monomer, and caustic soda. It is the first time that the UAE will produce these chemicals in-country, contributing to TA’ZIZ efforts to strengthen local industry and drive diversification.

By 2028, TA’ZIZ would increase chemical production, and thereby it will further the strategic objectives of speeding up industrialization in the region. The plant is going to reduce further dependence on imports by the country and help the developing chemical sector of the country.

Lhyfe, a producer and supplier of renewable energy is raising up to € 11 million in funding from Sweden’s Klimatklivet investment program, facilitated by the Swedish Environmental Protection Agency and co-funded by the European Union. Lhyfe will fund the construction of a new renewable hydrogen production facility in Vaggeryd, Jönköping County, southern Sweden.

Vaggeryd is an important location strategically between Stockholm, Gothenburg, and Malmö. Therefore, it can supply hydrogen and meet the region’s growing demand.

Increasing Demand for Hydrogen for Transport Decarbonization

With transport sector decarbonisation, the demand for renewable hydrogen will always keep going up. In this respect, the new production facility will introduce green hydrogen production with a capacity to produce up to 4.4 tons a day using a 10MW electrolyser. The facility’s hydrogen will support the development of a network throughout southern Sweden.

The green hydrogen will power transport, heat local industries, and support production, playing a bigger role in reducing emissions.

A Key Step in Sweden’s Green Hydrogen Strategy

Lhyfe’s Vaggeryd plant will be a key step in Sweden’s green hydrogen development strategy. It will begin production in 2027 and provide customers with its first kilogram of renewable hydrogen. This project adds to Lhyfe’s previous Klimatklivet grant for a Trelleborg facility, expanding the hydrogen network in southern Sweden.

The Vaggeryd project’s investment will cover 35% of costs, supporting development, design, equipment, and construction efforts.

Also read: Lhyfe and Masdar Partner to Boost Green Hydrogen Production

Lhyfe is a green hydrogen leader with facilities in France and Germany and additional facilities under construction across Europe. Lhyfe’s Bouin plant has been running since 2021, and by mid-2024, the company will employ 200 people across 12 countries.

Sara Wihlborg, Country Manager for Lhyfe Sweden, said, “We are delighted to have been awarded this investment support, which marks our second project in Sweden to receive backing from Klimatklivet. Green hydrogen is a key enabler in the transition, strengthening the competitiveness of Swedish industry while increasing domestic energy security with locally produced energy.”

She added, “Additionally, the waste heat generated during the production process will be utilized in the existing district heating network in Vaggeryd. Lhyfe already delivers green hydrogen to industrial customers in Sweden, and with the two facilities now granted Klimatklivet support, Lhyfe ensures a robust and competitive supply solution for green hydrogen for our customers in Sweden moving forward.” 

The hydrogen production process will also generate waste heat to support Vaggeryd’s local heating network.

The next steps include securing approvals, permits, and a final investment decision to move the project forward. After securing the permits, Lhyfe will build the facility and create a strong green hydrogen network in Sweden.