Egypt will work with Siemens Energy in a bid to build a “robust green hydrogen industry” in the Middle East nation.

Siemens Energy will work with state power group the Egyptian Electricity Holding Company (EEHC) on a pilot project to deploy an electrolyser of up to 200MW as part of a long-term effort to tap Egypt’s large renewable power resources for H2 production and export, said a statement.

Siemens has a long history of activity in Egypt, and the German industrial giant and its offshoots Siemens and Energy and Siemens Gamesa have in recent years signed major deals there covering wind and fossil power generation.

Siemens Energy CEO Christian Bruch said after signing a memorandum of understanding with EEHC that green hydrogen “has the capacity to significantly decarbonise industry and expand economic diversity. The development of a homegrown hydrogen ecosystem and value chain in Egypt has the potential to deliver a more sustainable and prosperous future for Egyptians”.

The pilot plant will “help to drive early technology deployment, establish a partner landscape, establish and test regulatory environment and certification, setup off-take relations, and define logistic concepts”, said Siemens Energy, without giving further details of possible location or timings of the project.

Egypt is the latest nation in the Middle East and North Africa (MENA) region to set out its stall as a future hub for green hydrogen and eye potential export markets for the energy transition fuel in Europe and Asia.

Oman and Saudi Arabia have already unveiled green hydrogen mega-projects, while Siemens Energy itself is active in plans to tap renewables to help produce green aviation fuel in the United Arab Emirates.

Like those nations, Egypt offers the strong, consistent wind and solar resources needed to drive down renewable power costs, a crucial factor in making green hydrogen competitive against other variants of H2 made using fossil fuels.

Egypt had about 1.5GW of wind in place by the end of 2020, according to the Global Wind Energy Council. The nation’s solar base includes the 1.8GW Benban complex that is among the world’s largest.

Analysts at Rystad Energy in a late-2020 report said Egypt is on course to become the “green powerhouse of Africa”, adding that “four out of the top 10 projects to be developed in Africa in the next five years will be in Egypt”.