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Saudi ACWA Power Signs MoU to Develop Green Hydrogen Project in Tunisia

The memorandum of understanding was signed by Fatma Thabet Chiboub, Tunisia’s Minister of Industry, Mines and Energy, and Marco Arcelli, CEO of ACWA Power. (Asharq Al-Awsat)
The memorandum of understanding was signed by Fatma Thabet Chiboub, Tunisia’s Minister of Industry, Mines and Energy, and Marco Arcelli, CEO of ACWA Power. (Asharq Al-Awsat)
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Saudi ACWA Power Signs MoU to Develop Green Hydrogen Project in Tunisia

The memorandum of understanding was signed by Fatma Thabet Chiboub, Tunisia’s Minister of Industry, Mines and Energy, and Marco Arcelli, CEO of ACWA Power. (Asharq Al-Awsat)
The memorandum of understanding was signed by Fatma Thabet Chiboub, Tunisia’s Minister of Industry, Mines and Energy, and Marco Arcelli, CEO of ACWA Power. (Asharq Al-Awsat)

Saudi Arabia’s ACWA Power signed a memorandum of understanding with the Tunisian Ministry of Industry, Mines and Energy, with the aim to study the implementation of a new project to produce about 600,000 tons of green hydrogen annually in 3 stages, and export it to the European Union.

Under the MoU, ACWA Power will work to establish, operate and maintain electricity generation units with a production capacity of up to 12 gigawatts of renewable energy, including storage systems and transmission lines, in addition to a water desalination plant, electrolysis devices, and infrastructure projects to allow direct connection to the main pipeline.

The company said that the first phase will include the installation of renewable energy units with a capacity of four gigawatts, an electrolysis capacity of two gigawatts, in addition to battery storage facilities, to produce 200,000 tons of green hydrogen annually.

The project aims to export green hydrogen through “South 2”, a hydrogen pipeline developed as an initiative by the European Network of Transmission System Operators for Electricity (ENTSO-E). It is classified as a project of common interest by the EU. This pipeline connects Tunisia with Italy, Austria, and Germany.

The project will support Tunisia’s national strategy for green hydrogen and its derivatives, which was announced in October 2023. The strategy involves implementing an ambitious action plan to export over six million tons of green hydrogen to the EU by 2050, according to ACWA Power.

Ouael Chouchene, Tunisia’s Secretary of State for Energy Transition, said: “This project aligns perfectly with the Tunisian government’s national green hydrogen strategy... which targets an annual production of 8.3 million tons of green hydrogen and byproducts by 2050.”

He added: “We are confident that this agreement with ACWA Power will leverage Tunisia’s strengths, including its strategic geographic location, existing infrastructure, and skilled workforce, to create a more sustainable future for the country.”

For his part, Marco Arcelli, CEO of ACWA Power, said: “We are excited to work with the Tunisian government on this visionary project, bringing our expertise in renewables, desalination and green hydrogen to build a bridge with Europe to help reach its decarbonization targets. This project can also contribute significantly to economic growth, job creation, and sustainable energy solutions, exemplifying our shared vision for a greener future.”

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IMF: Middle East Conflict Escalation Could Have Significant Economic Consequences

Displaced families, mainly from Syria, gather at Beirut's central Martyrs' Square, where they spent the night fleeing the overnight Israeli strikes in Beirut, Lebanon September 28, 2024. REUTERS/Louisa Gouliamaki
Displaced families, mainly from Syria, gather at Beirut's central Martyrs' Square, where they spent the night fleeing the overnight Israeli strikes in Beirut, Lebanon September 28, 2024. REUTERS/Louisa Gouliamaki
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IMF: Middle East Conflict Escalation Could Have Significant Economic Consequences

Displaced families, mainly from Syria, gather at Beirut's central Martyrs' Square, where they spent the night fleeing the overnight Israeli strikes in Beirut, Lebanon September 28, 2024. REUTERS/Louisa Gouliamaki
Displaced families, mainly from Syria, gather at Beirut's central Martyrs' Square, where they spent the night fleeing the overnight Israeli strikes in Beirut, Lebanon September 28, 2024. REUTERS/Louisa Gouliamaki

The International Monetary Fund said on Thursday that an escalation of the conflict in the Middle East could have significant economic ramifications for the region and the global economy, but commodity prices remain below the highs of the past year.

IMF spokesperson Julie Kozack told a regular news briefing that the Fund is closely monitoring the situation in southern Lebanon with "grave concern" and offered condolences for the loss of life.

"The potential for further escalation of the conflict heightens risks and uncertainty and could have significant economic ramifications for the region and beyond," Kozack said.

According to Reuters, she said it was too early to predict specific impacts on the global economy, but noted that economies in the region have already suffered greatly, especially in Gaza, where the civilian population "faces dire socioeconomic conditions, a humanitarian crisis and insufficient aid deliveries.

The IMF estimates that Gaza's GDP declined 86% in the first half of 2024, Kozack said, while the West Bank's first-half GDP likely declined 25%, with prospects of a further deterioration.

Israel's GDP contracted by about 20% in the fourth quarter of 2023 after the conflict began, and the country has seen only a partial recovery in the first half of 2024, she added.
The IMF will update its economic projections for all countries and the global economy later in October when the global lender and World Bank hold their fall meetings in Washington.
"In Lebanon, the recent intensification of the conflict is exacerbating the country's already fragile macroeconomic and social situation," Kozack said, referring to Israel's airstrikes on Hezbollah in Lebanon.
"The conflict has inflicted a heavy human toll on the country, and it has damaged physical infrastructure."
The main channels for the conflict to impact the global economy have been through higher commodity prices, including oil and grains, as well as increased shipping costs, as vessels avoid potential missile attacks by Yemen's Houthis on vessels in the Red Sea, Kozack said. But commodity prices are currently lower than their peaks in the past year.
"I just emphasize once again that we're closely monitoring the situation, and this is a situation of great concern and very high uncertainty," she added.
Lebanon in 2022 reached a staff-level agreement with the IMF on a potential loan program, but there has been insufficient progress on required reforms, Kozack said.
"We are prepared to engage with Lebanon on a possible financing program when the situation is appropriate to do so, but it would necessitate that the actions can be taken and decisive policy measures can be taken," Kozack added. "We are currently supporting Lebanon through capacity development assistance and other areas where possible."