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Saudi-Japanese Feasibility Study for Producing Clean Hydrogen for Local, Int’l Markets

Saudi Arabia recently issued the first license in the “Oxagon” industrial city for the NEOM Green Hydrogen Company. (Asharq Al-Awsat)
Saudi Arabia recently issued the first license in the “Oxagon” industrial city for the NEOM Green Hydrogen Company. (Asharq Al-Awsat)
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Saudi-Japanese Feasibility Study for Producing Clean Hydrogen for Local, Int’l Markets

Saudi Arabia recently issued the first license in the “Oxagon” industrial city for the NEOM Green Hydrogen Company. (Asharq Al-Awsat)
Saudi Arabia recently issued the first license in the “Oxagon” industrial city for the NEOM Green Hydrogen Company. (Asharq Al-Awsat)

Japan’s Marubeni Corp. has agreed to study clean hydrogen production in Saudi Arabia together with the Kingdom’s sovereign Public Investment Fund (PIF).

Saudi Arabia, a leading oil-producing nation and a key player in the Organization of the Petroleum Exporting Countries, is looking to add other types of energy sources, including cleaner fuels and renewables, to diversify its economy.

According to Reuters, Marubeni and PIF, central to the Kingdom's goal to cut reliance on oil, agreed to conduct a feasibility study for producing clean hydrogen for both domestic and international markets.

In early February, Saudi Arabia’s Ministry of Industry and Mineral Resources issued the first industrial operating license for NEOM Green Hydrogen Company (NGHC) - an equal joint venture between NEOM, ACWA Power and Air Products.

This step came as part of NEOM’s efforts and its ambitious vision to develop innovative sustainable solutions to address key global challenges, the foremost of which is climate change.

When complete, NGHC will be the largest at-scale green hydrogen production company in the world based in Oxagon, home to advanced and clean industries in NEOM, with a next generation port and fully automated and integrated supply chain and logistics network.

It is expected that the NGHC plant will start producing green hydrogen from 100% renewable energy sources in 2026, with production of up to 1.2 million tons of green ammonia annually – a figure equivalent to 600 tons of green hydrogen per day.

In other news, Saudi oil giant, Aramco, signed a letter of intent to become a potential minority stakeholder in a new powertrain technology company (PWT), to be established by Geely and Renault Group. The new company will be dedicated to internal combustion and hybrid powertrain technologies.

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China Vows 'Necessary Spending' to Hit Economic Growth Target

FILE PHOTO: A man walks in the Central Business District on a rainy day, in Beijing, China, July 12, 2023. REUTERS/Thomas Peter/File Photo
FILE PHOTO: A man walks in the Central Business District on a rainy day, in Beijing, China, July 12, 2023. REUTERS/Thomas Peter/File Photo
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China Vows 'Necessary Spending' to Hit Economic Growth Target

FILE PHOTO: A man walks in the Central Business District on a rainy day, in Beijing, China, July 12, 2023. REUTERS/Thomas Peter/File Photo
FILE PHOTO: A man walks in the Central Business District on a rainy day, in Beijing, China, July 12, 2023. REUTERS/Thomas Peter/File Photo

Chinese leaders pledged on Thursday to deploy "necessary fiscal spending" to meet this year's economic growth target of roughly 5%, acknowledging new problems and raising market expectations for fresh stimulus on top of measures announced this week.
The remarks, which included guidance to the government to support household consumption and stabilize the troubled real estate market, came in an official readout of a monthly meeting of top Communist Party officials, the Politburo. The September meeting is not usually a forum for macroeconomic discussions, which suggests growing anxiety over slowing growth momentum.
The world's second-largest economy faces strong deflationary pressures due to a sharp property market downturn and frail consumer confidence, which has exposed its over-reliance on exports in an increasingly tense global trade environment.
A wide range of economic data in recent months has missed forecasts, raising concerns among economists that the growth target was at risk and that a longer-term structural slowdown could be in play.
"New situations and problems" demand a sense of "responsibility and urgency," state media reported, citing the Politburo meeting.
China's central bank on Tuesday unveiled its most aggressive monetary easing since the pandemic, flagging cuts to a broad range of interest rates and a 1 trillion yuan ($140 billion) liquidity injection into the financial system, among other steps.
Beijing is considering pumping up to 1 trillion yuan into its biggest state banks to increase their capacity to support the struggling economy, primarily by issuing new special sovereign bonds, Bloomberg News reported on Thursday.
Chinese real estate shares jumped more than 8% and their Hong Kong peers soared 9% after the Politburo announcement, leading broader gains in the stock market. The yuan and Chinese bond yields also rose.
The Politburo said the government should "promote the stabilization of the real estate market", expand a whitelist of housing projects that can receive further financing and revitalize idle land, according to the readout.
Officials "will respond to people's concerns, adjust home purchase restriction policies, lower existing mortgage rates and improve land, fiscal, tax and financial policies as soon as possible to push forward the new model of property development", it said.

The Politburo's endorsement of further stimulus "represents a strategic shift in macro policy, from piecemeal policies to a highly orchestrated package in the right direction," said Bruce Pang, chief economist China at Jones Lang LaSalle.
"A pick-up in government spending will probably be sufficient to drive a turnaround in business confidence, market sentiment and economic activities, helping China to catch up with potential trend growth."
China will make good use of its ultra-long special sovereign bonds and local government special bonds to support government investment, the Politburo vowed, according to Reuters. It pledged to boost income for low- and middle-income groups and support consumption as well as improve childbirth support policies.
The ministries of finance and civil affairs said on Wednesday they would distribute a one-time allowance to disadvantaged people ahead of a national holiday in early October. They vowed to prioritize employment and promote wage growth in response to steep pay cuts in some sectors and soaring youth unemployment.
"Falling inflation and private sector deleveraging mean that rate cuts alone won't dramatically boost domestic demand," said Capital Economics analyst Julian Evans-Pritchard. "Doing so would require more substantial fiscal support. There are some hints of that in the (Politburo) communique."
As flagged by central bank Governor Pan Gongsheng on Tuesday, top policymakers said China would lower the reserve requirement ratio and implement "forceful" interest rate cuts.