By:Zawya

The US-based Hecate Energy will join hands with Tosyali Algerie, one of Africa’s largest steel manufacturers with facilities in Oran in northwest Algeria, to build a large green hydrogen plant to support the production of green steel in the North African nation.

Newspapers in the OPEC nation said the project was the theme of talks on Wednesday between representatives of the two companies and Rachid Hachichi, Director General of Algeria’s state oil operator Sonatrach.

They quoted Sonatrach as saying in a statement that the “integrated green hydrogen project” would be based on studies conducted in 2024 by those two firms.

A new memorandum of understanding (MOU) is expected to be signed between Sonatrach, Algeria’s state owned Sonelgaz company, Hecate and Tosyali enabling the implementation of this integrated project, the statement said.

It said the project would be executed in two phases, the first of which will be for completing studies aimed at assessing the project's feasibility and profitability.

“The second phase will focus on the construction of the project, which will contribute to achieving the goals in the field of energy transition,” the statement added without mentioning project cost, location and production capacity.

Algeria, a major gas producer, has launched plans to develop renewable energy and green hydrogen projects as part of a strategy to trim reliance on conventional electricity and save fossil fuels for export.

Officials said the European Union and the German Federal Ministry for Economic Cooperation and Development (BMZ) are sponsoring the relevant studies, which cost around 28 million euros ($32 million).

The plan focuses on building institutional and technical capacities in the field of renewable energy, creating appropriate conditions for implementing renewable energy projects and providing tools for developing the green hydrogen economy, they said.

It also includes establishing an information database on national potential for green hydrogen applications, in addition to providing planning and monitoring tools to achieve energy savings and reduce emissions.

Algeria aims to increase the share of renewable sources in its energy mix to nearly 27 percent by 2026 with the production of around 15 gigawatts (GW). The level is set to grow further in the next five years.

In 2024, six European and Algerian energy companies joined forces to assess the feasibility of large-scale green hydrogen production in Algeria and its transport to Europe through the planned 'SoutH2 Corridor' project.

The 3,300-km hydrogen pipeline aims to connect North Africa with Italy, Austria, and Germany, potentially supplying 40 percent of Europe’s hydrogen import target by 2030.