Saudi Arabian utility developer ACWA Power has signed a contract worth $900 million relating to the NEOM Green Hydrogen Project.

The signing of the Limited Notice to Proceed (LNTP) agreement relates to the engineering, procurement and construction (EPC) contract for the manufacture of green ammonia, the company said in a bourse statement on Tadawul.  

The Neom Project, jointly developed by ACWA Power, Air Products and NEOM, is said to be the largest green hydrogen production facility in the world. It will use over 4GW of combined renewable energy capacity to generate the power used for producing green hydrogen. The JV has an expected capacity of 1.2 million tons per annum of green ammonia.

ACWA Power owns 33.3% of the NEOM Green Hydrogen Company, alongside Air Products (33.3%) and NEOM Company (33.4%).

The contract duration is six months. Under the LNTP, if financial close is never achieved and project is abandoned, a maximum aggregate exposure can reach up to $300 million to ACWA Power. 

ACWA Power last year signed an agreement with NEOM and Air Products for a $5 billion venture to produce 650 tons per day of green hydrogen powered by renewable energy.

(Reporting by Brinda Darasha; editing by Daniel Luiz)