- Morocco’s OCP to invest $7 billion in an ammonia factory utilizing green hydrogen from renewable fuel for enhanced productivity and low-carbon targets.
- OCP’s strategy aligns with Morocco’s industrial plan to decrease energy imports and promote renewable energy solutions.
- The investment contributes to Morocco’s broader goal of increasing renewable energy capacity and expanding desalination to address drought and water scarcity challenges.
One of the largest producers of phosphates and fertilizers in the world, Morocco’s OCP, said it will invest $7 billion in an ammonia factory utilizing green hydrogen generated from renewable fuel in order to enhance productivity and achieve low-carbon targets.
The chemical manufacturing group OCP, which is also state-owned spent $2 billion on raw materials last year as the conflict in Ukraine drove up worldwide costs.
OCP’s global relevance expanded as a result of the war’s effects on supply, and its promotion of renewable energy is a key component of a Moroccan industrial plan to decrease energy imports.
OCP said it had an agreement to purchase ammonia from North America this year to help with supply issues. In the long run, it intends to strengthen its local supply chain, in part by constructing a facility in southern Moroccan Tarfaya.
The company’s intention to use hydrogen created by electrolysis driven by solar and wind energy as a raw material to create ammonia is part of a $13 billion strategy it outlined in December to switch to renewable energy.
Morocco has made significant investments in renewable energy, in part because of its abundance of undeveloped land, exposure to sunlight and wind, and length of coastline, but also because it lacks oil and gas and has a tense relationship with Algeria, a neighbor, and producer of hydrocarbons.
The government is pushing for more desalination to assist towns and agriculture deal with the effects of years of drought and plans to grow renewable energy to 52% of installed power capacity from 38% by 2030.
A tendering process to increase the desalination capacity at Safi and Jorf Lasfar on the Atlantic will begin early next year, according to state-owned OCP, which has stated its intention to use only desalinated water for industrial activities by 2027.
Its Tarfaya project comprises a desalination plant fueled by renewable energy with a 60 million cubic meter annual capacity to service the industrial complexes.
OCP had revenues of $11.29 bln in 2022, up 40% from 2021, and a net profit of $4.9 bln, up 38%, because to increased pricing. Due to lower prices this year, profits have decreased, but OCP anticipates a recovery in the second half.
