Egypt has been heralded as a potential global leader in green shipping due to its strategic location and vast renewable resources. But as the initial excitement around new green tech projects fades, the critical question emerges: how real is the hype? We sat down with industry experts to understand the major hurdles facing green bunkering uptake and how Egypt can navigate these uncertainties to convert its grand plans into ground-level reality.

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For starters, the global market for green hydrogen-based fuels is still very underdeveloped. “At the moment, the market is driven by harsh realities when it comes to the economics of hydrogen projects, green industry fellow at regional climate thinktank Carboun Institute Fadi Al Noaimi, told us. We’re seeing a global trend” of scaling back some projects — which could be viewed as a “necessary market correction,” Al Noaimi added.

The lack of locked-in uptake agreements is the biggest challenge facing green bunkering, as it suggests there is no business case to advance many of the announced projects, Dii Desert Energy Research Director Chiara Aruffo told EnterpriseAM.

A regional case in point: The UAE-based renewables giant Masdar said last month it will redirect energy from its USD 6 bn mega solar and battery project from green hydrogen production to power AI. “Today, green hydrogen is under pressure, and the market is shrinking. A lot of people who went into this venture are out,” CEO Mohamed Jameel Al Ramahi said after the announcement.

In global numbers: At least 50 clean hydrogen projects have been publicly cancelled in the last 18 months, representing 4 mn tonnes per annum (mtpa) of capacity, according to the Hydrogen Council’s Global Hydrogen Compass 2025 report (pdf) out earlier this month. In a best-case scenario, some 20 to 30% of the world’s announced clean hydrogen projects — representing 9-14 mn mtpa — are expected to make a final investment decision by 2030.

But this could soon change thanks to new regulatory measures by the International Maritime Organization (IMO), the Norwegian maritime industry advisor DNV’s recently published Maritime Forecast 2050 expects. Demand for low-carbon shipping fuels — including LNG — is expected to hit 25 mn tonnes of oil equivalent (mtoe) by 2030, up from the 17 mtoe predicted in DNV’s last year.

While only 1% of the current binding offtake for green hydrogen and ammonia is earmarked for shipping fuels, this figure is predicted to grow — largely due to the IMO and the European Union’s regulatory mandates, according to industry CEOs surveyed by the Hydrogen Council. IMO’s new rules would be “essential to generate a greater demand for green hydrogen-based fuels shipping” and to clearly define their climate advantages, Aruffo agrees.

The IMO is set to formally adopt next month its Net Zero Framework (NZF) — aiming for a 20% reduction in emissions by 2030 and net-zero by 2050 through a set of emission reduction mandates and penalties. The NZF was approved last April and the IMO is scheduled to take a final vote for its adoption next month.

But the success of the IMO mandate would be highly dependent on the trajectory of oil and gas prices. For example, it is expected to be more affordable for shippers who use high-sulfur fuel oil to pay the IMO penalties up to 2030 before they are incentivized to switch to cleaner alternatives, according to the Hydrogen Council report. Very low sulfur fuel oil (VLSFO) is a type of fossil-derived fuel mandated by the IMO in 2020 to limit harmful sulfur emissions, and it is now used by the industry’s largest ships.

That being said, governments committed to decarbonization would need to go beyond the “cut or pay” regulations to incentivize the industry. “Without a clear price on carbon emissions and the removal of subsidies for fossil fuels, it’s difficult for green hydrogen and other renewable energy solutions to compete on cost alone. This is a critical barrier to their widespread adoption,” Aruffo told us. Other forms of support from governments could include direct financial backing, which Al Naoimi said would be “inevitable to de-risk the projects.”

The next few years will be critical for the green fuels market, as industry and governments enter a period of “recalibration.” Competing priorities regarding energy security, competitiveness, and cost-efficiency will inform this calibration, according to surveyed CEOs in the Hydrogen Council report. The next period is expected to replace the hype with “realism and pragmatism,” with only the strongest projects advancing — which can lead to a more resilient industry, the report says.

Egypt could benefit from doubling down on green methanol, given that the scaled deployment of the clean fuel is more feasible than its hydrogen-based counterparts — green hydrogen and ammonia. Ports representing 45% of the world’s bunkering capacity either have in place or are planning methanol bunkering infrastructure, suggesting more infrastructure readiness.

Geography isn’t Egypt’s only competitive advantage. Ain Sokhna port is among the world’s top 80 ports described as having “well-developed expertise in managing chemical products,” indicating a “strong readiness to also handle hydrogen-based fuels,” according to the International Energy Agency’s Global Hydrogen 2025 Review (pdf). Coupled with its strategic location along the Suez Canal — connecting Europe and Asia, Ain Sokhna port emerges as a favorable location for early adoption of low-emissions hydrogen-based fuel bunkering.

REMEMBER- Egypt is planning to begin commercial methanol bunkering operations by 2027 at its Suez Canal ports and has successfully tested a bunkering operation for a container ship in East Port Said back in 2023.

While the future of the green bunkering market hinges on global market dynamics beyond us, there are many measures we can take to ensure we secure a piece of any future market. For starters, Egypt should double down on the concept of “common user infrastructure” — clustered shared facilities and assets that can be utilized by multiple developers as in the case in Ain Sokhna, Aruffo said. “This collaborative approach prevents the duplication of essential facilities like pipelines, allowing developers to pay a tariff for shared access rather than incurring the significant capital expenditure of building their own. This makes these large-scale projects more economically viable,” Aruffo explained.

Common user infrastructure isn’t only good for cutting costs, it is also critical for saving our resources. For example, shared desalination facilities using seawater could “help mitigate water usage concerns in the water-intensive green hydrogen projects,” Aruffo explains. This reduces the risk of individual projects depleting local freshwater resources or facing prohibitive costs for water sourcing.

A more centralized approach for planning hydrogen infrastructure could also raise investors’ confidence in projects’ executionability, Aruffo said. Hydrom — the master-planner agency of Oman’s hydrogen strategy — is a good example where having a dedicated entity that takes “ownership of the process” for screening projects, tendering, and master planning infrastructure could help streamline the process, reduce costs, and provide reassurance to investors, she added.

The bottom line: While Egypt holds a prime position to lead in green bunkering, its ambitions hinge on global market dynamics and the future of oil and gas prices. Still, robust government support, clearer incentives, and de-risking measures could help the country secure a big share of the future market.

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