Reports in the Egyptian press are asserting that the Copenhagen-based logistics provider A.P.Moller-Maersk has signed what is described as a “preliminary agreement” to buy 51% of a wind farm in the Zafarana complex which is located at city of Ras Ghareb on the coast of the Red Sea. It appears these wind farm assets may have a generation capacity of over 500 megawatts. According to reports in various sources, the price of the investment has not been finally agreed.
In addition, Maersk is said to be planning the construction of a methanol fuel production facility at Ain Sokhna in the Suez Canal Zone, possibly using the power generated by the wind farms.
When approached, Maersk said that it did want to comment on “rumours or speculation”.
Maersk has been talking to the Egyptian government for several years. In March 2022 the two sides signed a “partnership agreement to explore the establishment of large-scale green fuel production in Egypt”. This seemed to be agreement to commence feasibility projects for the establishment of methanol production and the present agreement appears to be the fulfilment of this potential.
Maersk commented to Ti that these investments were handled by C2X Ltd which is an investment company set-up by AP Moller Maersk Holding and Maersk to, in-part, invest in non-hydrocarbon based fuels. However, judging by the previous discussions with the Egyptian government, Maersk is directly concerned with these investments.
It appears that the Egyptian initiative is an important of Maersk’s shift to methanol. Despite the CEO of Maersk commenting in September that Maersk was “not going all-in on methanol”, the company seems determined not merely to buy methanol fuelled ships but also enable the construction of a methanol production infrastructure across the world, with advanced planning haven taken-place for production complexes in Spain and Denmark as well as in Egypt. Maersk is also buying methanol made from land-fill derived methane in the US. Presumably, further production facilities will be built at major shipping hubs in Asia as well.
Author: Thomas Cullen
Source: Ti Insights