Dutch financial institution Invest International and Madoqua have signed an investment contract for the development and construction phase of a green hydrogen and ammonia project in Portugal.
The first phase of construction of MadoquaPower2X involves a 500MW electrolyser and an ammonia production plant, which is to be built at the Sines Industrial and Logistics Zone (ZILS) in Sines, Portugal.
The first ammonia shipment will be delivered in 2029.
Invest International is investing €1m for the design phase and development of the commercial agreements for the future plant.
The green hydrogen sector is a nascent industry, with associated high risks and costs and is often not yet financed by traditional banks.
Invest International chief executive Hans Docter said: “By investing in Madoqua, Invest International contributes to the broader European strategy to accelerate the energy transition and reduce dependence on fossil fuels.
“This investment creates opportunities for the import of green hydrogen to the Netherlands, with Rotterdam as a transit port.
“Investments in the design phase of large-scale projects are necessary in the run-up to realisation.
“The total cost for the design phase of this plant are significant and are not funded by traditional financing institutions.
“It will ultimately lead to the realisation of a plant with a total CAPEX investment of more than €1.3bn, creating around 3000 indirect jobs during the construction phase.
“When the hydrogen and ammonia plant is operational, it will create 115 direct highly skilled jobs.”
Madoqua will build the facility together with a European consortium alongside Power2X and Copenhagen Infrastructure Partners.
An important part of the total investment for Madoqua’s project comes from European funds through the European Hydrogen Bank.
The bank, a financing instrument at the initiative of the European Commission, aims to scale-up of domestic production of renewable hydrogen in the EU and connect the renewable hydrogen supply and demand, by creating investment security.
The MadoquaPower2X project was one of the six winning parties in the European Hydrogen Bank’s first green hydrogen auction in 2024.
A second auction will follow in December 2024 for an amount of €1.2bn.