Saudi Arabian Refineries Company (SARCO) has signed a non-binding memorandum of understanding (MoU) with Chinese firm Ally Hydrogen Energy Co., Ltd. to develop two key clean energy projects in Jazan Industrial City — a green ammonia production plant and a local hub for assembling and manufacturing hydrogen production and purification equipment.

The agreement marks another step in SARCO’s strategy to build an integrated green hydrogen and ammonia ecosystem in Saudi Arabia and strengthen the Kingdom’s ambitions to become a major player in the global clean energy market.

Under the MoU, the two companies will work together to establish a green ammonia plant in Jazan Industrial City, leveraging the region’s strategic location and industrial infrastructure to support future exports and domestic demand.

The partners also plan to set up a local manufacturing and assembly hub for hydrogen production and purification equipment, aimed at localising advanced technology and creating a supply chain for Saudi Arabia’s emerging hydrogen sector.

In addition, the agreement includes plans to establish a research and development centre in collaboration with Saudi universities to promote innovation in green hydrogen and ammonia technologies and help develop local expertise.

The memorandum came into effect on May 15, 2026, and will remain valid for one year unless extended by mutual agreement.

SARCO said the transaction is expected to have a positive impact on its financial statements by the end of the third quarter of 2028.

The company noted that the agreement builds on earlier strategic partnerships, including an MoU signed with Go Energy in October 2025 and another signed by its wholly owned subsidiary, Clean Energy Company, with AGR Renewable Energy in February 2026.

According to SARCO, the latest agreement represents the selection of the final supplier for the proposed green ammonia plant.  -TradeArabia News Service