June 12, 2025 [Reuters]- A $5.8 billion project on South Africa’s east coast seeks to use the country’s infrastructure and cheap renewable power to make some of the world’s cheapest green ammonia for clients in Europe and Asia, an executive said.

South Africa is vying with other African nations, including Egypt, Morocco and Namibia, to meet rising demand in the European Union and Asia for hydrogen and ammonia described as green because they are produced from renewable energy.

The project can use existing infrastructure and ample wind and solar energy. A desalination plant on site, operated by South Africa’s biggest salt-maker by volume Cerebos, for example, will also help to offset capital expenditure.

Benchmarking global indices, Loubser said green ammonia was priced at around $760 a ton free-on-board, but the Coega operations could produce the commodity for less.

“We can produce at $650 a tonne and still give an investor a very attractive double-digit internal rate of return,” he said, adding that the company was in talks with customers in Europe, Japan and Korea.

According to South Africa’s Department of Trade, Industry and Competition, the country could approach $1 per kilogramme of green hydrogen by 2050.

Loubser said subsidy programmes in countries such as Australia and India may pose a threat to South Africa, but that it should remain competitive in the nascent sector.

Strategically situated along a major shipping route, Hive’s project could eventually quadruple production to 4 million tpa, Loubser said.