According to a memorandum of understanding signed with the Tunisian government, Verbund and TE H2 (a joint venture between Total and Eren Groupe SA, holding 80% and 20% shares, respectively) will study the production of green hydrogen in Tunisia. The project, called “H2 Notos,” will use electrolyzers powered by large-scale onshore wind and solar energy, and provide desalinated seawater. In its initial phase, the project plans to produce 200,000 tons of green hydrogen per year.

The green hydrogen produced by the project will be exported through a pipeline. The two companies said in a joint statement on Tuesday that the pipeline will connect North Africa to Italy, Austria and Germany, and the pipeline may be put into use around 2030.

In recent years, hydrogen has been viewed by Europe as the key to reducing the use of fossil fuels in steelmaking and other industries and reducing dependence on Russian gas. Although green hydrogen projects have sprung up in mainland Europe, few have reached the final approval stage because large-scale production and transportation costs are still higher than natural gas.

TE H2 CEO David Corchia said Europe should help and subsidize such investments that contribute to its energy security. He said the first phase of the project will require multi-billion dollar investments to build a hydrogen production plant, 3 gigawatts of renewable energy generation capacity, and a pipeline connecting southern and northern Tunisia. He added that the final investment decision could be made as early as 2027.

David Corchia also said that Verbund, which has a minority stake in the “H2 Notos” project, will be one of the buyers of green hydrogen, and other German and Austrian companies are also interested in it.