The three agreements invite consortia of local and international companies to develop the production and export of ammonia from green hydrogen, with an expected yield of 0.5 million tonnes of green hydrogen annually
Hydrogen Oman SPC (Hydrom), a subsidiary of Energy Development Oman SAOC (EDO), has signed three agreements to develop the country’s first green hydrogen blocks, awarding the first contract through Phase A Round 1 public auction process, and the other two following the earlier signing of commercial term sheets on 14 March 2023.
Aiming to become a global green hydrogen production hub, Hydrom plays a direct role in delivering Oman’s ongoing initiatives to fostering its hydrogen sector. The signing event was attended by the Minister of Energy and Minerals (MEM) and Chairman of the Board of Directors of Hydrom, HE Eng. Salim Nasser AlAufi, where he announced and signed the contracts with the winning bidders from Denmark, USA, UK, Kuwait, Singapore and Oman. Also present atthe ceremony was HE Dr. Khalfan bin Said AlShuaili, Minister of Housing and Urban Planning, alongside several ambassadors, senior officials from the public and private sectors, and representatives from local and global media.
The total investments in the three projects signed with the consortia of Amnah, Green Energy Oman (GEO) and BP Oman is expected to reach more than $20bn (AED73.5bn). These contracts are expected to yield a total production capacity of half a million tonnes of green Hydrogen per annum from more than 11.5 GW of installed renewable energy capacity at the three sites, each covering an area of 320 sq km in the AlWusta governorate.
Oman: Hydrom awards first green hydrogen projects in the country
Green Hydrogen Blocks
The first of two blocks Z1-01 in the public auction process was awarded to a consortium comprised of Copenhagen Infrastructure Partners (CIP), Blue Power Partners (BPP) and Al Khadra, part of Oman’s Hind Bahwan Group. The consortium will develop around 20 KTPA of green hydrogen from 4.5 GW of installed renewable energy capacity for planned green steel plants located in Port of Duqm, within SEZAD.
The second project was signed with bp Oman for the development of green hydrogen for ammonia production and export. The anticipated annual production for this project is 150 KTPA of green hydrogen from 3.5 GW of installed renewables capacity in Block Z1-03.
As for the third project, it was signed with the consortium of Green Energy Oman (GEO) for the development of green hydrogen for Ammonia export purposes. The consortium includes Oman’s integrated Energy Company OQ, Shell Oman, Kuwait’s state-backed energy investor EnerTech (ETC), InterContinental Energy (ICE) and Golden Wellspring Wealth for Trading (GWWT). This project is expected to produce 150 KTPA of green hydrogen from 4 GW of installed renewables capacity in Block Z1-04.
Furthermore, Hydrom announced the formation of an Advisory Board to oversee the development of common utilitiesinfrastructure, orchestrated by Hydrom in coordination with the lead developers of green hydrogen projects, national utility operators and international developers of green hydrogen infrastructure. Hydrom has signed agreements in support of the initiative and to facilitate collaboration between the parties in the field of green hydrogen pipelines development, including one with OQ Gas Networks (OQGN), the exclusive operator and owner of Oman’s natural gas transportation system.
In addition, Energy Development Oman (EDO) signed a Research and Development MoU with Siemens Energy, a leading global energy technology company, which aims to establish collaboration in the fields of green hydrogen technology, innovation, and expertise exchange.
The Sultanate’s Position
Speaking about the agreements, HE Eng. Salim bin Nasser AlAufi stated, “In the coming years, Oman is poised to become one of the leading countries in green hydrogen production. We are confident that we are on the right path t establish a bright future for renewable and sustainable energy, as outlined by Oman Vision 2040. There is significant demand from major international companies to invest in the Omani hydrogen sector, and we look forward to collaborating with our partners to establish a strong and resilient presence in this promising sector over the next few decades.”
“This step reinforces Oman’s stable investment environment and global position in renewable energy development and is in line with the government’s objectives to stimulate investment in the green hydrogen field. Oman has allocated over 50,000 sq km in the governorates of Al Wusta and Dhofar for green hydrogen projects to be awarded in stages.” stated HE Dr. Khalfan bin Said AlShuaili, Minister of Housing and Urban Planning.
Commenting on the achievements, Eng. Mazin AlLamki, CEO of EDO said “We commend the remarkable milestones accomplished by Hydrom. Undoubtedly, these achievements will solidify the Sultanate’s position in this promisig sector. Oman is well-positioned for green hydrogen production and export thanks to its abundant renewable resources, existing energy and transport infrastructure, industrial ports, and established international partnerships. The development of the green hydrogen economy presents a strategic opportunity for both Omani and international companies to participate and collaborate, driving local and global energy security and economic diversification. This is in line with EDO’s objectives to generate investment opportunities in Oman’s energy sector and maximise financial returns.”
Karsten Plauborg, Partner at Copenhagen Infrastructure Partners, said: “Power-to-gas and green hydrogen will be a key component of every modern energy system and with decades of renewable energy experience CIP is well placed to play our part and unlock the potential of Omani wind, sun, water, and air. Due to the quality of the renewable resources and the sheer size of the land, Oman is poised to become home to idustrial scale clean (decarbonised) steel, fertilizer and other hard-to-abate sectors. And we look forward to working alongside the government and local stakeholders in reducing global carbon emissions at industrial scale, while enhancing productivity and prosperity in Oman.”