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Green Hydrogen H2 News

Hydrom Set to Sign Multibillion-dollar Contracts for Six Green Hydrogen Projects in Oman

Arnes BiogradlijaBy Arnes Biogradlija25/04/20232 Mins Read
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Hydrogen Oman (Hydrom) is set to sign official contracts with the developers of six multibillion-dollar green hydrogen projects in Oman. The signing of the first contracts is scheduled for May, with the remainder to be signed in June.

Last month, Hydrom signed term-sheet agreements with the stakeholders of six proposed projects that will require an estimated investment of $20bn. The projects will be located on a total land area of 1,500 square kilometres in Oman’s Al-Wusta and Dhofar governorates, near the ports in Duqm and Salalah. Oman’s Energy & Minerals Minister and Hydrom chairman Salim al-Aufi signed the agreements with the developers.

The agreements include a 47-year contracting period, with seven years allocated for project development and establishment, and 40 years for operating the projects. Developers will receive desalinated water and hydrogen pipelines from Hydrom as part of the agreements.

Developers are expected to bid as part of consortiums and partner with a government-owned entity after the award. The auctions support Oman’s goal to produce 1 million tonnes a year of green hydrogen by 2030.

The green hydrogen projects are expected to cover the full green hydrogen value chain, including renewable energy production, hydrogen production, hydrogen derivatives conversion, and securing offtake for products. The developers are free to choose the end product, whether it is hydrogen, ammonia, methanol, or other derivatives.

Hydrom’s aim is to award two blocks in the Duqm area and four blocks in the Thumrait area in 2023. Acwa Power, the Saudi utility and hydrogen developer leading a team planning to develop an $8.5bn green hydrogen complex in Dhofar, was not included in the term-sheet agreement signing.

Potential Impact

The green hydrogen projects are expected to create significant opportunities for Oman in the renewable energy sector and help the country to achieve its goal of producing 1 million tonnes of green hydrogen per year by 2030. The projects will also help to reduce the country’s carbon footprint and promote its transition to a low-carbon economy.

Hydrom’s agreements with developers show the Omani government’s commitment to supporting private investment in green hydrogen projects. The contracts will provide developers with the necessary infrastructure and resources to establish and operate the projects, making it easier for them to enter the market.

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