Oman offers land concessions for 47 years for green hydrogen projects

According to a top official in the Ministry of Energy and Minerals, developers of green hydrogen projects in the Sultanate of Oman will be qualified for land concessions lasting 47 years as well as other benefits.

Director General of Renewable Energy and Hydrogen, Eng Abdulaziz al Shidhani, highlighted that registrations for the competitive bidding procedure, for which land allocations comprising blocks of around 320 sq km each will be based, commenced earlier this week.

According to Eng Al Shidhani, “What we are offering to investors is a (concession) for a period of 47 years starting from the signing of the project development agreement and sub-usufruct award.” He added that the already low land fees would be further cut by up to 100% during the development stages. “Land leasing starts with a floor of 20 baizes per square meter, which eventually would be based on a competitive bidding procedure.”

The official noted that the Omani government will be eligible to earn base royalties (beginning at 5% in kind) and surplus royalties when speaking at a media briefing earlier this week. Additionally, a government-owned organization—currently OQ, the state-owned integrated global energy group—must be given a 20% interest in the project. Additionally, he added, project creators must pay all appropriate business taxes.

The scope of green hydrogen projects includes integrated development, which includes the production of green hydrogen, the conversion of derivatives, and the offtake of output. Water and hydrogen pipes are examples of common infrastructure that will be put out to separate bids.

The government, on the other hand, is not obligated to offtake any electrical output from the project, mainly because, according to him, it has its own strategy for acquiring new renewable energy capacity to meet the nation’s energy needs.

The official emphasized that only serious developers would receive land allocations. “Oman is seeking legitimate investors; those who will not be using the assigned land within a certain term for their intended project will have the land taken away from them,” the statement reads.

While the Ministry of Energy and Minerals will serve as the industry’s regulator and policymaker, Hydrogen Oman (Hydrom), a new state-owned organization set up as a subsidiary of Energy Development Oman, will closely oversee the industry’s implementation (EDO).

“Hydrom will manage the entire operation, coordinating the offtake amongst the investors and managing the shared infrastructure, the bidding procedure, etc. The Public Authority for Special Economic Zones and Free Zones, the existing energy and water companies, the gas network, and other utilities will all be under its purview, he continued.