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Oman signs Green Hydrogen projects worth $20 billion

MUSCAT: In a significant step towards achieving sustainable energy goals, HE Eng. Salim Al-Aufi Chairman of Hydrogen Oman (Hydrom), a subsidiary of Energy Development Oman, signed multiple term sheets with a number of developers in Green Hydrogen Projects.

This milestone follows the preliminary agreements signed with these leading energy companies (referred to as “Legacy Initiatives”) before issuance of a clear regulatory framework by the Ministry of Energy and Minerals being the policy maker and regulator of the sector.

The green hydrogen agreements signed today include 6 projects located in the proximity of Duqm or Salalah ports: BP Alternative Energy Investments Limited (for a project in Duqm and another in Dhofar), Green Energy Oman (GEO), Green Hydrogen and Chemicals SPC (owned by ACME), Hyport Duqm consortium and SalalaH2 consortium. These developments will require an installed capacity of approximately 15GW of renewable energy in Oman and total expected investments around US$20 Bn (including shared infrastructure). These projects are expected to provide over 700 thousand tonnes of green hydrogen which would be further processed in local industries and into energy carriers for export.

The signing of the term sheets and its commercial terms is in compliance with the Royal Decree 10/2023 issued on 16 February 2023 stipulating a clear process to structure clean hydrogen projects and directing the method of land allocation on principles of equal opportunity, fairness and equitability for developers and acknowledging the role of Legacy Initiatives and earlier commitments made with investors.

The Minister of Energy and Minerals, H.E Eng. Salim Al Aufi, commented: “We are delighted to sign these binding commercial term sheets with the first green hydrogen projects developers in our journey towards decarbonization. The Sultanate of Oman has taken several bold steps following His Majesty’s endorsement of the Net Zero target by 2050. While these agreements form the first testimony of our success towards decarbonization, we look forward to signing more agreements once we receive the results of the first public auction round that is currently being conducted by Hydrom.”

Director General of Renewable Energy and Clean Hydrogen at the Ministry, Eng. Abdulaziz Al Shidhani stated: “Today’s milestone is another step to deliver on Oman’s green hydrogen strategy announced on 23rd October last year. We witnessed today commitments made by key developers coming from Belgium, Japan, UK, Netherlands, India, UAE, Kuwait, Singapore, Germany, and Oman.”

Oman has set a clear roadmap towards decarbonization and achieving Net Zero by 2050, and Hydrom has been established as an orchestrator of green hydrogen industry in Oman, regulated by the Ministry of Energy and Minerals. Propelled by values of sustainability, transparency, efficiency, agility, and innovation, Oman has the overarching vision of positioning itself as a leading global green hydrogen hub by enabling the delivery of projects competitively and at scale for the world. Several key government entities aligned to make this success following the directives of His Majesty Sultan Haitham bin Tarik.

Dr. Firas Al Abduwani, acting Managing Director of Hydrom, stated: “The legacy Initiatives have followed Hydrom’s process since its inception and agreed to the main commercial principles set out in the public auction which enables fair and transparent allocation of lands. We are looking forward to closing the final forms of agreements soon with our partners. We will also begin with our bid evaluation process on the public auction to deliver our promise to the government.”

Eng. Mazin Al Lamki, CEO of Energy Development Oman, parent company of Hydrom, added: “Oman is delighted to see the Legacy Initiatives sign the agreements, which are the result of long and hard work from both sides, and marks an important milestone for Oman as a leading green hydrogen hub.”

Hydrom launched its first public auction round for lands in November 2022 and expects to receive bids by March 15th, followed by announcement of the winners towards the end of April 2023.

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