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Oman to sign hydrogen deals by June

21 February 2023

 

Hydrogen Oman (Hydrom) expects to sign project development and sub-usufruct agreements with the successful bidders for the land blocks being auctioned for integrated green hydrogen projects in Oman by June.

Hydrom has received proposed changes to both documents from interested bidders and expects to reissue the updated agreements by 22 February.

These are understood to be legally binding agreements that will be issued on a "use-it-or-lose-it basis", according to industry sources.

Consortiums and individual companies are preparing to bid by 15 March for the land blocks being auctioned for integrated green hydrogen projects in Oman, as MEED has previously reported.

An extension to the tender closing date cannot be ruled out despite Hydrom expecting to award the contracts in May or April, one of the sources tells MEED.

Hydrom is understood to have received statements of qualification (SOQs) from prospective developers to take part in the auctions.

According to industry sources, the following companies and consortiums have submitted SOQs: 

  • Abu Dhabi National Energy Company (Taqa, UAE) / Masdar (UAE) / Jera (Japan)
  • Alfanar Company (Saudi Arabia) 
  • Acme Group (India)
  • EDF (France)
  • BP (UK)
  • Fortescue (Australia)
  • Korea Electric Power Corporation (Kepco) / Posco / Samsung Engineering (South Korea)
  • Marubeni (Japan) / Linde (France) / Dutco (UAE) / OQ (local)
  • Mitsui (Japan)
  • Shell (Netherlands) / OQ (local) / Intercontinental Energy (Singapore) 
  • Total (France)

Hydrom has yet to officially issue a list of prequalified bidders.

It is understood that not all of these companies or consortiums have purchased the request for proposals (RFP) document for the land block auctions.

MEED understands Hydrom will provide developers with desalinated water and hydrogen pipelines as part of the agreements.

Phase A of the land auctions will comprise two bid rounds for integrated green hydrogen projects in Duqm and Thumrait.

According to Hydrom, two blocks will be awarded in the Duqm area by the end of the first quarter of 2023, while four blocks will be awarded in the Thumrait area by the end of 2023.

Oman expects winning developers for the first phase of its programme to deliver integrated projects that cover the full green hydrogen value chain. These projects are expected to include:

  • Renewable energy production: wind/solar mix to ensure competitive levelised cost of hydrogen
  • Hydrogen production: could be polymer electrolyte membrane or alkaline electrolysers
  • Hydrogen derivatives conversion: end product, whether hydrogen, ammonia or methanol, among others, is up to the developers
  • Offtaker: developers are expected to secure offtake for their products

The investor roadshow for the second bid round is expected to be held in April, followed by the qualification phase in May. Contracts for this round are due to be awarded by December.

The planned auctions support Oman’s goal to produce 1 million tonnes a year of green hydrogen by 2030.

Developers are expected to bid as part of consortiums and partner with a government-owned entity after the award.

Hydrom mandate

Hydrom was set up in early 2022 with a directive from Oman’s Sultan Haitham bin Tariq al-Said to structure and accelerate the development of the green hydrogen sector in the country.

Hydrom is wholly owned by Energy Development Oman (EDO) and regulated by the Energy & Minerals Ministry.

EDO’s mandate includes creating a master plan for the sector, including delineating government-owned land areas, structuring associated large-scale green hydrogen projects, managing the process for their allocation to developers and overseeing their execution, as well as facilitating the development of common infrastructure, connected ecosystem industries and hubs.

It has the right to purchase a minimum of 5 per cent and up to 20 per cent of shares in the green hydrogen projects being set up in the country.

The sultanate has a rapidly growing green hydrogen and green ammonia pipeline. There are plans to build at least 12 such schemes in Oman, requiring a budget of at least $55bn, MEED’s latest data shows. 

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Jennifer Aguinaldo

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