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On the way to becoming a green hydrogen partner

By Natascha Plankermann

March 11, 2024

Image titel: Hafenkais im Industriehafen Duqm im Oman

Sources: Natascha Plankermann

On the way to becoming a green hydrogen partner

Oman aims to score points with H2 infrastructure

Wind, sun and loads of expertise – these ingredients are to be used intensively in Oman to produce green hydrogen in the future. In contrast to other Gulf states, the Sultanate is making great strides in this regard. The green hydrogen is to be exported, but also used locally. First projects are underway and the infrastructure is being expanded. Experts see Oman as a promising partner for the clean energy transition in Germany.

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The excavators have rolled in; the sand has been swept out of improvised offices. The go-ahead has been given for a steelworks in the industrial port of Duqm in the Gulf state of Oman. Starting 2027, green hydrogen is to be produced here. “Vulcan Green Steel” is what the Indian owners from the family Jindal have named this business branch, for which a separate quay will be built to ship the products – directly opposite the other quays, from which containers and vehicles are transported across the Arabian Gulf. Customers for the green steel Jindal sees in Europe, for example in the German automotive industry.

The infrastructure in Duqm (see photo on p. 4) is growing rapidly, and the new steel plant is one of the building blocks of Oman’s future, which is to logically develop in the direction of green hydrogen. For the export, according to Dr. Firas Al-Abduwani of Oman’s energy ministry, ammonia and methanol are currently being considered as the main means of transport. Part of the new energy source, however, they want to use within the country. Other parts and products such as green steel are to be shipped via the industrial ports in Sohar, Duqm or Salalah in southern Oman, for example to Germany.

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Future plans with the best prerequisites

Experts from the International Energy Agency (IEA) and the German foundation Stiftung Wissenschaft und Politik (SWP, see info box) see ideal conditions for the future plans of Oman: more than 2,000 kilometers of coastline, along which the wind blows around the clock, and eight to more than ten hours of sunshine per day.

Furthermore, the country has leading expertise in hydrogen production, well-developed ports with strategic positions and plants for desalinating seawater. These usually work with reverse osmosis to filter out dissolved substances. The associated costs for hydrogen production Dr. Dawud Ansari from the research group Globale Fragen (global questions) of SWP estimates as very little – he talks of about one percent of the cost per kilogram hydrogen.

The state institution Hydrom, however, does not want to commit itself to this yet. Hydrom has been developing a master plan for the green hydrogen sector in Oman since autumn 2022 and is creating the conditions for production. Also currently being discussed is the use of treated wastewater from the oil and gas industry.

Oman is pressing ahead with the development of green hydrogen as a future energy supplier so that it will be economically no longer predominantly dependent on dwindling oil and gas reserves. Also to be supported will be the country’s climate neutrality plans that the ruling sultan Haitham Bin Tarik set out in Oman Vision 2040. This could make the Sultanate a promising candidate for supporting the energy transition in Germany.

According to the Wuppertal Institut, a think tank for sustainability research, only up to one sixth of the expected H2 demand in Germany can be covered by domestic production in 2030. The majority will have to be imported – partners for this are being sought worldwide.

Pioneering work begins with five local consortia

Against this background, Oman is bringing itself in position: The strategy of Hydrom would allow for Oman to produce one million metric tons of green hydrogen annually starting 2030, and by 2050, it is to be around 8.5 million tonnes. By then, Oman wants to have fully reduced its CO2 emissions and additionally to have created around 70,000 new job positions. Estimated investment cost according to Hydrom and the energy ministry: around 150 billion US dollars.

To achieve the ambitious goals, pioneering work is now required: For example, it is important to attract companies that develop the corresponding technology. Electrolyzers for industrial processes that use sun, wind and water must be built. Furthermore, plans for sustainable, effective and economical business models are still needed.

The first five international consortia have just been awarded contracts by Hydrom to produce green hydrogen and ammonia for export and domestic consumption on a total area of around 1,500 square kilometers (580 sq mi) in the region Duqm. A further 1,800 square kilometers of land are currently being made available in southern Oman, in Salalah, via a second public tender. This auction is running until April 2024.

Potential for German companies

German companies are already involved in development in Oman. But Oman’s high-flying plans offer much more potential. This is the view of, for example, Dr. Abdullah Al-Abri, Omani consultant at the IEA – and hopes that the cooperation that was agreed in a Joint Declaration of Interest with Germany in summer 2022 will gain momentum.

“So far, the potential customers for green hydrogen from Oman are still mainly located in Japan or Korea,” opined the expert. Dr. Ruth Prelicz, expert for hydrogen and renewable energy systems at the chamber of commerce AHK Oman, however, stressed: “In summer 2023, the German energy supply company SEFE (Securing Energy for Europe GmbH) concluded an offtake agreement for liquefied natural gas (LNG) from Oman. This contract for LNG deliveries serves to build trusting business relationships and is also seen as a precursor to later deliveries of green hydrogen.”


Alok Bisen, who works for the Indian steel company Jindal, showing the construction area for green steel production in Duqm

Ruth Prelicz is observing the development on site: She is supporting the hydrogen foreign office Wasserstoffdiplomatie des Auswärtigen Amtes (H2Diplo) and the energy dialogue of the German economy and climate protection ministry (BMWK) in Oman. The expert sees a number of opportunities for German companies to benefit from cooperation with Oman in the field of green hydrogen: “It’s not just about the acceptance of the end product. Oman is also interesting as a market for German high-tech technology. Siemens Energy and ThyssenKrupp are established as potential suppliers of electrolyzers in Oman. And in the area of hydrogen transport, the Bavarian hydrogen experts of Hydrogenious as well as MAN Energy Solutions have presented their technology in the field of liquid organic hydrogen carriers (LOHC) and methanol.”

Also companies specializing in hydrogen compressors, pipelines or measuring devices, in her view, will be in demand in the country in the future. Further opportunities for German companies could be in the areas of green hydrogen certification as well as training and education. According to the expert, TÜV Süd, for example, is already active in this in Oman.

Oman’s stable position in the region

That cooperation with the Sultanate is not only worthwhile from a trade policy perspective stressed Dr. Dawud Ansari of SWP. For him, closer (energy) relations with the Sultanate as Germany’s central partner in the region bring further advantages: “Germany has an interest in strengthening relations with and the economy in Oman, as the Sultanate constitutes a cornerstone of regional peace processes. Oman itself is very stable and safe – both in terms of trade relations and domestic policy and in relation to its neighbors. The Yemen conflict and other regional disputes will, thanks to Oman’s diplomatic fortitude and border security, not spread to the country.”

The research for this text was supported by Park Inn by Radisson Hotel & Residence Duqm as accommodation. https://www.radissonhotels.com

Further reading:

Current information from the state institution Hydrom, which is developing a master plan for the green hydrogen sector in Oman: hydrom.om

Vision 2024 of the Sultanate of Oman: oman2024.om

More information about the port in Duqm, where Oman’s first green hydrogen projects will appear: https://portofduqm.om

Stiftung Wissenschaft und Politik, Publikationen, Dawud Ansari: Wasserstoff aus Oman für Deutschland und die EU – nicht nur aus energiepolitischer Perspektive sinnvoll. SWP-Aktuell 2023/ 9.3.2023 https://www.swp-berlin.org/publikation/wasserstoff-aus-oman-fuer-deutschland-und-die-eu

Die Geopolitik des Wasserstoffs. Technologien, Akteure und Szenarien bis 2040. Studie von Jacopo Maria Pepe, Dawud Ansari und Rosa Melissa Gehrung, Stiftung Wissenschaft und Politik, 16.11.2023. https://www.swp-berlin.org/publikation/die-geopolitik-des-wasserstoffs

The International Energy Agency (IEA), a cooperation platform in the field of research, development, market introduction and application of energy technologies, has commented on Oman’s great potential for the production of green hydrogen: https://www.iea.org, subitems News / Oman

The chamber of foreign trade Außenhandelskammer (AHK) Oman maintains a representative office of German industry in Oman’s capital Muscat. There, Sousann El-Faksch and Dr. Ruth Prelicz (ruth.prelicz@ahkoman.com) give information on the topic of green hydrogen: https://www.ahk.de/oman

Author: Natascha Plankermann

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