Muscat – After the successful first round of auctions, which resulted in a total of five project awards worth more than $30bn, Hydrogen Oman (Hydrom) is now expecting to attract between $20bn-$30bn worth of investments through the second round of auctions for large-scale green hydrogen projects in the sultanate.

The first round of public auctions was launched late last year, and the agreements were signed in June 2023 with major international consortia and companies that will establish large-scale green hydrogen and ammonia projects in the sultanate.

In the second round of public auctions, which has already been launched, Hydrom plans to award three land blocks in the Dhofar region by the end of the first quarter of 2024.

“The expected investments in the green hydrogen sector in Oman until 2050 are estimated at $140bn. In the first round of public auctions, the presupposed cost of investments amounted to about $30bn. And in the second round, we look up for investments at a volume of $20bn-$30bn,” said Eng Abdulaziz al Shidhani, managing director of Hydrom, in an interview published in the latest edition of Duqm Economist magazine.

“The public auctions help achieve transparency on the one hand and attract serious investors who have the financial solvency to implement such projects on the other hand,” he added.

Hydrom focused on the Duqm region in the first round of public auctions and is now concentrating on Dhofar in the second round, through three opportunities offered to companies specialising in the green hydrogen sector.

Commenting on the success of the first round of public auctions, Shidhani said that the level of turnout was good, with clear competition between international companies. He added that as many as 60 companies had purchased the Request for Proposal (RFP) documents in the first round of auctions.

“The first round witnessed many consortiums between major international companies, reflecting the level of interest in this sector and the huge demand for investment in it. The preliminary data for the second round are also good,” Shidhani said.

He further said, “Our goal is not to sign with any company, but with companies that can implement the project and have financial solvency, technical expertise, and clarity in the idea of the project. We have closed the first round by signing agreements and not MoUs, which is a success for the efforts exerted and reflects the level of global interest in investing in Oman,” he added.

Production to start by 2030

From the five projects whose agreements were signed in June 2023, the projected production is about 750,000 metric tonnes of green hydrogen. Oman aims to produce more than one million tonnes of green hydrogen by 2030, through the exploitation of 30% of the allocated land. The sultanate expects production to gradually increase to reach about 8mn tonnes by 2050.

According to Shidhani, Hydrom’s goal is for the first green hydrogen project to be commissioned in 2030, or even before.

He said, “We expect companies to be able to reach this goal by then. The agreements were designed on the basis that the development of projects until they enter the production stage will take about seven years, including three and a half years to take field measurements of the quality of solar and wind energy. A similar period is counted for the preparation of designs and the kick-off of construction work. Accordingly, we expect construction to begin between 2026 and 2028, and production to begin in 2030.”

Oman has certain competitive advantages to develop a green hydrogen economy and holds an advanced position on the global green hydrogen map. The sultanate has competitive resources required for successful investment in this sector, including an abundance of land, high solar radiation, and wind power.

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