A major green hydrogen project planned for development in the south of the Sultanate of Oman is anticipated to draw in foreign direct investments to the tune of around $6.5 billion, a key project official has revealed.
Eng Siddiqa al Lawati, Project Lead, said the proposed H2Oman venture – one of half a dozen ‘Legacy Initiatives’ unveiled prior to the formal launch of Oman’s National Hydrogen Strategy in October – will unleash significant environmental, financial and social benefits for the country.
Speaking at an energy forum held in Muscat recently, Siddiqa – who is part of the Alternative Energy Unit at Omani energy group OQ – added that the project will also include a sizable In-Country Value (ICV) component.
H2Oman is backed by a consortium comprising leading Saudi-based global energy and water services group ACWA Power, OQ Group of the Sultanate of Oman, and US headquartered industrial gases giant Air Products.
Envisioned for development in Dhofar Governorate, the project will generate around 1.1 million tonnes of green ammonia per annum based on 3 GW of solar and wind-based renewables capacity, and 2 GW of electrolyzer capacity. Battery storage will be an integral part of the project as well.
Significantly, H2Oman will also benefit from a similar-sized green hydrogen scheme planned by two of the key consortium partners at NEOM, a futuristic city under construction in the northwestern part of Saudi Arabia.
“What’s unique about this (H2Oman) project is that the partners are developing a project of the same scale in NEOM in Saudi Arabia. And the benefit we get out of that is that the lessons learnt are transferred directly to H2Oman project, in the sense of project planning, execution, as well as the technical and design work,” Siddiqa said.
Additionally, H2Oman is projected to pull in around $6.5 billion in foreign direct investments over the life of the project, the Project Lead noted, adding that the ICV component will be attractive as well.
“As it stands today, 29 per cent of the total project capex would be actually procured and done locally, and 53 per cent of the opex over the project lifetime of 30 years will also be spent locally. This is per the current situation of the market. However, given the appetite we saw in the market and with a minimum investment, we would be able to scale this up to have another 9 per cent of capex to be spent locally in Oman as well,” she stated.
Furthermore, as many as 15,000 jobs will be created during the construction phase, in addition to around 330 jobs when H2Oman is operational, the Project Lead added.