POSCO-led consortium with major industry players from various countries coming in for the project to be situated in Oman.
Here’s the article posted in KED Global.
According to them,
- A consortium led by POSCO Group secured a $6.7 billion contract to build the world’s largest green hydrogen plant in Duqm, Oman. The official signing was held on June 21 in Oman.
- POSCO, holding a 28% stake, will lead the project, with Samsung Engineering managing engineering, procurement, and construction. Engie SA holds 25%, and PTTEP holds 11%. The plant aims to produce carbon-neutral steel using hydrogen, with a capacity of 300,000 tons starting in 2026.
- Oman aims for net zero emissions by 2050 and to be a major hydrogen exporter by 2030.
This green hydrogen facility, set to have work started for in 2027 with its completion expected in 2030, will significantly contribute to Oman’s goal of becoming carbon neutral by 2050. Here are the key ways it will impact this goal:
- Renewable Energy Capacity: The plant will utilize 3.8 GW of renewable energy from wind and solar sources, which will help increase Oman’s overall renewable energy capacity and reduce reliance on fossil fuels.
- Green Hydrogen Production: The plant will produce 220,000 tons of green hydrogen annually, which can be converted into green ammonia for export and domestic use. This will help reduce carbon emissions in various sectors, such as industry, transportation, and power generation.
- Decarbonization Efforts: The project aligns with Oman’s national plan to achieve carbon neutrality by 2050, which includes accelerating the growth of clean energy and advancing green projects like green hydrogen production.
- Job Creation and Economic Development: The project is expected to create significant job opportunities and contribute to the local economy through the development of green hydrogen projects and associated industries.
- Enhanced Energy Security: The plant will enhance Oman’s energy security by diversifying its energy mix and reducing dependence on fossil fuels, which will help mitigate the impacts of climate change and ensure a sustainable future.
- International Cooperation: The project will also facilitate international cooperation and knowledge sharing in the green hydrogen sector, as Oman works with global partners to develop and implement clean energy solutions.
Oman faces several potential challenges in achieving its ambitious green hydrogen export targets by 2030:
Our specialty focus areas include
- Massive increase in renewable energy capacity: Meeting Oman’s 2030 hydrogen goal of 1 million tons will necessitate approximately 50 TWh of electricity, exceeding the present scale of the nation’s total electricity framework. Quickly expanding renewable energy capacity, notably solar PV and wind, will be essential yet arduous.
- Significant investment requirements: Scaling up green hydrogen production to 1 million tons by 2030 will require at least a cumulative investment of around $33 billion along with an additional $4 billion needed to increase renewables’ share of the electricity mix to 20%. Securing this level of investment in a timely manner will be a major challenge.
- Expansion of ammonia export infrastructure: Oman would need to increase its ammonia export capacity by 20-30 times by 2030, necessitating substantial investments in storage tanks and deep-water jetties. The rapid development of this infrastructure is crucial for Oman to emerge as a major hydrogen supplier.
- Domestic natural gas supply constraints: With oil and gas currently dominating over 95% of Oman’s electricity generation, reducing domestic natural gas consumption by 3 billion cubic meters annually to accommodate hydrogen production presents a formidable challenge.
- Technological and operational hurdles still present: Scaling up green hydrogen production via electrolysis powered by renewable energy remains an emerging technology. Addressing technical obstacles and refining operational processes are imperative for success.
- Fostering a global hydrogen export market: Oman must play a pivotal role in stimulating global demand for green hydrogen and hydrogen-based fuels like ammonia. Establishing robust international partnerships and supply chains will be pivotal for Oman’s success in this endeavor.
Despite these challenges, Oman is well-positioned to become a major green hydrogen exporter due to its abundant renewable energy resources, existing gas infrastructure, and strategic location. However, overcoming the investment, infrastructure, and technological barriers will require significant effort and coordination in the coming years.
Interestingly, we have some other posts related to this:
Oman’s Green Hydrogen Production: Market Research Report: Article highlights Oman’s potential to produce green hydrogen for $1.60/kg by 2030, requiring larger ammonia export facilities and $150bn investments for 2050 targets. Green Hydrogen Potential of Oman: A Key to Net Zero Emissions: IEA report highlights Oman’s vast potential for renewable hydrogen production, offering investment opportunities and CO2 emissions reduction.
