A sharp increase in the number of attendees at the latest Green Hydrogen Summit Oman, held in December, highlighted the sultanate’s potential to become a major player in the sector.

Prudent policymaking combined with several natural advantages—climate, low population density, political stability and position on key world trade routes—have attracted provisional commitments by heavyweight foreign firms to produce more than 90% of the government’s target of 1mt/yr by the end of the decade.

The focus now is on readying a wider ecosystem to accelerate the execution of projects, with the development of infrastructure and supply chains taking priority.

The IEA estimates Oman can become the world’s sixth-largest green hydrogen exporter by 2030.

An agreement signed during the summit allocating land for a sixth upstream production project took total output commitments from licensed developers to 925,000t/yr.

1mt/yr – 2030 production target

The ‘block’ was the first to be apportioned in the southern Dhofar region, one of three areas intended to become production hubs. It went to the SalalahH2 consortium, led by Japan’s Marubeni, for a scheme first outlined in 2021 and aimed at producing 1mt/yr of green ammonia.

The scheme will enjoy a unique cost advantage over others intending to convert the green hydrogen into ammonia by dint of having use of shareholder state firm OQ’s existing 1,000t/d ammonia plant in Salalah. South Korea’s Samsung C&T simultaneously announced its entry into the consortium alongside original minority foreign partner Dubai-based Dutco. Construction is envisaged as starting in 2027, with startup three years later.

Japan and South Korea are central to all the Mideast Gulf states’ hydrogen export ambitions owing to the fuel’s importance in the resource-poor Asian countries’ relatively advanced decarbonisation strategies, combined with the depth of existing energy ties and geographical proximity. In June, a South Korean-dominated team won the rights to develop a green ammonia plant at Duqm, on Oman’s east-central coast, during Muscat’s first auction of land for such purposes. Bids in the auctions take the form of firmly delineated projects producing at least 150,000t/yr of hydrogen.

Second round

A second licensing round, intended to allocate up to three blocks in Dhofar, closes on 28 January, with awards planned by end-April. Speaking at the summit, officials from Hydrom, the government firm tasked with managing the industry’s development, claimed to have received interest exceeding that for the first—with 40 firms accorded initial clearance to participate.

The presence of oil majors BP and Shell among the successful bidders for the Duqm plots is likely to have instilled confidence. However, neither these firms nor any others have reached FID.

In the meantime, the government is working to develop the national and local infrastructure to speed schemes to the commissioning stage when that time comes. During the summit, Hydrom announced the creation of a new subsidiary, Infraco, to oversee the installation of shared water, electricity and hydrogen transportation facilities around Duqm and in Dhofar by 2029 for common use by project developers. These would be managed respectively by Nama Water Services, Oman Electricity Transmission Company and OQ Gas Networks (OQGN)—all state-owned.

OQGN signed separate memorandums of understanding (MOUs) with Hydrom and Belgium’s Fluxys earlier in the year to collaborate on development of the sultanate’s wider hydrogen transportation system, which is ultimately expected to include a north-south pipeline extending to the far northern industrial city of Sohar, where the fuel’s potential for use in abatement is highest.

The summit also saw the signature by Hydrom of an MOU with government logistics provider ASYAD Group to support development of green hydrogen projects by “orchestrating a robust domestic supply chain [and] fostering a conducive ecosystem”.

ASYAD, which holds the state’s interests in the sultanate’s three deepwater ports at Duqm, Salalah and Sohar, had been working independently to this end—publishing a report in January titled Potential of the Hydrogen Transition for Ports in the Sultanate of Oman, which was commissioned by Munich-based Dii Desert Energy and local research body the Oman Hydrogen Centre. That report’s findings included the superior viability of installing a dedicated hydrogen transportation network over blending hydrogen with natural gas in existing pipelines or repurposing the latter entirely.

The desire to nurture a broader hydrogen ecosystem—thereby multiplying the industry’s economic and job-creation impact—was evident in another Hydrom MOU sealed at the summit with German company Siemens to work towards building and operating a local electrolyser-manufacturing plant.

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Author: Clare Dunkley