Omani renewable H2 project to start four years late

The targeted start date for the planned Hyport Duqm renewable hydrogen and ammonia project in Oman has been pushed back by at least four years and an offtake agreement with German utility Uniper is no longer in place.

The project, in which BP has agreed to acquire a 49pc stake, is now scheduled to start commercial operations in 2030-31, Belgian developer Deme said on 31 July. It was initially due to start operations in 2026, based on statements from Uniper in 2021 when the utility announced it had signed a cooperation agreement with the project developers. Under the preliminary deal, Uniper would have taken the full 330,000 t/yr of renewable ammonia output planned for the facility's first phase.

But this agreement could not be upheld after Uniper was nationalised in 2022, Deme told Argus today. The German government nationalised Uniper to stabilise the firm after it made major losses replacing missing Russian gas deliveries.

Deme did not comment on the reasons for the delay to the plant's start-up, but timelines have slipped for many other renewable hydrogen and ammonia projects because of difficulties securing firm offtakers and financing, persistent regulatory uncertainties and increased cost estimates.

Deme and Omani company OQ will each hold a 25.5pc stake in the Hyport Duqm project following BP's entry, which is expected to be finalised this quarter, the Belgian firm said. BP will become the project's operator.

The project is at the pre-front-end engineering design (pre-FEED) stage and is slated to entail around 500MW of electrolysis capacity, powered by 1.3GW of wind and solar capacity in its first phase, Deme said. The combined wind and solar power could be lifted to 2.7GW in a second phase, the firm said, without disclosing the electrolysis capacity for the expansion.

Output from the plant in the Duqm special economic zone is to be exported to Europe and northeast Asia from a nearby port, Deme said.

Deme is also considering projects in other countries including Egypt where it plans to set up a 320,000 t/yr renewable ammonia plant. Tunisia's government said earlier this week that it struck a preliminary deal with Deme on the development of a renewable hydrogen project, but the company said today that it is too early to disclose further details.

By Stefan Krumpelmann