Oman's first green hydrogen project FID in 2026-27

Zawya

03-03-2025

Oman - The first Final Investment Decision (FID) is anticipated during the 2026-27 timeframe by one of the consortiums awarded mandates to develop green hydrogen (GH2) projects in the Sultanate of Oman.
As many as eight consortiums have secured land blocks over the past two years to invest in large-scale green hydrogen schemes in the central and southern parts of Oman. They will collectively target the production of at least 1 million tonnes of green hydrogen by 2030 to support the country's transition to a low-carbon energy future.
Speaking at the 'Together We Progress' forum, hosted by the General Secretariat of the Council of Ministers over the weekend, Eng Salim bin Nasser al Aufi, Minister of Energy and Minerals, noted that the maiden FID – a critical milestone effectively enabling a project to progress from planning to execution – provides assurance that Oman's incipient green hydrogen journey is still on track.
The note of optimism comes against a flurry of global developments and policy reversals by countries, such as the United States, which is seeking to dial back its commitments to clean energy alternatives. On Wednesday, energy supermajor BP also announced a 'reset' in its much-heralded switch to renewables and clean energy.
Sharing his thoughts on other developments across the energy and minerals landscape, Al Aufi emphasised that Oman will continue to produce and export oil as long as 'production costs do not exceed the selling price in the global market'.
Furthermore, with private upstream players accounting for most of the investments in the oil and gas sector, the government is spared any significant burden in budgeting for hydrocarbon expenditures, he noted.
In the renewables sphere, developments have been overall positive, particularly in the wake of new solar projects coming on stream. In 2024, renewable electricity accounted for an average 9 per cent of total consumption during the year, reaching as much as 32 per cent on some days of the year. The national goal is to achieve an average 30 per cent from renewables annually by 2030, he said.
Wind power
Importantly, renewable energy capacity is set to be further bolstered this year with the planned award of contracts for four new wind-powered Independent Power Projects (IPPs) at various locations around the country.
Turning to the burgeoning minerals sector, the official noted that a new investment strategy now governs the exploitation of minerals in the country. While concession agreements cover the development of sites known for metallic mineral deposits, general sites are awarded for the mining of non-metallic minerals and building materials.
'We started with 12 concession areas awarded to Minerals Development Oman (MDO) in cooperation with Oman Investment Authority, as these concession areas require intensive exploration operations.
Previously, the areas were limited to small areas not exceeding 5 km2 and only one mineral was allowed to be extracted. Now, they have been given a longer period of 5-6 years for exploration and then 25 years for investment. The policy we have adopted has led to the export of copper concentrate for the first time in 10-15 years, which means that it is successful and attractive for investment and there is great demand from local and international companies,' said Al Aufi.
As for the presence of associated gold found with the copper deposits, the Minister noted that the quantities are so small that the cost of extracting and refining the precious metal would be unfeasible. Instead, the gold is left in place to help increase the value of copper concentrate exports.
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