Investment Thesis
Green hydrogen represents Oman’s most ambitious industrial bet — leveraging world-class renewable resources (solar, some wind), available land (Duqm), deep-water port access (outside Hormuz), and existing energy project finance expertise to create a post-oil export industry.
For investors, the opportunity spans: project equity in Hyport Duqm and ACME Group projects, supply chain manufacturing (electrolysers, solar panels, balance-of-plant), and supporting infrastructure (port, ammonia storage, shipping).
Project Pipeline Summary
| Project | Developer | Capacity | Stage | Capital Required |
|---|---|---|---|---|
| Hyport Duqm | OQ/Shell/Uniper/Engie | 1.25 GW electrolyser | Development/FEED | $5-8bn |
| ACME Green H2 | ACME Group | 2.5 GW electrolyser | MoU/Development | $10-15bn |
| OQ Green Ammonia | OQ internal | 500 MW electrolyser | Development | $2-3bn |
| Additional projects | Various | TBD | MoU | TBD |
Commercial Viability Framework
Green hydrogen cost curve:
- 2023 cost: $4-7/kg (well above $1-2/kg grey hydrogen)
- 2030 projection (optimistic): $2-4/kg (approaching parity)
- 2035 projection (optimistic): $1.5-3/kg (at or near parity in best locations)
What makes Oman competitive:
- Solar LCOE: Potentially below $15/MWh at scale
- Land cost: Near zero in Duqm desert areas
- Desalinated water: Required for electrolysis — adds cost
- Port infrastructure: Already in place (Duqm)
Risk Analysis
Off-take risk (HIGH): No binding long-term purchase agreements at commercial scale. EU hydrogen import targets remain voluntary; buyer commitments are limited.
Technology risk (MEDIUM): Electrolysers are commercially proven at smaller scales; gigawatt-scale deployment has limited track record.
Financing risk (HIGH): Project finance for early green hydrogen projects requires innovative structures — limited lender familiarity with the asset class.
Competitive risk (MEDIUM): Morocco, Australia, Chile, and Saudi Arabia all target the same European/Asian markets.
Recommended Investment Approach
For most institutional investors, green hydrogen in Oman is a 2027-2035 story — when commercial conditions for FIDs are clearer. Early-stage participation (MoU stage equity, feasibility cost sharing) is appropriate only for investors with high risk appetite and long hold periods.