Oman's Green Hydrogen Ambitions: Leading the Middle East's Energy Transition
Key Ideas
- Oman is projected to exceed its 2030 goal of producing 1 million tonnes of green hydrogen annually, emphasizing its leading role in renewable energy generation in the Middle East.
- The country, along with UAE, Egypt, Iraq, and Morocco, will account for a significant share of the region's renewable energy expansion, driven by rising domestic electricity demand and ambitious energy transition targets.
- Major investments in new onshore wind capacity are expected in Oman and the MENA region to support renewable electricity generation, with around 4 GW of new onshore wind capacity anticipated by 2030.
- Oman is aiming for $40 billion in investments by 2030 to achieve an annual output of 1 million tonnes of zero-carbon hydrogen, with plans to ramp up production to 7.5 – 8 million tonnes per annum by 2050.
The International Energy Agency (IEA) has recognized Oman's significant progress in renewable energy, particularly in the production of green hydrogen. Oman is set to surpass its 2030 target of producing 1 million tonnes of green hydrogen annually, showcasing its commitment to driving the country's energy transition goals. The IEA's report, 'Renewables 2024', highlighted Oman among a few Middle Eastern countries poised to exceed their national hydrogen production goals.
The report underlines the region's growth in renewables, driven by rising domestic electricity demand and ambitious energy transition objectives. Oman is expected to play a crucial role alongside other countries like the UAE, Egypt, Iraq, and Morocco, collectively constituting a substantial portion of the region's renewable energy expansion.
In response to the increasing demand for electricity, Oman and the wider MENA region are looking to invest in new onshore wind capacity. The report anticipates the development of around 4 GW of new onshore wind capacity by 2030, with Oman, Saudi Arabia, and Egypt leading this endeavor.
Furthermore, Oman is actively positioning itself in the emerging green hydrogen sector. The country is targeting significant investments amounting to $40 billion by 2030 to achieve an annual output of 1 million tonnes of zero-carbon hydrogen. This investment is projected to escalate to $140 billion by 2050, aligning with the goal of ramping up green hydrogen production capacity to 7.5 – 8 million tonnes per annum.
The region's focus on hydrogen extends beyond electricity consumption, with hydrogen's use in industry and as feedstocks for hydrogen-based fuels encouraging renewable capacity growth. Noteworthy developments include global offtake contracts for ammonia in Egypt and Saudi Arabia, as well as land allocations in Oman for projects producing hydrogen for local industries and ammonia for export. Oman's trajectory towards becoming a key player in green hydrogen reflects a positive outlook for the country's energy transition and renewable energy sector.