Oman’s HyDuqm Hydrogen Project Eyes USD 8 Billion Investment

The HyDuqm green hydrogen project in Oman, led by a consortium of France’s Engie and South Korea’s Posco, is set to attract investments ranging between USD 7 billion and USD 8 billion to reach its full capacity.

As per reports, the large-scale renewable hydrogen initiative aims to contribute significantly to Oman’s ambitious hydrogen production targets, according to a report by the Oman Daily Observer. The consortium has secured a 340 sq km land block in Duqm, a strategic coastal area in central Oman.

This concession is part of eight land blocks awarded by Hydrogen Oman SPC (Hydrom), a subsidiary of Energy Development Oman (EDO), to international developers for green hydrogen production. The HyDuqm project will integrate up to 5 GW of wind and solar energy, supporting the production of 200,000 tonnes per annum (tpa) of renewable hydrogen. Oman’s Hydrogen Vision and Investment Needs

The development aligns with Oman’s broader green hydrogen strategy, which targets the production of 1 million tpa of renewable hydrogen by 2030. This ambitious goal requires an estimated USD 35 billion in total investment, highlighting the scale of funding and infrastructure needed for the country’s hydrogen sector. Hyerin Park, Vice-President for Hydrogen Business Development at Engie Asia, Middle East, and Africa, emphasised the importance of risk-sharing mechanisms to attract investors.

Speaking at a recent industry forum, she noted that “Investors are hesitant to fund projects where risks are overly concentrated, making public-private partnerships and policy-driven risk mitigation essential for bankability.”

To bridge the financing gap, Park stressed the need for government-backed incentives, including loan guarantees and subsidies, which are crucial for enabling large-scale hydrogen projects. The success of the HyDuqm project and similar developments in the region will depend on financial predictability, long-term off-take agreements, and clarity in hydrogen pricing structures.

South Korea’s Role in Green Hydrogen Off-Take HyDuqm is strategically positioned to support South Korea’s decarbonisation efforts, with plans to supply green ammonia as a cleaner alternative to coal in coal-fired power plants.

This long-term supply agreement is expected to create a stable demand base, reinforcing Oman’s role as a major exporter of renewable hydrogen. Oman’s Growing Role in the Hydrogen Economy With multiple large-scale hydrogen projects underway, Oman is positioning itself as a key player in the global hydrogen economy.

As international interest in green hydrogen and ammonia grows, projects like HyDuqm will be instrumental in meeting global decarbonisation goals while leveraging the Middle East’s renewable energy potential. The success of the HyDuqm project will depend on continued policy support, investment clarity, and global demand for hydrogen derivatives, shaping Oman’s future as a major clean energy exporter.