Oman’s $3.4bn green steel plant to be ready by 2026

Jindal Steel Group

• Runs on renewables and green hydrogen
• 12m tonnes per annum CO2 savings
• ‘Pioneering step’ for industry

A green steel plant project planned for Oman is scheduled for completion in 2026 and aims to position the sultanate as a production trailblazer.

Vulcan Green Steel, a project by India-based Jindal Steel Group in the special economic ­­zone at Duqm (Sezad) will establish a six million metric tonnes per annum green hydrogen-ready steel plant. 

Groundwork and site preparation began last month and an engineering consultant will be hired in September for phase one of the project ahead of the start of construction a month later.

• Oman plans to start work on more green projects this year
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• Oman ready to be global hydrogen player

The company plans to appoint a consultant for the second phase in December.

It is estimated the plant will achieve CO2 savings of 12 million tonnes per year and will be powered entirely by renewable energy and green hydrogen.

Ibtisam Ahmed Al Faroojia, the undersecretary of the ministry of commerce, industry and investment promotion, said the project will see investments exceeding OMR1.3 billion ($3.4 billion), describing it as a “pioneering step” in Oman’s journey to become a centre for green industries. 

“The project will mark the beginning of large-scale industrial projects that will solidify Oman’s presence on the world map as an attractive destination for foreign direct investments in this promising sector,” she said.

Khalid Jashmi, senior advisor at Jindal Steel Group, added that the venture sets a new standard for green energy to green steel projects.

Unlike conventional methods of transporting green hydrogen in the form of green ammonia, it will process green hydrogen within Oman to make green steel. 

Solar and hydrogen

Oman is dedicating an area the size of Slovakia to solar power projects to produce green hydrogen.

Production targets are 1 million tonnes by 2030, 3.75 million tonnes by 2040 and 8.5 million tonnes by 2050, which would make the sultanate the world’s sixth largest exporter of hydrogen and the largest in the Middle East by 2030.

Oman will need a cumulative investment of around $33 billion if it wants to scale up production of renewable hydrogen to 1 million tonnes by 2030, according to analysis by the International Energy Agency.

Nama Power & Water Procurement Co, the state-owned monopoly procurer for power and water, said in its latest 2023-2029 report that the country will likely issue requests for qualifications for new wind and solar-based independent power projects and a waste-to-energy project in the current quarter. 

In June, Salim bin Nasser Al Aufi, minister of energy and minerals, signed $20 billion of contracts with partners including BP, Shell and the newly formed Hydrogen Oman to produce 500,000 tonnes of green hydrogen each year. 

Last month, Indian renewable energy company Acme Group said it had secured a loan of $490 million to finance a green hydrogen and ammonia project at Sezad.

It is expected to produce 100,000 metric tonnes of green ammonia annually in its starting phase and will then be expanded to 1.2 million tonnes per annum.

The global hydrogen production market was valued at $130 billion last year, according to the World Bank, and is estimated to grow by up to 9.2 percent per year until 2030.