Oman green hydrogen auction: two Duqm projects awarded

Two consortia have won Duqm sites in the third Oman green hydrogen auction, with combined plans for about 121,000 tonnes of green hydrogen a year by 2032, national orchestrator Hydrom said at COP31.

The awards, announced on 12 November during the COP31 climate summit in Antalya, Türkiye, add green ammonium nitrate to Oman’s hydrogen portfolio alongside further green ammonia capacity for export. Hydrom also opened a fourth round built around data centres as anchor power customers.

Two Duqm projects, two products

The first agreement is with Oman’s Petrogas E&P and Italy’s Bio3Energy Srl. The project targets 625,000 tonnes a year of green ammonium nitrate by 2032, a product used in the fertiliser and mining sectors, according to the Hydrom statement.

It will use about 50,000 tonnes of green hydrogen a year, produced from 1.16 GW of renewable capacity on a 100 square kilometre site. The agreement includes a proposed reservation of a further 100 square kilometres for future expansion.

The second agreement brings together Indonesia’s PLN Indonesia Power Renewables, Oman’s Alawi Enterprises and Singapore’s HBA Offshore International PTE. Their integrated hydrogen and ammonia plant, also on 100 square kilometres, targets 400,000 tonnes of green ammonia a year for export by 2032, using about 1.45 GW of solar generation and 1 GW of electrolysis capacity.

Hydrom has not disclosed the investment value of either project. Abdulaziz Said Al Shidhani, Managing Director of Hydrom, said the priority is now to support the two consortia towards investment decisions, Utilities Middle East reported.

New incentives after a difficult period for hydrogen

Round 3 of the Oman green hydrogen auction was designed to be more flexible than the two earlier rounds. Developers could define their own footprints within a land block of up to 300 square kilometres, with a minimum of 100 square kilometres, and were given nine months to prepare bids, Hydrom said.

The round also introduced fiscal incentives: a 90% reduction in land lease fees during development, possible further relief during the front-end engineering design phase, lower base royalties in the first years of production and corporate tax exemptions of up to ten years. The measures are meant to improve early-stage project economics and help developers reach final investment decisions.

The changes follow a testing period for hydrogen projects worldwide. In December 2025 Hydrom confirmed that bp had exited its Duqm project, Utilities Middle East reported. Construction is under way on the first phase of ACME Group’s green hydrogen and ammonia project in Duqm, with Oman’s first commercial-scale green hydrogen production expected in 2027, according to the same report.

How the Oman green hydrogen auction will work in Round 4

The fourth round, named the Green-Powered Data Centre Hydrogen Auction, is located in Dhofar. It links renewable energy and green hydrogen production to the electricity needs of data centres, which will act as anchor offtakers.

Registration for expressions of interest is open until February 2027 through Hydrom’s official auction platform.

Hydrom is a subsidiary of state-owned Energy Development Oman. Across its first two auction rounds it licensed eight projects in Duqm and in Dhofar near Salalah.

For investors across the Gulf, the latest awards show a shift towards downstream products such as ammonium nitrate and towards domestic demand from data centres, as the global hydrogen industry places greater emphasis on project economics.

The data-centre focus also builds on Oman’s push to attract capital to Dhofar, including the $1.4bn of investment agreements signed at the Muscat forum last month, and mirrors the scale of renewable procurement seen in neighbouring markets such as Saudi Arabia’s 3,200 MW Round 8 tender.

The next step for the two Round 3 consortia is detailed engineering and financing ahead of final investment decisions. Round 4 bidders have until February 2027 to register, with full details in Hydrom’s official announcement.