The Cabinet has approved the government to enter into an agreement with Hyphen Hydrogen Energy, a company awarded the bid to develop green hydrogen projects in Namibia.
The approval will now allow for the signing of a Feasibility and Implementation Agreement (FIA), planned to be signed on 26 May 2023, to govern the process under which Namibia’s first green hydrogen project will be realised.
“With limited existing international precedent to draw upon, GRN and the inter-ministerial Green Hydrogen Council assembled a negotiations team which was supported by international advisors, to develop the FIA. GRN and Hyphen believe that the FIA will set a new global benchmark, creating a template for the sustainable and equitable development of other green hydrogen projects,” a Hyphen and the government joint announcement said on Wednesday
Under the FIA, Hyphen is responsible for the technical, financial, environmental, social and commercial delivery of the project, while the Namibian government is responsible for providing the land on which the project will be established and developing and implementing the required legal, fiscal and regulatory environment necessary for the establishment and sustainable operation of Namibia’s green hydrogen industry.
“The Harambee Prosperity Plan II noted that the Namibian Government would investigate the feasibility of incubating a synthetic fuels industry in Namibia, as a key transforming agent of our economy. On Friday the 26th of May 2023, we earnestly embark on that journey, as we kick start a process that has the potential to transform the lives of many in our country, the region and indeed the world,” President Hage Geingob said.
Ursula Von Der Leyen, the President of the European Commission, said “Namibia has the potential to become one of the main renewable energy hubs on the African continent and even world-wide. Today’s agreement is a major step for the production of green hydrogen in the country. I am proud that Global Gateway allows the EU and Namibia to invest in a shared future fighting climate change together, making Namibia energy-independent and creating jobs and prosperity”.
Hyphen Hydrogen Energy CEO Marco Raffinetti said the company was delighted to have concluded the FIA and look forward to delivering on the next phase of development of this ground-breaking project.
“On behalf of Hyphen, I would like to thank the Government for its unwavering support and relentless commitment to unlocking Namibia’s green hydrogen potential. We are confident in our ability to work hand in hand with the people of Namibian to drive lasting change through economic development and job creation, whilst paving the way for a greener and brighter future,” he said.
CEO of ENERTRAG Dr Gunar Hering said the company was honoured to be a partner of the Namibian government in creating a competitive green-hydrogen industry.
“Our aim and commitment are to grow Hyphen into a world-class Namibian green-hydrogen company,” he said.
Whereas, Chairman of the Namibian Green Hydrogen Council and Director General of the National Planning Commission Obeth Kandjoze said: “We are honoured by the trust and confidence exhibited by Hyphen and the global community, for choosing to build such a catalytic project in Namibia. This project is strategic in its potential to create employment in Namibia, reduce regional energy insecurity and help combat climate change by decarbonising hard to abate sectors globally. The Government of the Republic of Namibia is resolute in its unwavering commitment to realise the potential of this transformative strategic bet!”
The Namibian government has an opportunity to be a co-investor in the project with the right to take up to a 24% equity interest at cost.
Hyphen was awarded preferred bidder status on 4,000 square kilometres of land within the Tsau //Khaeb National Park for the development of Namibia’s first fully vertically integrated GW scale green hydrogen project.
In the first phase of the project, N$70 billion (€3.5 billion) will be used on the green hydrogen pipeline, N$24 billion (€1.2 billion) on the water pipeline as well as N$100 billion (€5 billion) on the transmission lines.
At full capacity, the Hyphen project is expected to produce about 300,000 tonnes of green hydrogen per year for regional and global markets from 5GW of renewable generation capacity and 3GW electrolyser.
The project once fully developed will employ an estimated 3,000 people, with 15,000 construction jobs supported over the four-year construction period. Over 90% of these jobs are expected to be filled by local Namibians.
Hyphen Hydrogen Energy has signed two memoranda of understanding with a major chemical company and South Korean hydrogen producer Approtium for a total annual offtake of 750,000 million tonnes of green ammonia.
The agreements follow Hyphen’s recently signed Memorandum of Understanding with RWE Supply and Trading (RWEST), the German multinational utility company for supply of up to 300,000 tonnes annually of green ammonia from 2027. Hyphen has now concluded agreements for volumes exceeding one million tonnes of ammonia per annum.
