RWE and Hyphen Hydrogen Energy (Hyphen) have signed a memorandum of understanding which could see RWE offtake up to 300,000 tons of green ammonia per year from Namibia.
The agreement comes as the German multinational energy company plans to build a terminal for green ammonia in Brunsbuttel by 2026, which could serve as one port of destination for Namibian ammonia as it seeks to develop a globally diversified portfolio of long-term offtake agreements for green hydrogen and its derivatives.
Hyphen was appointed preferred bidder by the Namibian government to develop the country’s first green hydrogen project for export and by 2027 the project aims to annually produce 1 million tons of green ammonia – a hydrogen derivative that is particularly suitable for transport by ship.
“We are delighted to reach this agreement with RWE. This milestone underpins our ambitious targets to export green hydrogen globally from Namibia. By establishing strong connections with policymakers and offtakers across Europe, we are working with the Government of Namibia to develop the industry which will spearhead southern Africa’s role in achieving regional and global decarbonisation goals,” Hyphen Hydrogen Energy, CEO Marco Raffinetti said.
German renewable energy project developer Enertrag is a joint venture partner of Hyphen, which aims to begin construction in January 2025.
“Green molecules are the only way for many industries in Germany to achieve their climate targets. In the long term, Germany’s demand for them will have to be met mainly through imports. That’s why we’re looking forward to progressing the offtake discussions with Hyphen – to bring green ammonia from Namibia to Germany,” Ulf Kerstin, Chief Commercial Officer of RWE Supply & Trading said.
The Hyphen project will use around 5-6 GW of renewable generation and 3 GW of electrolyser capacity. The plan carries an estimated price tag for two phases of US$10 billion.
The European Investment Bank (EIB) signed a deal to finance early stages of the Hyphen plan during COP27.
Hyphen’s plans in Luderitz come as the town is undergoing dramatic growth, as it is also playing a role in plans for the two big offshore oil finds by TotalEnergies and Shell.
Ammonia is one of the most common basic materials in the chemical industry, with more than 180-million tons a year produced globally and processed into fertilisers or used in chemical processes, besides other applications.
