Posco Holdings, others to build hydrogen plant in Oman

Executives of six companies in a Posco Holdings-led consortium and officials from the Oman government sign a deal on Wednesday in Duqm, Oman. [POSCO HOLDINGS]

A Posco Holdings-led consortium won a deal to build the world's largest hydrogen plant in Duqm, Oman.

The Korean company said Thursday the consortium signed a deal with Hydrom, Oman's national green hydrogen development entity, to get an exclusive right for the hydrogen project in Duqm for 47 years. It is the largest overseas green hydrogen project won by a domestic company.

The investment size is reported to be about $6.7 billion, though the company did not confirm.

The Posco-led consortium includes Samsung Engineering, state-run Korea Southern Power, Korea East-West Power, France's Engie and Thailand's PTT Exploration and Production Public.

The four Korean companies hold 64 percent of the consortium, according to local reports, with Posco Holdings holding the majority with 28 percent.

The project includes a green hydrogen plant with an annual capacity of 220,000 tons. Ground will be broken at an around 340-square-kilometer (131-square-mile) site in Duqm in 2027 with the goal of completing construction in 2030.

Green hydrogen, which uses renewable energy such as solar and wind for its production, would be the ultimate eco-friendly option, but due to technological and geographical limits, making green hydrogen to meet demand is currently impossible, especially in Korea.

The produced hydrogen will be turned into ammonia to be transferred to Korea.

"Oman is rich in renewable energy and an important country for Posco as we strive to build a stable hydrogen supply chain," said Cho Ju-ik, head of Posco Holdings' hydrogen business division.

Posco Holdings aims to have an annual hydrogen production capacity of 7 million tons by 2050.

BY SARAH CHEA [chea.sarah@joongang.co.kr]