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$10-billion Namibian green hydrogen project receives major German boost

Namibia Mines and Energy Minister Tom Alweendo (left) and German Federal Minister for Economic Affairs and Climate Protection Dr Robert Habeck.

Namibia Mines and Energy Minister Tom Alweendo (left) and German Federal Minister for Economic Affairs and Climate Protection Dr Robert Habeck.

22nd March 2024

By: Martin Creamer

Creamer Media Editor

     

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JOHANNESBURG (miningweekly.com) – Namibia’s first gigawatt scale green hydrogen project – the $10-billion Hyphen development scheme – this week received a major boost from Germany.

The boost came in the form of the German government presenting a letter of intent to Enertrag, confirming the suitability of the project to be designated as a strategic foreign project.

Hyphen Hydrogen Energy is a Namibian-registered joint venture between Enertrag and Nicholas Holdings.

Strategic foreign project designation renders projects eligible to receive targeted support ­– a status reserved for high-priority global projects of strategic interest to Germany.

The project is seen as the first step of a large-scale green hydrogen industry in various regions in Namibia to support both economic growth in the Southern African country itself and to assist the world in achieving its decarbonisation goals.

At full scale, Hyphen is expected to produce 350 000 t of green hydrogen and two-million tonnes of green ammonia a year before the end of the decade.

In November 2021, it was awarded preferred-bidder status for the project, which is earmarked for development on 4 000 km2 of land within the Tsau //Khaeb National Park, near Lüderitz.

Hyphen and the Namibian government aim to begin construction in January 2025, with commissioning of the first phase by the end of 2026. Moreover, the Namibian government confirmed in June that it would take up a 24% equity stake in the project, which is targeting yearly production of one-million tonnes of green ammonia by 2027, and then the two-million tonnes by 2029, mostly for export.

This production, which will arise from 7 GW of renewable generation capacity and 3 GW of electrolyser capacity, will help to mitigate against climate change by eliminating five-million to six-million tonnes of carbon dioxide emissions a year.

Interestingly, the total investment over both phases is roughly the equivalent of Namibia’s current yearly gross domestic product.

"Germany is supporting the development of a green hydrogen economy in Namibia that is sustainable for the population through hydrogen and Power-to-X cooperation. The Hyphen project is committed to this in a similar way.

“We are therefore prepared to categorise it as a foreign project, under certain conditions, in the strategic interest of the Federal Republic of Germany and thus provide more support than usual through our foreign trade promotion instruments," German Federal Minister for Economic Affairs and Climate Protection Dr Robert Habeck stated in a media release to Engineering News & Mining Weekly.

Habeck and Enertrag CEO Dr Gunar Hering signed the letter of intent this week at the Federal Foreign Office in Berlin, as part of the Berlin Energy Transition Dialogue and present at the signing were Namibia Mines and Energy Minister Tom Alweendo and Namibia green hydrogen commissioner James Mnyupe, who is also economic advisor to the President of Namibia.

Alweendo described the project as “the first building block in realising Namibia’s ambitions to incubate a thriving synthetic fuels industry”.

“This letter of intent from the German government is a strong signal, which further emboldens our collective efforts to deepen and diversify our trade relations,” Alweendo added.

Enertrag international projects and technology board member Dr Tobias Bischof-Niemz pointed out that the project not only contributes to the energy transition, but is also an important testimony to international cooperation in the field of building new energy-trade partnerships on the basis of a shared understanding of democracy.

“We are very pleased with the trust that the German government has placed in us with this letter of support,” added Bischof-Niemz.

“The letter reflects the crucial role projects like ours will play in decarbonising heavy industry in Europe and beyond and the leading role that Germany is playing in driving forward global decarbonisation,” Hyphen Hydrogen Energy  CEO Marco Raffinetti commented.

Global renewable energy company Enertrag generates more than two terawatt-hours of electricity a year from its own plants in addition to developing, constructing, and operating integrated energy plants using wind and sun energy. Its 1 000-plus employees drive projects with a capacity of 15 GW in nine countries.

Independent international engineering and consulting firm ILF Consulting Engineers, which has entered into a partnership agreement with Hyphen, has developed green-hydrogen credentials on projects in Canada, Finland and Austria.

ILF will provide Hyphen with project management services, technical expertise, as well as procurement and contract advice as well as implementation expertise on the project’s socioeconomic development goals, including the creation of 15 000 construction jobs, 3 000 permanent jobs and 30% local procurement.

ILF’s hydrogen experience is expected to support the meeting of project timelines as well as Namibia’s development objectives.

ILF hydrogen director Dr Michel Kneller has described the Namibian development as a “lighthouse project” that is poised to contribute to the energy transition under way globally.

The green hydrogen economy and Southern African-hosted platinum group metals are seen as going hand-in-glove.

Edited by Creamer Media Reporter

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