The Namibian government has confirmed that it will take up a 24% equity stake in a $10-billion green hydrogen project being developed in the Tsau //Khaeb National Park, near Lüderitz.

Finance Minister Iipumbu Shiimi said the decision to take up the position in the project, the investment value of which is almost equivalent to the country’s gross domestic product, followed on from the finalisation of agreements for the establishment of SDG Namibia One.

SDG Namibia One is a blended financing infrastructure fund that will raise money from local and international investors to develop Namibian green hydrogen projects.

The fund’s establishment will also see Namibia’s Environment Investment Fund partnering with two Dutch organisations – Climate Fund Managers and Invest International – in the creation of NH2 Fund Managers as the fund manager of SDG Namibia One.

An initial €40-million is being provided as grant funding by Invest International, while European Investment Bank concluded a letter of intent with Namibia at COP27 for the raising of €500-million, a portion of which will be designated for investment through SDG Namibia One.

Green hydrogen also featured strongly during the joint visit to Namibia on June 19 by Netherlands Prime Minister Mark Rutte and Danish Prime Minister Mette Frederiksen.

Rutte and Frederiksen subsequently travelled to South Africa, where President Cyril Ramaphosa announced that a $1-billion SA-H2 Fund, which is being seeded by an initial $250-million from Invest International of the Netherlands, was being established to mobilise green hydrogen investments.

Meanwhile,  Hyphen Hydrogen Energy, which is developing the Namibian projects, also announced that a memorandum of understanding had been signed with Namibia, NamPort, NamPower, the Port of Rotterdam, Gasunie and Invest International committing the partners to work together on designing the infrastructure required to deliver on Namibia’s green hydrogen production ambitions.

The MoU builds on the existing relationship between NamPort, Port of Rotterdam and Hyphen in the development of the new master plan for the Port of Lüderitz, while NamPower and Hyphen are also investigating the possibility of supplying excess electricity generated by the project to NamPower.

Namibia also announced the establishment of an Implementation Authority Office to facilitate and accelerate the development and implementation of Namibia’s synthetic fuels industry with funding for the office being provided by grants from Invest International and the European Union.

These developments follow the signing in late May of a feasibility and implementation agreement (FIA) between Namibia and Hyphen for the project, which aims to produce two-million tonnes of green ammonia yearly by 2029.

Hyphen, which is a Namibian-registered joint venture between Nicholas Holdings Limited and Enertrag, was awarded preferred-bidder status in November 2021 and the FIA comprises five sequential phases, including a two-year feasibility period.