The Namibian government has taken decisive action by mobilising an impressive sum of over €40 million (N$825.4 million) for the green hydrogen project, the Office of the Presidency has said.
This substantial funding aims to strategically de-risk the government’s equity investment in the ambitious green hydrogen project.
With a vision to establish a robust green fuels industry on a significant scale, Namibia sets its sights on a production target of 10-12 million metric tons per annum (Mtpa) of hydrogen equivalent by the year 2050.
“GRN has mobilised more than €40 million to date to de-risk its equity investment in the project, associated infrastructure, and future green hydrogen projects, additional support is expected to be announced post the execution of the Feasibility and Implementation Agreement (FIA),”the Presidency said.
At the Africa Energy Indaba 2023 in Cape Town, South Africa,last month, Namibia said it expects to sign the implementation agreement for the envisioned U$10 billion green hydrogen project in the second quarter of 2023 and commence feasibility studies.
This is becoming a reality on 26 May 2023 as signing takes place at the State House.
“The Cabinet has approved the entry into an agreement with Hyphen Hydrogen Energy to govern the development, implementation, and operation of sub-Saharan Africa’s largest, and it’s only fully vertically integrated, green hydrogen project,”the Presidency said.
The Harambee Prosperity Plan II, according to President Hage Geingob, highlighted that the Namibian Government would study the viability of incubating a synthetic fuels sector in Namibia as a crucial transformative agent of our economy.
“On Friday the 26 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,” Geingobsaid.
Meanwhile, Obeth Kandjoze the chairman of the Namibian Green Hydrogen Council and Director General of the National Planning Commission stated: “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.”
Kandjoze went on to say that this initiative is vital because it has the ability to create jobs in Namibia, alleviate regional energy insecurity, and aid in the fight against climate change by decarbonizing hard-to-abate sectors around the world.
Marco Raffinetti, CEO of Hyphen Hydrogen Energy, expressed his joy at the completion of the FIA and looks forward to delivering on the next stage of development of this groundbreaking project.
In addition, Dr Gunar Hering, CEO of ENERTRAG said his company is proud and 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,” stated Hering.
The project is expected to generate up to 15,000 new employment during the construction phase and 3,000 permanent jobs during its operation, with the goal of filling 90% of these jobs with Namibians and 20% with youngsters.
During the construction and operational phases, the project aims for 30% local sourcing of goods, services and materials. The project will provide significant cash for the Namibian government through land rentals, royalties on all project earnings, and taxes.
At the same time, the government has the option to become a co-investor in the project, with the right to take up to a 24% equity stake at cost.
Namibia has mobilised more than €540 million (N$11.167 billion) in donor and concessional funding from Invest International and the European Investment Bank through its partnership with the European Union and the Global Gateway Initiative to finance the development of the green hydrogen industry and to fund its equity participation in the project, with additional support expected to be announced following the execution of the FIA.