Full Offtake Coverage Secured for Oman’s Green Iron Project: Key Boost for Investors and Sustainable Business Growth
MUSCAT: In a major step forward for Oman’s goal to localize heavy industry within its growing green hydrogen ecosystem, a leading international investor has secured full offtake agreements for its proposed green iron project at the Duqm Special Economic Zone.
Singapore-based Meranti Green Steel announced it has finalized binding offtake contracts covering the entire output of Module 1 of its planned 2.5 million tonnes per annum (tpa) hydrogen-ready Hot Briquetted Iron (HBI) facility. These agreements significantly enhance the project’s commercial viability and bankability as Meranti aims for a Final Investment Decision (FID) by mid-2026.
The contracts allocate 1.0 million tpa of HBI to German industrial materials trader Thyssenkrupp Materials Trading, 0.25 million tpa to INTERFER Edelstahl and INTERFER Austria, with the remaining volume designated for Swiss commodity and mining giant Glencore and Meranti’s upcoming steel plant in Rayong, Thailand. This supports the scale-up of green hot-rolled coil production.
Crucially, the offtake agreements also allow for additional volume commitments to the same partners for a potential second HBI module in Oman.
“These long-term agreements underpin the commercial foundation of Meranti’s green HBI project in Oman and advance progress toward FID,” the company stated. The contracts detail key commercial terms including pricing structures, product specifications, delivery schedules, and contract duration.
Meranti highlighted that the Duqm project distinguishes itself from conventional HBI plants by using a blend of natural gas and green hydrogen, producing transportable low-CO₂ iron feedstock optimized for Electric Arc Furnace (EAF) steelmaking in Europe and Asia. The project will leverage Oman’s competitive energy costs, access to renewable power, local raw material processing, and supportive regulatory framework to deliver cost-effective, low-carbon iron at scale.
Following a memorandum of understanding signed late last year, Meranti plans to source its green hydrogen from Amnah, a consortium awarded the concession to develop an integrated green hydrogen project in Duqm. The consortium—comprised of Copenhagen Infrastructure Partners (CIP), Blue Power Partners, and Al Khadra (Hind Bahwan Group)—intends to produce 200,000 tonnes of green hydrogen annually, powered by approximately 4.5 GW of renewable energy capacity.
KfW IPEX-Bank acts as Lead Arranger for the financing, with Jebsen & Jessen Industrial Solutions (JJIS) appointed as the Key Partner for the project’s export credit agency (ECA)-backed debt financing.
The Duqm HBI facility is slated for full commissioning by mid-2029, following the targeted FID in mid-2026.
Special Analysis by Omanet | Navigate Oman’s Market
The binding offtake agreements for Meranti Green Steel’s green hydrogen-powered iron project in Duqm signal a major leap toward establishing Oman as a global hub for sustainable heavy industry. This development presents lucrative opportunities for investors and entrepreneurs to capitalize on Oman’s abundant renewable energy resources and competitive costs while also mitigating risks linked to global carbon transition pressures. Smart stakeholders should prioritize partnerships and investments in green technologies and supportive infrastructure to harness the full potential of Oman’s evolving green industrial ecosystem.
