Strategic MoU for Green Hydrogen Project with CET
7 March 2023
Oracle Power PLC
("Oracle", the "Company" or the "Group")
Strategic MoU for Green Hydrogen Project with World's Largest Utility
Oracle Power PLC (AIM: ORCP), a developer of green hydrogen production through its joint venture Oracle Energy Limited ("Oracle Energy"), announces a strategic Memorandum of Understanding ("MoU") with China Electric Power and Technology Co., Ltd ("CET") to potentially develop, finance, construct, operate and maintain Oracle Energy's Green Hydrogen Project in Thatta, Sindh Province, Pakistan (the "Green Hydrogen Project").
CET is a wholly-owned subsidiary of State Grid Corporation of China, the largest power producer in the world by revenue in 2021. The MoU with CET, which has a mandate to finance, build, operate and maintain large renewable power generation projects within and outside of China, is focused on accelerating the development of Oracle Energy's Green Hydrogen Project, which includes the construction of a Hybrid Renewable Energy Production and Storage facility, combining 700MW of solar and 500MW of wind power, and battery storage.
The planned Green Hydrogen Production facility, when fully commissioned, would produce an estimated 150,000kg of hydrogen per day (55,000 tons per annum), and would be one of the largest such projects in Asia ("Green Hydrogen Project"). Feasibility work on the potential production of green hydrogen and green ammonia commenced in Q4 2022 with Thyssenkrupp, the German multinational engineering company, with initial results due in Q2 2023.
The MoU follows the successful acquisition by Oracle Energy of State land by way of a long lease for 30-years with the Government of Sindh, for a land package of 7,000 acres (approximately 28.3 km²).
Commenting on the MoU with CET, His Highness Sheikh Ahmed Dalmook Al Maktoum, who owns 70% of Oracle Energy, and is an active investor and developer of a number of power generation projects across the Middle East, Asia and Africa, stated:
"Oracle Energy's vision of developing one of the largest green hydrogen production facilities globally has taken significant strides towards being realised through partnering with State Grid of China, the largest power utility in the world. Having acquired the required land to build the project late in 2022, and having made significant progress in planning the construction of the Green Hydrogen Production facility with Thyssenkrupp, Oracle Energy is looking to fast-track the development of the Project by partnering with one of the world's leading companies, which has both financing capability, as well as significant experience of constructing large power projects globally. We look forward to working closely with CET and our other world class partners in maintaining this extraordinary momentum as we fulfil our stated strategy of being primarily focused on green energy development."
Commenting on the MoU with Oracle Energy, Mr Wang Bo, Vice General Manager of CET, said:
"We are very excited about the prospect of potentially financing, constructing and operating what will be Pakistan's largest renewable power facility, a crucial process to bringing the Green Hydrogen Project to the international markets for this crucial source of energy. The value of Oracle Energy's expertise and knowledge of the Pakistani energy market, combined with the highly respected Partners they already have, will be crucial in making this project not only a reality, but also one of significance from a global perspective."
For further information:
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O racle Power N aheed Memon (Chief Executive Officer) |
+44 (0) 203 580 4314 |
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Strand Hanson Limited (Nominated Adviser & Broker) Rory Murphy, Matthew Chandler, Rob Patrick
|
+44 (0) 20 7409 3494
|
Buchanan
Bobby Morse / Oonagh Reidy/ Abigail Gilchrist +44 (0) 203 7466 5000
Background information:
About CET Ltd
CET is a wholly-owned subsidiary of State Grid Corporation of China, with a branch in Pakistan for market development and expansion. It works as a general contracting platform for overseas power grid investment-construction-operation integration projects. Its core business is to undertake the construction of overseas power grid infrastructure and transnational cross-regional interconnection projects.
State Grid Corporation of China is a state-owned enterprise and the world's largest utility company, with a focus on the generation, transmission, and distribution of electric power. As of 2021, it had total assets of over $700 billion USD and annual revenue exceeding $350 billion USD.
About Oracle Power PLC
Oracle Power PLC is an international natural resource and power project developer quoted on London's AIM market. The Company is active in the energy industry in Pakistan and is working to establish a green hydrogen production facility through Oracle Energy Limited, a joint venture with His Highness Sheikh Ahmed Dalmook Al Maktoum.
Oracle Energy has been set up as the project development company and is funded on a 70:30 basis by Kaheel Energy (100% owned by His Highness Sheikh Ahmed Dalmook Al Maktoum) and Oracle Power respectively. The project development company provides a vehicle to support the accelerated development of the green hydrogen project to meet the growing international and domestic demand of green hydrogen and clean energy.
Green Hydrogen Project
Oracle Energy's flagship Green Hydrogen Project is targeting annual production of 55,000 tonnes of Green Hydrogen (equivalent to the production of 150,000 kg of hydrogen per day). The project plans the development of solar and wind power facilities with a combined output of 1.2 GW hybrid power from proposed capacity 700MW solar and 500MW wind plants, along with a battery storage park of up to 450 MW, to ensure the continuous production of hydrogen throughout the year.
Oracle Energy has made rapid progress in the development of the project to date. In October this year, it appointed ThyssenKrupp to lead the technical and commercial feasibility study for Green Hydrogen and Green Ammonia, due to be completed in H1 2023. The Company is in advanced discussion with multiple partners across the value chain and has signed MoU's and non-exclusive cooperation agreements including one with the green hydrogen certifier, TÜV SÜD.
Market for Green Hydrogen
The demand for green hydrogen could reach up to 660 million metric tons by 2050, representing 22% of the total energy demand globally, as the world transitions to a net-zero carbon economy. This demand is expected to increase exponentially across various sectors, including mobility, industry, and power.
Pakistan has set a target of meeting 30% of its energy requirements from renewable sources by 2030, and domestic hydrogen production could play a crucial role in achieving this goal. Oracle Energy has signed an MOU for offtake with EGA (Emirates Global Aluminium) for its Green Hydrogen output, and is also looking at potential supply to domestic utility companies and industries. The Company is also in dialogue with other potential off-takers in large Green Hydrogen markets, including China, Japan and Korea.
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