Oracle Power PLC (AIM: ORCP), a developer of green hydrogen production through its joint venture Oracle Energy Limited ("Oracle Energy"), is pleased to announce the acquisition by Oracle Energy of State land by way of a long lease for 30-years ("the Lease Acquisition") with the Government of Sindh, for a land package of 7,000 acres (approximately 28.3 km²) ("the land package") located in the Thatta district, Sindh, south-east Pakistan, where its flagship Green Hydrogen Project (or the "Project") will be located. The Company's partner, His Highness Sheikh Ahmed Dalmook Al Maktoum, who owns 70% of Oracle Energy through Kaheel Energy FZE, is an active investor and developer of a number of power generation projects across the Middle East, Asia and Africa.
Oracle Energy's Green Hydrogen Project would be Pakistan's first producer of green hydrogen, with an initial capacity to produce 55,000 tonnes annually, and be one of the largest hydrogen projects in the Middle East and Asia.
Green hydrogen is differentiated from other types of hydrogen as it is powered exclusively by renewable energy sources and is produced through water electrolysis. Hydrogen and its by-product ammonia are key constituents for critical sectors including manufacturing, transportation, power generation and agriculture.
Oracle Energy has paid an initial consideration of US$1,830,000 (split 70/30 between His Highness Sheikh Ahmed Dalmook Al Maktoum and Oracle Power respectively) for the first 10 years for the Lease Acquisition, which is for a minimum of 30 years. Further payments are made for every further ten year period, with the next payments due in 2033 and 2043, and these would double per every 10 years.
The Project site in Sindh is within a highly attractive, strategic region in southern Pakistan, located within the Gharo-Jhimpir wind corridor, where over 1 GW of renewable power has been constructed and commissioned, of which 350 MW commissioned power lies within a 10 km radius of the Project.
Beyond access to Pakistan's national grid, the Project has immediate proximity to existing infrastructure, including access to water in the form of Karachi's largest freshwater reservoir, and established rail and road infrastructure, which connect to Pakistan's two largest ports - Karachi Port and Port Qasim.
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). Oracle Energy intends to supply its production to local industries supporting manufacturing, fertiliser production, gas utilities, transport and power generation, and also to export to European and Asian markets.
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. Application for the renewable hybrid plant to be connected to the grid would be made, fulfilling two specific objectives: for the sale/exchange of surplus/shortfall renewable energy into the grid, and the supply of energy to power Oracle Energy's Green Hydrogen and green ammonia production facility.
Market for Green Hydrogen
Domestic hydrogen production would allow Pakistan to reduce its reliance on imported energy resources and fossil fuels and cut its CO² emissions - Pakistan is targeting 30% of its energy requirements from renewable sources by 2030 - and the production of Green Hydrogen would provide a fully sustainable and renewable energy source for industrial use.
Oracle Energy has made rapid progress in the development of the Project to date. In October this year, it appointed thyssenkrupp Uhdeto ("thyssenkrupp") to lead the technical and commercial feasibility study for the Project, due to be released 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 with the green hydrogen certifier, TÜV SÜD. It is also in advanced discussions with potential offtake customers.
Naheed Memon, CEO, Oracle Power commented:
"The signing of the 30-year lease in Pakistan's most advanced region for the development of renewable energy marks a critical milestone in the development of Oracle Energy's Green Hydrogen Project. The sizeable site provides all the key ingredients needed to build a hydrogen project of this significant scale: access to unlimited renewable energy and water sources, as well as excellent transportation and transmission infrastructure.
Our financial partnership with His Highness Sheikh Ahmed Dalmook Al Maktoum, as well as with thyssenkrup, TÜV SÜD and other leading international companies, provides Oracle Energy with a substantial advantage to build what would be Pakistan's first ever large scale green hydrogen plant.
We will be commencing on site project and environmental studies as we rapidly move forward to establish ourselves as a supplier of sustainable and vital green energy fuel. Oracle is committed to delivering clean, cost-effective energy solutions, of which clean hydrogen would be a critical contributor. We look forward to becoming a significant producer of green energy in the region, and to supplying world markets."
His Highness Sheikh Ahmed Dalmook Al Maktoum stated:
"Oracle Energy is moving rapidly towards its next phase of development with the securing of an ideal location for the Green Hydrogen Project in the Gharo-Jhimpir corridor. The Project addresses one of the most important issues facing the planet at the moment. The provision of Green Hydrogen is rapidly gaining recognition globally as one of the solutions to transitioning from fossil to zero carbon energy generation."