A hydrogen megaproject in Namibia: New sales opportunities for German valve manufacturers?

The project is located in the "Sperrgebiet National Park" in south-western Namibia. Diamonds used to be mined here (Source: Adobe)

Namibia is considered an important export partner for the German hydrogen ramp-up. In particular, the Hyphen project operated by a German-British joint venture has made a name for itself. The project was recently honored as an "Energy Transition Changemaker" at the United Nations Climate Change Conference (COP28). Read on to find out what exactly is planned for the Namibian coast, why the project is an international model and what opportunities it offers for the German fittings market.

Presentation of the awards in Dubai on December 8, 2023 (Source: Enertrag)

A total of 10 projects from the fields of renewable energies, energy efficiency, hydrogen and heavy industry received the "Energy Transition Changemaker" award on December 8 in Dubai. With this initiative, the COP28 presidency wanted to draw attention to lighthouse projects that can serve as an international role model for decarbonization. The German company Enertrag is playing a key role in two of these projects: Hyphen in Namibia and HyShift in South Africa. Hyphen in particular is worth a closer look, as it promises to export huge quantities of green hydrogen abroad at a low price and at the same time boost the local economy, infrastructure and employment situation.

Project rendering (source: Enertrag)

Hyphen: A national park supplies hydrogen instead of diamonds

The British investment company Nicholas Holdings Limited and the German company Enertrag SE, based in Schenkenberg-Dauerthal in Brandenburg, founded the joint venture Hyphen Hydrogen Energy ("Hyphen") to plan, implement and operate the project. In June 2021, it was awarded the contract for the huge project, which the Namibian government had put out to tender as part of its "Southern Corridor Development Initiative".

What is it about? Following its successful auction, Hyphen was allowed to lease an area of around 4,000 km² in the Tsau-ǁKhaeb (Sperrgebiet) National Park, where it now wants to build the country's first integrated hydrogen plant. This marks the beginning of a new chapter for the national park on the south-west coast of Namibia, once known as "Diamond Area 1": German companies discovered diamonds here in 1908, the mining of which was later continued by British companies until the early 21st century.

Over the next 40 years - which is how long Hyphen is allowed to manage the area - the economic use of the park is expected to be far more sustainable. According to the operators, the total cost of the project is USD 9.4 billion - almost equivalent to the country's GDP, which was USD 12.6 billion in 2022. The plan is to build wind and solar power plants with a total capacity of up to 7 GW. That would be the equivalent of around seven coal-fired power plants. The joint venture intends to use the green electricity to operate several electrolysers, which are expected to produce around 300,000 tons of green hydrogen per year with a capacity of 3 GW. By way of comparison, the German government's National Hydrogen Strategy envisages an installed electrolysis capacity of 10 GW by 2030.

In Windhoek, the Namibian government signed the feasibility and implementation agreement (FIA) for the project with Hyphen at the end of May 2023 (source: Hyphen)

Hydrogen for the world, industrialization for Namibia?

What is to be done with the hydrogen? A large proportion is to be converted into ammonia and exported. Hyphen plans to ship up to 2 million tons in this way by 2030. Presumably also to Germany, with which the country has had a "hydrogen partnership" since 2021 (see below) and project partner Enertrag operates several sites. The water required for electrolysis is to come from the nearby Atlantic Ocean via seawater desalination plants. According to the BMBF, the energy required for desalination only accounts for around 1% of the production costs of hydrogen. This is another reason why the project serves as a model for other projects in arid regions of the world.

According to Hyphen and the Namibian government, the large-scale project is just the first step in Namibia's hydrogen strategy. In 2022, representatives of the country announced at COP27 in Egypt that the South African state wanted to produce between 10 and 12 million tons of green hydrogen by 2050. McKinsey estimates that production costs of 1.50 US dollars/kg could be achieved. However, Namibia hopes that the hydrogen boom will not only generate revenue, but also industrialization, infrastructure and jobs.

Hyphen also wants to provide the latter: Initially, up to 15,000 workers are to be employed for the construction of the project, with 3,000 people later working in the area surrounding the energy and hydrogen park. It is a declared goal of the operators to recruit 90% of them from Namibia itself. Furthermore, the electricity plants are to produce more electricity than is required for hydrogen production so that some of it can be made available to the surrounding towns or even exported. In addition, 30% of the "goods, services and materials" required for the project are to be procured locally.

Martin Andjaba, Ambassador of the Republic of Namibia, the then Federal Research Minister Anja Karliczek and the then Federal Commissioner for Green Hydrogen at the BMBF, Stefan Kaufmann (Source: BMBF/Hans-Joachim Rickel)

German-Namibian hydrogen partnership

Due to their colonial past - after the Berlin Conference in 1884/85, the African state was part of the German Reich as "German South West Africa" until 1918 - Germany and Namibia still have close ties today. German is spoken in some parts of the country, including Lüderitz in the southwest. It therefore seemed obvious when the then Minister of Education and Research, Anja Karliczek, signed a "Declaration of Intent to establish a German-Namibian hydrogen partnership" in August 2021.

Karliczek said at the time that "there is a global race for the best hydrogen technologies and the best locations for hydrogen production. From our point of view, Namibia has a particularly good chance in this competition." She was "proud that we are the first to formally conclude a hydrogen partnership with Namibia." Karliczek also referred to the country's "large, previously unused area" and its good conditions for producing renewable electricity thanks to high wind speeds and over 3,500 hours of sunshine per year. Karliczek's conclusion: "We need large quantities and low kilo prices quickly. Namibia can deliver that."

In March 2022, the hydrogen cooperation with Namibia was also confirmed by the Federal Ministry for Economic Affairs and Climate Protection: Economics Minister Robert Habeck signed a corresponding agreement with Namibian Energy Minister Tom Alweendo. In December 2022, Habeck then visited the Namibian capital Windhoek, where he presented a funding decision for a project for the industrial production of iron based on green hydrogen. Many media outlets assume that the German government has firmly included Namibia in its list of potential hydrogen export partners. According to the National Hydrogen Strategy, Germany will not be able to do without imports: according to the strategy, between 95 and 130 TWh will be needed in 2030, between 50 and 70 % of which could come from abroad.

Official Enertrag project rendering (Source: Enertrag)

Export opportunities for hydrogen fittings made in Germany?

So what do the Namibian hydrogen plans mean for the German valve market? According to the VDMA, the potential for the industry is enormous. In the course of the hydrogen boom, investments worth billions are being made worldwide or are being planned - a large part of which is attributable to hydrogen megaprojects such as the one by Hyphen in Namibia. Valves and actuators play a key role in the context of these projects, as they are used along the entire hydrogen process chain. One advantage of the industry is that it already has many years of experience in handling the gas and its derivatives.

The applications here range from production in electrolysers and reformers to storage and transportation in tanks and pipelines and use in a wide variety of industrial sectors, for example as a process gas in the steel, cement, glass and chemical industries. In the context of electrolysis, not only hydrogen but also the media water and oxygen have to be treated. Therefore, the required fittings are very different in terms of their requirements - pressure, temperature and media handling - and in some cases highly specialized.

Companies that are already benefiting from this great potential are well known in the industry: Samson Pfeiffer is supplying more than 1,000 control and shut-off valves for a new plant in Saudi Arabia, AS-Schneider is pleased about hydrogen investments in the Middle East and the suppliers of large corporations such as Thyssenkrupp and Siemens are pleased about their plant projects around the globe. Namibia could soon join them, because wherever hydrogen is produced, stored and transported, there is automatically a need for the corresponding fittings.

You can find out more about hydrogen in the industrial sectors of fittings and valves at VALVE WORLD EXPO from December 3 to 5, 2024 in Düsseldorf. Current industry and product information can be found on the internet portal at www.valveworldexpo.de