Treasury plays waiting game on funding Hyphen stake
The finance ministry says it would need “certainty” regarding the sector’s operations before it commits funding for a 24% stake in Hyphen Hydrogen Energy’s green hydrogen project near Lüderitz.
Green hydrogen commissioner James Mnyupe, speaking during African Energy Week held in Cape Town recently, said government may use newly found oil and gas riches to fund its equity stake in green hydrogen.
But according to Wilson Shikoto, the finance ministry’s spokesperson, this is not a done deal. “Treasury has not made a determination that oil proceeds will be utilised to fund the equity stake in Hyphen," he said.
Government in June said it consciously chose to fund its 24% equity participation in Hyphen’s project – at a minimum cost of N$16 billion – in order to guard against escalating costs of equity capital for investors that free equity could bring about.
Shikoto told Namibian Sun that funding mechanisms regarding government’s planned acquisition of the equity stake had still not been finalised.
“Treasury has not incorporated any activities or revenues relating to the oil and gas sector in the macro-fiscal framework, and will only do so once there is more certainty regarding the operations of the sector,” he said.
Wealth Fund at standstill
Government was also in the process of finalising a bill on how the Welwitschia Sovereign Wealth Fund would be managed.
“Regarding the funding of the Sovereign Wealth Fund, the ministry is busy finalising the draft bill which will contain the details of the proposed funding sources for the fund,” Shikoto said.
Motivating the proposal to fund government’s equity stake in Hyphen, Mnyupe said various countries were using their oil and gas resources to develop their green hydrogen industries.
“All these countries that are spending a lot of money to subsidise their hydrogen projects are funding it with oil and gas money,” he said.
“With all due respect, it is hard for us as Namibia, which cannot fully fund its education budget, to develop a hydrogen project without looking to utilise all the resources at our disposal."
Green hydrogen commissioner James Mnyupe, speaking during African Energy Week held in Cape Town recently, said government may use newly found oil and gas riches to fund its equity stake in green hydrogen.
But according to Wilson Shikoto, the finance ministry’s spokesperson, this is not a done deal. “Treasury has not made a determination that oil proceeds will be utilised to fund the equity stake in Hyphen," he said.
Government in June said it consciously chose to fund its 24% equity participation in Hyphen’s project – at a minimum cost of N$16 billion – in order to guard against escalating costs of equity capital for investors that free equity could bring about.
Shikoto told Namibian Sun that funding mechanisms regarding government’s planned acquisition of the equity stake had still not been finalised.
“Treasury has not incorporated any activities or revenues relating to the oil and gas sector in the macro-fiscal framework, and will only do so once there is more certainty regarding the operations of the sector,” he said.
Wealth Fund at standstill
Government was also in the process of finalising a bill on how the Welwitschia Sovereign Wealth Fund would be managed.
“Regarding the funding of the Sovereign Wealth Fund, the ministry is busy finalising the draft bill which will contain the details of the proposed funding sources for the fund,” Shikoto said.
Motivating the proposal to fund government’s equity stake in Hyphen, Mnyupe said various countries were using their oil and gas resources to develop their green hydrogen industries.
“All these countries that are spending a lot of money to subsidise their hydrogen projects are funding it with oil and gas money,” he said.
“With all due respect, it is hard for us as Namibia, which cannot fully fund its education budget, to develop a hydrogen project without looking to utilise all the resources at our disposal."
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