RWE Exits $10B Hyphen Green Ammonia Project, Namibia’s Hydrogen Hub Plans Hit Setback
German power utility RWE has withdrawn from Namibia’s $10 billion Hyphen Green Ammonia venture, delivering a major blow to the southern African nation’s aspirations to become a leading hydrogen hub.
The decision highlights growing caution among energy companies toward costly investments in emerging technologies, particularly amid slower-than-expected demand for hydrogen and hydrogen derivatives in Europe.
RWE had signed a preliminary, non-binding memorandum of understanding with Hyphen in 2022 to purchase approximately 300,000 tonnes of ammonia annually from 2027, according to Reuters.
Ammonia — widely used as a fertiliser — is traditionally produced from natural gas. Decarbonising the process requires replacing gas with hydrogen generated from water using renewable energy.
“We can confirm that RWE is currently not pursuing any further projects in Namibia,” the company stated, noting that the pace of hydrogen adoption in Europe has influenced its decision.
“Against this backdrop, we have reviewed relevant projects, including the project with Hyphen in Namibia.”
Hyphen spokesperson Ricardo Goagoseb emphasised that RWE’s involvement was exploratory and that no final purchase agreement had been signed.
The project has also faced opposition from indigenous rights groups, who in April urged RWE to reconsider, arguing that the planned concession lies within a national park and encroaches on ancestral Nama land.
Andrea Pietrafesa, legal adviser at the European Centre for Constitutional and Human Rights, alongside the Nama Traditional Leaders Association, welcomed RWE’s withdrawal, stating it avoided “purchasing goods produced on land where indigenous rights are violated.”
RWE, however, said its decision was not related to these complaints.
RWE’s exit comes at a sensitive time for Namibia. Under its new administration led by President Netumbo Nandi-Ndaitwah, the country is aiming to regain upper-middle-income status after the World Bank downgraded it to lower-middle-income amid fiscal challenges.
The government has set an ambitious 7% economic growth target, anchored largely on green hydrogen, renewable energy, and value-added manufacturing to boost GDP.
Hyphen was a central part of this vision, promising to create 15,000 jobs during construction and 3,000 permanent roles, as part of a broader plan to generate 30,000 green jobs by 2030.
Scaling back or delaying the project threatens not only job creation but also Namibia’s ability to attract financing, secure offtake agreements, and achieve its green-energy ambitions.
With unemployment officially above one-third of the labour force, the potential economic impact could be significant.
Without a major anchor customer like RWE, Namibia faces increased risks of losing investor confidence in its hydrogen strategy — a setback for a nation counting on green energy as a pathway to higher income status.
