Oman’s wealth fund invests in US-based EV battery start-up

Oman Investment Authority and Our Next Energy to identify partnerships in energy storage

Our Next Energy's headquarters in Novi, Michigan. The EV battery start-up is valued at $1.2 billion. Reuters

John Benny
Sep 06, 2023

The Oman Investment Authority has invested in US-based electric vehicle battery start-up Our Next Energy (One).

Oman’s sovereign wealth fund also signed a strategic co-operation agreement with One to identify potential areas of partnership in energy and battery storage in the sultanate, Oman News Agency reported on Wednesday.

The financial value of the transaction was not disclosed.

The move, which is consistent with Oman’s strategy to reach net-zero emissions by 2050, will ensure the growth of the electric car market, said Ibrahim Al Eisri, director general of private equity investments at the Oman Investment Authority.

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In March, Oman signed a deal with the UK's Knights Bay to extract nickel in the sultanate's first mineral exploration agreement with a foreign partner.

The initial investment in the exploration and evaluation phase is about $25 million to $30 million in the first three years, Oman News Agency quoted the sultanate's Ministry of Energy and Minerals as saying.

EVs will make up about half of new car sales worldwide by 2035 as the push for net-zero carbon emissions picks up pace, Goldman Sachs Research said in a February report.

Sales will soar to 73 million units in 2040, from about two million in 2020, with the percentage of EVs in global car sales projected to rise to 61 per cent, from 2 per cent, during the period, the US investment bank said.

The International Energy Agency expects global electric car sales to surge by 35 per cent to 14 million this year.

These investments will contribute to accelerating the company’s progress towards a sustainable future and allow it to expand the scope of its products and networks to the global market, said Mujeeb Ijaz, founder and chief executive of One.

In February, One closed a $300 million series B capital raise, valuing the company at $1.2 billion. The investment round was led by venture capital firm Fifth Wall and Franklin Templeton, according to its website.

Oman, the largest non-Opec producer in the Middle East, has been investing heavily in sectors such as renewable energy and tourism in an effort to diversify its economy.

The sultanate is on track to become one of the largest producers of hydrogen in the world by 2030, the IEA said in a June report.

The country, which could also be the top exporter of the low-carbon fuel in the Middle East by the end of the decade, benefits from ample renewable energy sources and vast tracts of available land, the Paris-based agency said.

Last year, Oman set up a state-owned company, Hydrogen Oman, to oversee the development of hydrogen projects in the country.