Adnoc, ExxonMobil to build world’s largest low-carbon hydrogen facility

His Highness Sheikh Khaled Bin Mohamed Bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Chairman of the Abu Dhabi Executive Council, has witnessed the signing of a strategic partnership between Adnoc and ExxonMobil Corporation, in which Adnoc will acquire a 35 per cent equity stake in ExxonMobil’s proposed low-carbon hydrogen and ammonia production facility in Baytown, Texas, US.

Sheikh Khaled Bin Mohamed bin Zayed emphasised the importance of collaboration in supporting the UAE’s efforts to ensure the security and sustainability of the global energy sector and strengthen the UAE’s position as a global producer and supplier of low-carbon hydrogen.

He reaffirmed that the development of the facility aligns with the leadership’s vision to invest in and advance clean energy projects in the UAE and internationally.

The strategic agreement represents a significant investment in US energy production and the global energy transition, aiming to reduce greenhouse gas emissions across hard-to-decarbonise sectors, including industry, energy and transportation, meet the rising demand for lower-carbon fuels, and accelerate a net-zero future.

Contingent on supportive government policy and necessary regulatory permits, the facility is expected to be the world’s largest of its kind upon startup, capable of producing up to 1 billion cubic feet daily of low-carbon hydrogen which is near carbon-free with approximately 98 per cent of carbon dioxide removed and more than 1 million tonnes of low-carbon ammonia per year. A final investment decision (FID) is expected in 2025 with anticipated startup in 2029.

Dr Sultan Bin Ahmed Al Jaber, Minister of Industry and Advanced Technology and Managing Director and Group CEO of the Abu Dhabi National Oil Company (Adnoc), said, “This strategic investment is a significant step for Adnoc as we grow our portfolio of lower-carbon energy sources and deliver on our international growth strategy. We look forward to partnering with ExxonMobil on this low carbon-intensity and technologically advanced project to meet rising demand and help decarbonise heavy-emitting sectors.”

The facility will leverage advanced carbon capture and storage technologies to reduce emissions associated with hydrogen production.

Darren Woods, ExxonMobil Chairman and CEO, said, “This is a world-scale project in a new global energy value chain. Bringing on the right partners is key to accelerating market development, and we’re pleased to add Adnoc’s proven experience and global market insights to our Baytown facility.” Following FID for the project, Adnoc intends to support ongoing community initiatives in the Baytown area, in line with the company’s commitment to sustainability and education in the locations where it operates. This commitment reflects Adnoc’s broader strategy to foster community development and ensure that the benefits of its projects extend beyond environmental gains to include social and economic advancements.

A few days earlier, Adnoc,  Petronas and Storegga announced the signing of a Joint Study and Development Agreement (JSDA) to evaluate the carbon dioxide (CO2) emissions storage capabilities of saline aquifers and the construction of carbon capture and storage (CCS) facilities in the Penyu basin, offshore Peninsular Malaysia.

The agreement is targeting at least 5 million tonnes per annum (mtpa) of CO2 capture and storage capacity by 2030, and its scope includes a CO2 shipping and logistics study, geophysical and geomechanical modelling, reservoir simulation and containment research while exploring the application of advanced technologies, including artificial intelligence (AI), to enhance storage capacity.

Nora’in Md Salleh,  Petronas CCS Solutions Sdn. Bhd. (PCCSS)’ s Chief Executive Officer, said, “This agreement with Adnoc and Storegga will potentially allow us to build our capability to develop and de-risk saline aquifers as carbon dioxide storage sites by leveraging on our partners’ expertise and experience in other regions.

“This strategic partnership aligns with Petronas’ overarching goal of establishing Malaysia as a regional CCS hub to serve Asia Pacific, where it may build up the storage capacity through saline aquifers. This also demonstrates our earnestness in establishing the right pace to deliver CCS hubs here while also contributing to the national climate target.”

Petronas is a member of Malaysia’s National Energy Transition Roadmap (NETR) Committee, which has identified CCS as one of six energy transition levers to enable the country to be sustainable, low-carbon and resilient. The Malaysian Government is set to table a standalone CCUS bill by the end of 2024.

Nora’in Md Salleh added, “Malaysia is interested in intensifying bilateral economic partnerships with the UAE in the fields of economy, tourism, entrepreneurship, SMEs, fintech, innovation, transportation, renewable energy, logistics, agriculture, food security, environment and infrastructure within the Malaysia-UAE Joint Committee for Cooperation (JCC) framework.

“With the signing of the JSDA,  Petronas supports the JCC and enhances the established relationship between Petronas and Adnoc, reciprocating Petronas’ presence in Adnoc’s unconventional upstream business in Abu Dhabi.”

WAM