Abu Dhabi’s state-owned oil company is teaming up with two of its sovereign wealth funds to turn the oil-rich emirate into an exporter of blue and green hydrogen.
Abu Dhabi National Oil Co. has formed an alliance with Mubadala Investment Co. and ADQ will produce hydrogen from natural gas and renewable energy and commercialize the fuel abroad, as well as in the United Arab Emirates, ADQ said in a statement.
In a related transaction, Abu Dhabi Future Energy Co., also known as Masdar, has agreed with Siemens Energy AG to develop a facility to produce green hydrogen in the city of Masdar in Abu Dhabi, Mubadala said in a statement. Munich-based Siemens Energy is already building a hydrogen demonstration plant at the Mohammed bin Rashid Al Maktoum Solar Park in Dubai’s neighboring emirate.
Some Middle Eastern states that have built their fortunes on oil are looking to develop hydrogen as a fuel, due to a shift among some of their buyers towards less polluting alternatives to oil. Saudi Arabia’s energy minister said he wants the kingdom – the world’s biggest oil exporter – to become the largest hydrogen sender.
Abu Dhabi, like Saudi Arabia, produces natural gas, which it could use to develop what is known as blue hydrogen. It also has plenty of sunlight, which can be used to make a variant called green hydrogen. Abu Dhabi is the capital and largest emirate of the United Arab Emirates.
Adnoc will develop blue hydrogen independently, while cooperating with the two wealth funds to make the green variety, according to ADQ.
Adnoc produces about 300,000 tons of hydrogen annually for its downstream operations and plans to expand production to more than 500,000 tons, according to a statement. It is “well positioned to build its advantageous position as a major holder and producer of natural gas reserves,” said Adnoc.
(Updates with details of the second deal.)