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UAE to build $1 billion green ammonia facility in clean energy push

Highlights

Facility to produce 200,000 mt of green ammonia

To be powered by 800 MW solar power plant

UAE investing in green and blue ammonia projects

The UAE's Khalifa Industrial Zone Abu Dhabi or KIZAD has announced plans to build a $1 billion green ammonia facility in the free zone targeting regional and international markets as OPEC's third-largest oil producer boosts investments in clean energy.

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Helios Industry, a privately-owned special project vehicle company or SPV, will invest to develop the facility over several years in two phases to eventually produce 200,000 mt of green ammonia, KIZAD said in a May 25 statement. The green ammonia, which will be produced from 40,000 mt of hydrogen, will be powered by an 800 MW solar power plant. KIZAD, which is a unit of state-owned Abu Dhabi Ports, did not say when the 200,000 mt will be produced and whether it is annual production.

The UAE is investing in various hydrogen projects as the Gulf state seeks to capitalize on the global appetite for green energy products as the energy transition trend gains momentum.

Abu Dhabi National Oil Co. plans to build a blue ammonia facility as the UAE's biggest energy producer looks to become a leader in hydrogen production.

The blue ammonia facility, which will be located in the Ruwais industrial hub in the oil-rich emirate of Abu Dhabi, will have a 1 million mt/year capacity, ADNOC said May 24.

The facility, part of the TA'ZIZ industrial park in Ruwais, is envisaged to start production in 2025. ADNOC did not disclose the cost of the project. Blue ammonia is made from nitrogen and blue hydrogen, which is produced from natural gas feedstocks, with the CO2 by-product from hydrogen production captured and stored.

Hydrogen exports

Currently ADNOC produces 300,000 mt/year of hydrogen and has plans to boost capacity to more than 500,000 mt/year. ADNOC's Al Reyadah project can capture 800,000 mt/year of CO2 from local UAE steel production and the company plans to boost its carbon capture utilization and storage capacity to 5 million mt/year by 2030.

ADNOC has struck a number of hydrogen agreements since the end of last year, when Abu Dhabi's former Supreme Petroleum Council mandated the national oil producer to become a leader in the production of hydrogen.

The UAE and ADNOC are eyeing hydrogen exports mainly to Asian countries and companies. ADNOC has signed hydrogen agreements with Japan's Ministry of Economy, Trade and Industry or METI and South Korea's GS Energy.

In April, the UAE energy ministry signed a cooperation agreement with METI under which Tokyo will consider developing an international hydrogen supply chain with the UAE under its first bilateral hydrogen cooperation deal as it accelerates efforts to deploy the large-scale use of hydrogen.

In January, METI struck the first fuel ammonia cooperation deal with ADNOC as Tokyo intends to develop its supply chain of the commodity, possibly in the Middle East, by the late 2020s.

The UAE's energy ministry, ADNOC, sovereign wealth funds ADQ and Mubadala Investment Co. formed a hydrogen alliance earlier in 2021 to promote the production and use of the fuel in the UAE and ultimately to export markets.