Abu Dhabi National Oil Company (Adnoc) signed a joint study agreement with three Japanese companies to explore the commercial production of blue ammonia in the UAE.
The new deal was signed with Inpex Corporation, Jera and government-owned Japan Oil, Gas and Metals National Corporation, Adnoc said in a statement on Thursday.
“For almost five decades, the UAE and Japan have enjoyed a deep-rooted and successful strategic relationship, underpinned by long-standing energy partnerships,” Dr Sultan Al Jaber, UAE Minister of Industry and Advanced Technology and managing director and group chief executive of Adnoc, said.
“As we increase our focus on the potential of new lower carbon fuels and navigate the energy transition, the UAE and Adnoc are keen to build and strengthen our existing partnerships and seize growth opportunities with Japan that can help produce more energy with fewer emissions.”
The development comes following a virtual meeting between Dr Al Jaber and Kajiyama Hiroshi, Japan’s minister of economy, trade, and industry (Meti).
Currently, Adnoc is developing a world-scale blue ammonia production facility at the Ta’ziz Industrial Chemicals Zone in Ruwais which will have a capacity of 1,000 kilotonnes per year. It is also exploring further opportunities under the new agreement.
“This joint study agreement with Inpex, Jera and Jogmec provide a roadmap for us to deepen access to Japanese markets for Adnoc’s products and further strengthen the UAE’s hydrogen value proposition,” Dr Al Jaber, said.
Blue ammonia is a more easily transportable fuel source made from blue hydrogen, a by-product of carbon dioxide that has been captured and stored. It can be used as a low-carbon fuel across a wide range of industrial applications, including transportation, power generation, and industries including steel, cement and fertiliser production.
Adnoc is leveraging its status as a long-standing reliable and stable supplier of oil and gas to Japan to nurture new partnership opportunities between both countries. Japan is Adnoc’s largest international importer of oil and gas products with approximately 25 per cent of its crude imported from the UAE, according to the statement.
In January, the UAE and Japan agreed to cooperate on fuel ammonia and carbon recycling technologies following the signing of a cooperation agreement between Adnoc and Japan’s Meti.
Both the UAE and Japan enjoy strong bilateral economic relations dating back to 1961 when the first shipment of UAE crude oil was exported from the Umm al-Shaif offshore field in Abu Dhabi to Japan.
During the meeting, the ministers also reviewed joint efforts between both countries to enhance industrial cooperation and drive new opportunities for partnerships in hydrogen, renewables, and climate change.
The UAE is drawing up a comprehensive road map to position itself as an exporter of hydrogen and tap into the clean fuel’s potential.
Hydrogen has an estimated $11 trillion market potential, according to Bank of America Securities and is expected to generate $2.5tn in direct revenues and $11tn of indirect infrastructure by 2050 as its production increases six-fold. Globally, the size of the hydrogen industry is expected to hit $183 billion by 2023, up from $129bn in 2017, according to Fitch Solutions. French investment bank Natixis estimates that investment in hydrogen will exceed $300bn by 2030.
In January of this year, Adnoc, Mubadala and ADQ formed an alliance to develop a hydrogen economy in the UAE, focusing on low-carbon green and blue hydrogen as part of the country’s continued energy diversification efforts.
Earlier this week, Abu Dhabi National Energy Company, also known as Taqa, and Abu Dhabi Ports announced their plans to develop a 2 gigawatt green ammonia project in the UAE.
The planned facility will tap a 2 gigawatt solar photovoltaic plant to power an electrolyser to produce green hydrogen, which will in turn be processed into liquid ammonia. The green ammonia will be used in ships as bunker fuel and for export from Abu Dhabi Ports through gas carriers.