Adipec 2021: Mitsui and GS Energy to help develop blue ammonia project

The agreements build on Adnoc's sale of blue ammonia to Japan and South Korea with the Asian companies partnering with Ta’ziz and Fertiglobe

Adnoc is developing a world-scale blue ammonia production plant in Ruwais. Photo: Adnoc

Abu Dhabi National Oil Company and holding company ADQ signed an agreement with Japan's Mitsui and South Korea's GS Energy to help develop a blue ammonia project in the emirate's downstream hub of Ruwais in partnership with Ta’ziz and Fertiglobe.

“The strategic partnerships with Mitsui and GS Energy, two of East Asia’s global energy champions, reflect Adnoc's commitment to increase the production of low-carbon hydrogen and ammonia," said Dr Sultan Al Jaber, Minister of Industry and Advanced Technology and group chief executive and managing director of Adnoc.

The agreements build on Adnoc's previous sales of blue ammonia to Japan and South Korea.

"As the world embraces the energy transition, we will work closely with our new partners to jointly develop new hydrogen markets and applications for low-carbon ammonia to meet the needs of global export markets for the energy and industry markets in Japan and Korea," Dr Al Jaber said.

Fertiglobe, the joint venture between Adnoc and Amsterdam-listed OCI, is developing a large blue ammonia plant in the UAE’s downstream hub in Ruwais. The plant will have a production capacity of 1,000 kilotonnes a year.

Blue ammonia is a chemical compound produced using hydrogen, manufactured through steam methane reformation. Ammonia is one of the easiest ways to store and transport hydrogen.

Gulf oil exporters are increasingly prioritising the development of hydrogen, a cleaner fuel, that is considered a viable tool for decarbonisation.

This year, Adnoc formed a hydrogen alliance with ADQ and investment company Mubadala for the development of the hydrogen economy in the UAE.

Opec's third-largest producer is looking to capitalise on its existing hydrocarbon trade ties with crude importers such as Japan and South Korea, to sell cleaner forms of the fuel.

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Adnoc already produces 300,000 tonnes of hydrogen on an annual basis for its downstream operations and plans to increase its output significantly.

Mitsui and GS Energy in return for their equity participation will offtake significant volumes of blue ammonia, to meet the growing demand for energy and industry in Japan and South Korea, respectively.

Earlier this year, Adnoc sold volumes of blue ammonia to Japan's Inpex, Idemitsu as well as trading house Itochu for use in fertiliser production.

Hydrogen has been earmarked for industrial decarbonisation in Japan.

Saudi Aramco has also prioritised the development of blue and green hydrogen. The green variant is produced through electrolysis powered by renewable sources such as solar and wind. The company said it was exploring opportunities in blue hydrogen and is actively looking at exporting to key markets in Asia.