Adnoc said the project marks another step in its plan to reduce its carbon intensity by 25 per cent by 2030. Photo: Adnoc
Adnoc said the project marks another step in its plan to reduce its carbon intensity by 25 per cent by 2030. Photo: Adnoc
Adnoc said the project marks another step in its plan to reduce its carbon intensity by 25 per cent by 2030. Photo: Adnoc
Adnoc said the project marks another step in its plan to reduce its carbon intensity by 25 per cent by 2030. Photo: Adnoc

Adnoc starts work on new carbon capture storage project


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Adnoc has begun work on a project to inject captured carbon dioxide into a saline aquifer, a formation of porous rocks which contain brine.

The project, the “world’s first fully sequestered carbon dioxide injection well in a carbonate saline aquifer”, is expected to become operational in the second quarter of this year, the state-run oil company said in a statement on Wednesday.

Saline aquifers, porous sedimentary rocks that contain salt water, have great potential for carbon storage because they are found at appropriate depths and have bigger storage capacity than other geological reservoirs.

Adnoc’s project marks another step in the company’s plan to reduce its carbon intensity by 25 per cent by 2030, it said.

“Carbon capture and storage will play an important role in reducing emissions and achieving global climate goals,” Yaser Almazrouei, Adnoc upstream executive director, said.

This month, Adnoc said it would invest $15 billion in decarbonisation projects by 2030, including clean power, carbon capture and storage, further electrification of operations, energy efficiency and new measures to build on its policy of zero-routine gas flaring.

Last month, the state energy company set up a new low-carbon solutions and international growth unit that will focus on renewable energy, clean hydrogen and carbon capture and storage, as well as an international expansion into gas, liquefied natural gas and chemicals.

Adnoc, responsible for most of the UAE’s oil and gas output, has been investing heavily in the production of natural gas and hydrogen as the Emirates looks to reach net-zero emissions by 2050.

The company also said it had been meeting 100 per cent of its power requirements from solar and nuclear since January 2022, following an agreement with the Emirates Water and Electricity Company.

Once in service, the new project will initially sequester a minimum of 18,000 tonnes a year of carbon dioxide captured from Fertiglobe’s UAE operations for injection in Abu Dhabi’s onshore carbonate aquifers, Adnoc said.

“We will continue working to make today’s energy cleaner while investing in the clean energies and technologies of tomorrow to future-proof our business,” said Mr Almazrouei.

“In doing so, we will enable a lower-carbon future and remain a reliable and responsible energy provider to customers and markets around the world.”

On Tuesday, Adnoc said it would undertake a pilot project with British-Omani sustainability company 44.01 to permanently convert carbon dioxide from the air into a mineral within rock formations in Fujairah.

The project, which is also being carried out in partnership with the Fujairah Natural Resources Corporation and Masdar, will involve the use of technology that permanently mineralises carbon dioxide within rock formations found in Fujairah.

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”

Company Profile 

Founder: Omar Onsi

Launched: 2018

Employees: 35

Financing stage: Seed round ($12 million)

Investors: B&Y, Phoenician Funds, M1 Group, Shorooq Partners

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Updated: January 18, 2023, 9:28 AM