The agreement was signed in Dusseldorf, Germany, by Frank Hyldmar, chief executive of Currenta, Mona Neubaur, Deputy Prime Minister of North Rhine-Westphalia and state minister for economics, industry, climate protection and energy, and Musabbeh Al Kaabi, executive director of low carbon solutions and international growth directorate at Adnoc (from left). Photo: Adnoc
The agreement was signed in Dusseldorf, Germany, by Frank Hyldmar, chief executive of Currenta, Mona Neubaur, Deputy Prime Minister of North Rhine-Westphalia and state minister for economics, industry, climate protection and energy, and Musabbeh Al Kaabi, executive director of low carbon solutions and international growth directorate at Adnoc (from left). Photo: Adnoc
The agreement was signed in Dusseldorf, Germany, by Frank Hyldmar, chief executive of Currenta, Mona Neubaur, Deputy Prime Minister of North Rhine-Westphalia and state minister for economics, industry
Adnoc has signed a preliminary agreement with Germany’s North Rhine-Westphalia and Currenta, a chemical industry services provider, to explore opportunities for the creation of a low-carbon ammonia value chain.
The primary focus of the agreement will be the production and transportation of low-carbon ammonia and its application as a fuel in energy generation, including industrial-scale testing at Currenta’s site in Dormagen, Germany, Adnoc said in a statement on Monday.
Ammonia, a compound of nitrogen and hydrogen, can be used as a low-carbon fuel across industrial applications, including transportation, power generation, and industries including steel, cement and fertiliser production.
"Our fast-growing ammonia business is enabled by the UAE’s abundant and competitive energy resources," said Musabbeh Al Kaabi, executive director of low carbon solutions and international growth directorate at Adnoc.
"Adnoc is committed to meeting the growing global demand for lower-carbon intensity energy."
The state oil company has already invested in low-carbon ammonia, where the carbon dioxide emitted during production is captured and stored underground.
In May 2021, Adnoc also announced a million tonnes per year low-carbon ammonia production facility at the Ta'ziz industrial hub in Ruwais.
In January, Adnoc also signed a preliminary agreement with the engineering unit of Germany's Thyssenkrupp to create new markets for hydrogen and explore the development of projects for large-scale ammonia cracking.
The company has also expanded its energy partnerships across the hydrogen value chain.
Adnoc shipped its first low-carbon ammonia cargo to Germany in September last year and has also sent demonstration cargoes to customers in Asia.
"We will do our utmost to expand the capacities for the generation of renewable energies and for the production of other climate-neutral energy carriers such as green hydrogen in this country as much as possible," said Mona Neubaur, Deputy Prime Minister of North Rhine-Westphalia and State Minister for Economics, Industry, Climate Protection and Energy.
"However, it is also clear that we will have to import various green energy sources in large quantities in order to cover our needs and to achieve our climate protection goals. We are now building partnerships and a broad import infrastructure to supply our industry. The basis for our co-operations is diversification with many countries.”
Power plants could potentially use 100 million tonnes of low-carbon ammonia as feedstock by 2050, according to Wood Mackenzie.
It is also used to transport hydrogen over long distances.
"Ammonia has the potential to play an important role in decarbonisation, for example, as a hydrogen carrier, or as a fuel in heat generation," said Frank Hyldmer, chief executive of Currenta.
"As a chemical park operator with large steam and heat generation plants, Currenta is observing very closely to see whether it succeeds in realising this potential. An important factor here is the development of global supply chains for ammonia."
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
