UAE’s oil & gas giant earmarks $15 billion for low-carbon projects

In a bid to scale up its decarbonisation efforts by 2030, the UAE’s energy giant, Abu Dhabi National Oil Company (ADNOC), has hammered out a multi-year action plan and allocated $15 billion for low-carbon projects, covering carbon capture and storage (CCS), electrification, new CO2 absorption technology, hydrogen and renewables.

ADNOC revealed its new multi-year strategy on Thursday to progress the world-scale decarbonisation of its operations, as a key enabler of its net-zero by 2050 ambition and goal to reduce carbon intensity by 25 per cent by 2030. The UAE giant highlights that this builds on its “strong track record as a leading lower-carbon intensity energy producer, which includes its use of zero carbon grid power, a commitment to zero flaring as part of routine operations and deployment of the region’s first carbon capture project at-scale.”

Dr Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC Managing Director and Group CEO, remarked: “Under the directives of the UAE’s wise leadership and the ADNOC board of directors, ADNOC continues to take significant steps to make today’s energy cleaner while investing in the clean energies and new technologies of tomorrow.

“Now, more than ever, the world needs a practical and responsible approach to the energy transition that is both pro-growth and pro-climate, and ADNOC is delivering tangible actions in support of both these goals.”

To curb emissions and meet its net-zero goals, the company allocated $15 billion (AED 55 billion) to advance an array of projects across its diversified value chain by 2030, which will include investments in clean power, CCS, further electrification of its operations, energy efficiency and new measures to build on its policy of zero routine gas flaring. The UEA firm outlines that it will apply “a rigorous commercial and sustainability assessment” to ensure that each project delivers “lasting tangible impact.” 

“Cementing our strong track record of responsible and reliable energy production, ADNOC will fast-track significant investments into landmark clean energy, low-carbon and decarbonisation technology projects. As we continue to future-proof our business, we invite technology and industry leaders to partner with us, to collectively drive real and meaningful action that embraces the energy transition,” added Al Jaber.

In light of this, a suite of new projects and initiatives are anticipated to be announced throughout 2023, including “a first-of-its-kind CCS project, innovative carbon removal technologies, investment in new, cleaner energy solutions and strengthening of international partnerships,” underlines ADNOC.

Building on its Al Reyadah facility, which has the capacity to capture up to 800,000 tons of CO2 per year, ADNOC intends to deploy technologies to capture, store and absorb CO2 by leveraging the UAE’s geological properties while preparing for its next major investment to capture emissions from its Habshan gas processing facility.

Bearing this in mind along with the UAE player’s planned expansion of its carbon capture capacity to 5 million tons per annum (mtpa) by 2030, the UAE will be “firmly established as a worldwide hub for carbon capture expertise and innovation,” according to the firm’s statement.

Furthermore, the company elaborates that its expansion of CCS is planned to support the scale-up of hydrogen and lower-carbon ammonia production capabilities in Abu Dhabi while advancing “a world-scale 1 million tons per annum (mtpa) blue ammonia production facility at TA’ZIZ, the industrial services and logistics ecosystem that is enabling the expansion of the Al Ruways Industrial City, as well as Abu Dhabi’s wider chemicals, manufacturing and industrial sectors.”

ADNOC also confirms that it has already delivered test cargoes of low-carbon ammonia to Europe and Asia. The company’s expansion of its new energy portfolio will largely be delivered through its stake in Masdar, “the UAE’s clean energy powerhouse with over 20 gigawatts (GW) of clean energy today and plans to increase its capacity to 100 GW by 2030,” based on the UEA player’s statement. In addition, the firm claims that Masdar is spearheading the UAE’s drive to develop a leading position in green hydrogen.  

Moreover, ADNOC has received 100 per cent of its grid power supply since January 2022 from Emirates Water and Electricity Company’s nuclear and solar energy sources, “making it the first major company in the industry to decarbonise its power at scale through a clean power agreement of this kind.”

In addition, the energy giant announced the completion of a $3.8 billion deal to build “a first-of-its-kind, sub-sea transmission network in the MENA region,” connecting ADNOC’s offshore operations to the onshore power network, with the potential to reduce its offshore carbon footprint by up to 50 per cent.

Previously, ADNOC’s CEO pointed out that the world needs all the energy solutions it could get, including oil, gas, solar, wind, nuclear, and hydrogen. While emphasising the importance of the firm’s new multi-year action plan, Al Jaber concluded: “This strategic, multi-billion-dollar initiative underscores ADNOC’s industry leadership as a leading global provider of lower-carbon energy.”

In December 2022, another oil and gas giant, ExxonMobil, also stepped up its spending on low-carbon projects to $17 billion in its five-year corporate plan.