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Adnoc allocates Dh55b to low-carbon solutions

Huge funds earmarked for landmark decarbonization projects by 2030 including carbon capture, electrification, new CO2 absorption technology and enhanced investments in hydrogen and renewables

Adnoc on Thursday announced a Dh55 billion ($15 billion) plan to incorporate low-carbon solutions, new energies and decarbonisation technologies to ensure environment-friendly activities to achieve Net Zero target by 2050.

The state-owned energy giant, which unveiled a bold new strategy to progress the world-scale decarbonisation of its operations, said it will invest in clean power, carbon capture and storage (CCS), further electrification of its operations, and energy efficiency.

Dr Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and Adnoc Managing Director and Group CEO, said 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," Dr Jaber said.

New projects, initiatives

Under the plan, a suite of new projects and initiatives will be announced this year as the company reduces its carbon intensity by 25 per cent by 2030 and moves towards its net-zero by 2050 ambition.

The energy giant will introduce a first-of-its-kind CCS project, innovative carbon removal technologies, investment in new, cleaner energy solutions and strengthening of international partnerships. It will apply a rigorous commerical and sustainability assessment to ensure that each project delivers lasting tangible impact.

The latest initiatives are also in line with the UAE government's plans to invest $160 billion in clean and renewable energy sources over the next three decades.

“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," Dr Jaber said.

"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. This strategic, multi-billion-dollar initiative underscores Adnoc’s industry leadership as a leading global provider of lower-carbon energy,” he said.

Adnoc has a major share in most of the UAE’s oil and gas output and it has been investing heavily to increase production capacity of oil and gas. In addition, its is focusing on hydrogen and ammonia production to achieve net-zero emissions by 2050.

In 2022, Adnoc’s board of directors approved a Dh550 billion ($150 billion) budget for the next five years as the company receives a go-ahead to set up its gas subsidiary and list its shares on Abu Dhabi Securities Exchange this year. The board also endorsed plans to boost Adnoc’s production capacity to five million barrels per day by 2027 instead of the previous target of 2030.

Deployment of technology

Building on Adnoc’s Al Reyadah facility, which has the capacity to capture up to 800,000 tonnes of CO2 per year, the company will announce plans 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.

Combined with Adnoc’s planned expansion of its carbon capture capacity to five million tonnes per annum (mtpa) by 2030, the UAE will be firmly established as a worldwide hub for carbon capture expertise and innovation.

The company’s expansion of CCS is planned to support the significant scale-up of hydrogen and lower-carbon ammonia production capabilities in Abu Dhabi as Adnoc advances a world-scale one million tonnes 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. To-date, Adnoc has already delivered test cargoes of low-carbon ammonia to Europe and Asia.

100GW clean energy projects by 2030

Adnoc’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 from 20 gigawatts at present to 100GW by 2030.

Masdar, which currently operates in 40 countries and has a total investment of about $20 billion, is also spearheading the UAE’s drive to develop a leading position in green hydrogen.

Since January 2022, Adnoc has received 100 per cent of its grid power supply from Emirates Water and Electricity Company’s (EWEC) 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.

The Abu Dhab-based company also concluded a Dh13.94 billion ($3.8 billion) deal to build a first-of-its-kind, sub-sea transmission network in the Mena region, connecting its offshore operations to the onshore power network, with the potential to reduce Adnoc’s offshore carbon footprint by up to 50 per cent.

Building on the multi-billion capital investment in decarbonisation projects, Adnoc is working closely with its international partners and stakeholders across the energy value chain to collaborate on technology, best practices and policy to support and drive global decarbonization efforts.

KEY TAKEAWAYS

> Multi-year action plan follows board approval of Adnoc’s Net Zero by 2050 ambition, and builds on its strong track record in responsible energy production

> Adnoc invites global technology and industry leaders to work in partnership and drive real action to embrace the energy transition as it continues to future proof its business

> Strategic programme is a key enabler of Adnoc’s Net Zero by 2050 ambition and goal to reduce carbon intensity by 25 per cent by 2030

— muzaffarrizvi@khaleejtimes.com