ADNOC to acquire a 35% equity stake in Baytown, Texas, project that will produce virtually carbon-free hydrogen
The strategic investment will support both companies’ net zero ambitions, accelerate decarbonization of hard-to-abate sectors, and meet rising demand for low-carbon hydrogen and ammonia
Facility expects to convert U.S.-produced natural gas into virtually carbon-free hydrogen, with ~98% of CO2 removed, advancing US competitiveness and supporting US jobs
Abu Dhabi, UAE and Spring, Texas – September 4, 2024: His Highness Sheikh Khaled bin Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Chairman of the Abu Dhabi Executive Council, has witnessed the signing of an agreement today, in which ADNOC will acquire a 35% equity stake in ExxonMobil Corporation’s (NYSE: XOM) proposed low-carbon hydrogen and ammonia production facility in Baytown, Texas.
The agreement represents a significant investment in the United States’ (US) energy production and the global energy transition. It will help reduce greenhouse gas emissions across hard-to-decarbonize sectors, including industry, energy and transportation, meet rising demand for lower-carbon fuels, and accelerate a net-zero future.
Contingent on supportive government policy and necessary regulatory permits, the facility is expected to be the world’s largest of its kind upon startup, capable of producing up to 1 billion cubic feet (bcf) daily of low-carbon hydrogen, which is virtually carbon-free with approximately 98% of carbon dioxide (CO2) removed and more than 1 million tons of low-carbon ammonia per year. A final investment decision (FID) is expected in 2025 with anticipated startup in 2029.
His Excellency Dr. Sultan Ahmed Al Jaber, Minister of Industry and Advanced Technology and ADNOC Managing Director and Group CEO, said: "This strategic investment is a significant step for ADNOC as we grow our portfolio of lower-carbon energy sources and deliver on our international growth strategy. We look forward to partnering with ExxonMobil on this low carbon-intensity and technologically advanced project to meet rising demand and help decarbonize heavy-emitting sectors.”
The facility will leverage advanced carbon capture and storage technologies to reduce emissions associated with hydrogen production. Creating U.S. jobs and supporting community development initiatives, the project’s construction will also bring substantial economic benefits to Baytown, the Houston area and Texas.
Darren Woods, ExxonMobil Chairman and CEO, said: “We appreciate His Highness Sheikh Khaled bin Mohamed bin Zayed Al Nahyan’s support for this groundbreaking partnership. This is a world-scale project in a new global energy value chain. Bringing on the right partners is key to accelerating market development, and we’re pleased to add ADNOC’s proven experience and global market insights to our Baytown facility.”
Following FID for the project, ADNOC intends to support ongoing community initiatives in the Baytown area, in line with the company’s commitment to sustainability and education in the locations where it operates. This commitment reflects ADNOC’s broader strategy to foster community development and ensure that the benefits of its projects extend beyond environmental gains to include social and economic advancements.
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Read the full news release here
