ADNOC Group from the UAE has agreed to purchase a 35% equity stake in ExxonMobil Corporation's upcoming hydrogen and ammonia production project in Baytown, Texas. This project is set to become the world's largest of its kind upon completion.

Source: GulfBusiness

In a joint statement, ADNOC and Exxon revealed that the production facility will be capable of generating up to 1 billion cubic feet daily of low-carbon hydrogen, which is nearly carbon-free and eliminates about 98% of carbon dioxide. Additionally, the facility aims to produce over 1 million tons of low-carbon ammonia annually.

The final investment decision is anticipated in 2025, with the commencement of production scheduled for 2029; however, the companies did not disclose the investment's value.

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.

ADNOC is the third significant industrial partner to join Exxon's initiative, which is expected to reduce greenhouse gas emissions in challenging-to-decarbonize sectors like industry, energy, and transportation.

In ADNOC's US investments, the acquisition of Exxon's Texas hydrogen project marks its second investment in the US. The energy giant had previously agreed to acquire a stake in NextDecade's liquefied natural gas (LNG) export project in May.

By advancing its decarbonization strategy, ADNOC has moved up its net zero carbon emissions target to 2045 and aims to eliminate methane emissions by 2030. The company is exploring technologies such as hydrogen and carbon capture to reduce emissions while seeking ways to continue supplying hydrocarbons to emerging industries.

In January, the board of directors of ADNOC increased the budget allocation for decarbonization projects, technologies, and lower-carbon solutions to a record $23 billion (Dhs84.4bn), up from $15 billion.

ADNOC's six listed portfolio companies collectively reported a revenue of $24.2 billion (Dhs89bn), a net profit exceeding Dhs16 billion, and an EBITDA of Dhs28.4 billion for the first half of 2024.