ADNOC to Acquire 35% of ExxonMobil’s Baytown Low Carbon Hydrogen and Ammonia Facility
- 05-Sep-2024 11:40 AM
- Journalist: Stella Fernandes
On September 4, 2024, Sheikh Khaled bin Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Chairman of the Abu Dhabi Executive Council, observed a significant agreement where the Abu Dhabi National Oil Company (ADNOC) will acquire a 35% equity stake in ExxonMobil Corporation’s planned low-carbon hydrogen and ammonia production facility in Baytown, Texas. This agreement represents a strategic investment in the U.S. energy sector and a vital contribution to the global transition toward cleaner energy.
The Baytown project is expected to play a key role in reducing greenhouse gas emissions across challenging sectors like industry, energy, and transportation. By meeting the growing demand for low-carbon fuels, the facility aims to support the push for a net-zero future. The project's success will depend on favorable government policies and regulatory approvals. Once operational, it is projected to become the largest facility of its kind globally, capable of producing up to 1 billion cubic feet of low-carbon hydrogen per day, with 98% of its carbon dioxide (CO2) emissions captured. Additionally, it will generate over 1 million tons of low-carbon ammonia annually. A final investment decision (FID) is expected by 2025, with the plant's startup scheduled for 2029.
Dr. Sultan Ahmed Al Jaber, UAE Minister of Industry and Advanced Technology and ADNOC’s Managing Director and Group CEO, highlighted the significance of this investment in ADNOC’s strategy to expand its portfolio of low-carbon energy sources. He stated, “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 employ advanced carbon capture and storage (CCS) technologies to significantly reduce emissions from hydrogen production. ADNOC’s involvement in this project reinforces its role in supporting the global energy transition while diversifying its international presence. The construction of the plant is also expected to bring economic benefits to Baytown, the broader Houston region, and Texas as a whole by creating U.S. jobs and supporting community development programs.
Darren Woods, Chairman and CEO of ExxonMobil, expressed appreciation for Sheikh Khaled's backing of the partnership. He remarked, “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.”
In line with its commitment to sustainability and social responsibility, ADNOC plans to support ongoing community development initiatives in Baytown after the FID. This approach reflects ADNOC’s broader strategy to extend the benefits of its energy projects beyond environmental improvements, emphasizing both social and economic progress in the areas where it operates. This collaboration signals a significant step forward for both ADNOC and ExxonMobil in advancing the global energy transition while contributing to local communities.