ADNOC makes first UK investment with 25% stake in BP H2Teesside hydrogen project

ADNOC, the UAE’s largest energy firm, has acquired a 25% stake in the BP H2Teesside project.

The move, which marks the first UK investment for ADNOC, will see it come in at the design stage of the blue hydrogen project, which BP has mooted as Britain’s largest.

H2Teesside is expected to see development of two 500 megawatt (MW) production units by 2030, with operations targeted to start in 2027.

BP and ADNOC will now advance the project to the pre-FEED stage.

UAE-based renewables firm Masdar has also signed a memorandum of understanding to acquire an undisclosed stake in BP’s proposed HyGreen Teesside project, which is expected to produce 60MWe (megawatt electrical input) of hydrogen at start-up in 2025, increasing to up to 500MWe by 2030.

© Supplied by BP

The two projects could deliver 15% of the UK Government’s 10GW target for hydrogen production by 2030.

ADNOC and BP have not disclosed the values of the investments.

Announcing a flurry of agreements, the pair disclosed a BP deal to work with ADNOC in evaluating a new blue hydrogen project in Abu Dhabi, conducting a joint feasibility study for a “world-scale low-carbon” project there.

ADNOC, BP and Masdar have, in addition, announced they have joined with a with Abu Dhabi Waste Management Centre and Etihad Airways to explore production of sustainable aviation fuels, from hydrogen and municipal waste gasification, in the UAE.

BP CEO Bernard Looney said: “By joining forces with ADNOC and Masdar we are reinforcing the world-leading role that Teesside, and the UK more widely, can play in developing new supplies of energy, as well as new skills and supply chains. We’re backing Britain and the resources, capability and net zero ambition here in the UK make it ideal for the development of low carbon hydrogen – and together we can help deliver a significant contribution to the UK’s newly increased hydrogen ambition.

“As well as boosting home-grown energy, the global nature of our partnership with ADNOC and Masdar will support our plans to decarbonize some of the most hard-to-abate sectors in the world – like industrial manufacturing, power and aviation.

“Partnerships like this reach beyond borders to provide the new energy solutions the world needs, and I want to applaud Dr Sultan for his continued commitment to help solve the energy trilemma of providing the world with secure, affordable and cleaner energy.”

Sultan Ahmed Al Jaber, UAE industry minister, managing director of ADNOC and chairman of Masdar, said the deal is a “testament” to the UAE and UK’s longstanding partnership, and aims to play leading roles in the international clean energy sector.

“To that end, we welcome the opportunity to collaborate with BP in both the UAE and UK, laying the groundwork for deeper commercial partnership in the area of new energies and clean technologies.

“In the UK, our role in Teesside will represent ADNOC’s first investment into the UK and help to accelerate innovation in decarbonisation of energy in industrial sectors. Similarly, the partners’ collaboration in Abu Dhabi is expected to further position the UAE as a regional leader in low-carbon energies and technology-driven industrial growth.”