A huge deal between three global energy firms could bring a multi-million pound boost for Teesside.

Mayor Ben Houchen has welcomed a deal between bp, ADNOC (the Abu Dhabi National Oil Company) and renewable energy developer and operator Masdar which would see them collaborate to develop low carbon hydrogen hubs, supporting a wave of investment and jobs in the Tees Valley.

The three have signed an agreement to work together to initially develop 2GW of low carbon hydrogen across hubs in the UK and United Arab Emirates (UAE).

Mayor Houchen visited No.10 Downing Street to welcome the deal, in a meeting including industry leaders and Prime Minister Boris Johnson. The deal could lead to the first international investment in the low carbon hydrogen facility in Teesside (H2Teesside), aiming to produce 1GW of blue hydrogen starting in 2027.

“Blue” hydrogen is produced by converting natural gas into hydrogen and carbon dioxide which is then captured and permanently stored. H2Teesside would capture and store up to two million tonnes of CO2 a year through Net Zero Teesside and Northern Endurance Partnership’s carbon capture, utilisation and storage projects in the region, including Teesworks.

Mayor Houchen said: “Low carbon hydrogen is a vital contributor to the UK’s net zero ambitions and, like the Net Zero Teesside project, it’s happening right here, right now. This just cements our region at the forefront of the industry and, just as importantly, will help create even more good-quality, well-paid jobs for people in Teesside, Darlington and Hartlepool.

“The announcement shows global firms are serious about driving these projects of the future forward and are looking to do it on Teesside, undoubtedly attracting more carbon-intensive industries aiming to help meet carbon targets to sites like Teesworks.

“This is just one project that shows how our region, which produces more than 50% of the UK’s hydrogen, is perfectly placed to capitalise on innovation in the sector. We’re also the country’s first Hydrogen Transport Hub, already trialling cleaner vehicles and working with Northern Gas Networks to test hydrogen in domestic gas supplies right now.”

Bernard Looney, bp’s chief executive officer, said: “The UK and UAE governments have bold plans for decarbonisation. The UK is our home and we have worked in the UAE for nearly a century. By partnering with the visionary leaders of ADNOC and Masdar, we see massive business opportunity to generate the clean energy the world wants and needs – and at the same time revitalise local economies and create the jobs of the future.”

The Prime Minister said: “This is a clear indication that businesses in the energy sector are taking the transition to cleaner solutions seriously, and a major boost to the UK’s own net zero goals."

H.E. Dr. Sultan Ahmed Al Jaber, Group CEO of ADNOC and Chairman of Masdar added: “The UK and UAE have enjoyed decades of strong economic ties and the agreements will serve to deepen the strategic relationship between our countries. We look forward to building upon this legacy."