The groundbreaking news that the largest energy group in the United Arab Emirates is taking a huge stake in Teesside’s future has been welcomed by Tees Valley Mayor Ben Houchen who says ‘the eyes of the world are on us’.

ADNOC will take a 25% stake in the design stage of bp’s blue hydrogen project, H2Teesside and Masdar – the Abu Dhabi renewable energy company – has also signed a memorandum of understanding to acquire a stake in bp’s proposed green hydrogen project, HyGreen Teesside.

Read more: bp head on why diversity is vital to Teesside's future success

Mr Houchen told BUSINESSiQ: “This welcome news demonstrates the huge pulling power our region has in the cleaner, safer and healthier industries in the future. That this is ADNOC and Masdar’s first ever UK investment shows just how important and innovative and world-leading bp’s hydrogen plans are, and they’re taking place right here on Teesside.

“These schemes are game-changers for our area, helping to decarbonise industry and drive our net zero ambitions. We’re seeing time and time again that these are creating a snowball effect, with one big investment prompting another, delivering good-quality, well-paid jobs for local people in the process.

“This announcement is the latest in a long line of global firms backing our region, coming after the likes of Sabic’s £850million investment to restart its hydrocarbon cracker, Alfanar’s £1billion sustainable aviation fuels project and SeAH’s ambitious plans to build the worlds-largest monopile manufacturing facility at Teesworks. We might be leading the UK in its low carbon ambitions – but it’s equally clear that the eyes of the world are on us.”

Bernard Looney, bp’s chief executive 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.”

This will be ADNOC’s first investment in the UK. bp and ADNOC will now advance the project, initially to the next stage of design, the pre-FEED stage. H2Teesside is expected to kickstart the UK’s hydrogen economy at scale with the development of two 500MW hydrogen production units by 2030. The project is targeting start of operations in 2027.

HyGreen Teesside is planned to produce 60MWe (megawatt electrical input) of hydrogen at start-up in 2025, increasing to up to 500MWe by 2030.

Together, these two projects could deliver 15% of the UK Government’s recently expanded 10GW target for hydrogen production in 2030.

bp will also join ADNOC to evaluate a new blue hydrogen project in Abu Dhabi, conducting a joint feasibility study for a world-scale, low-carbon hydrogen project in the country. In addition, ADNOC, bp and Masdar have joined with Abu Dhabi Waste Management Centre (Tadweer) and Etihad Airways to explore production of sustainable aviation fuels, from hydrogen and municipal waste gasification, in the UAE.

The new agreements follow from the formation of a strategic partnership for clean energy solutions in the UK and UAE between bp, ADNOC and Masdar in September 2021, including the intention to work together to develop low carbon hydrogen hubs, such as at Teesside.


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