UAEBusiness

Adnoc launches $80 billion low-carbon energy and chemicals investment company

XRG plans to double its asset value over the next decade

Adnoc on Wednesday launched XRG, an international lower-carbon energy and chemicals investment company, with an enterprise value exceeding $80 billion.

XRG plans to double its asset value over the next decade by investing in low-carbon energy and chemicals, capitalising on the energy transition, artificial intelligence advancements and rise of emerging economies, the Abu Dhabi-based energy company said in a statement.

“XRG will drive sustainable economic growth, foster technological innovation, and deliver the energy and products needed to improve lives around the world,” said Dr Sultan Al Jaber, Adnoc’s managing director and group chief executive, and Minister of Industry and Advanced Technology.

“We are committed to delivering long-term value for our stakeholders and reinforcing Abu Dhabi and the UAE’s role as a global energy and chemicals leader.”

Adnoc said XRG’s chemicals platform aims to become a top-five global player, producing and delivering chemical and specialty products to meet a projected 70 per cent increase in global demand by 2050.

XRG will also invest in natural gas projects to meet growing demand for the fuel and its supercooled form, liquefied natural gas (LNG).

Its low carbon energies business will invest in clean energy solutions and technologies to reduce carbon emissions and drive economic growth during the energy transition.

Adnoc, which aims to achieve net zero by 2045, reported a reduction of 6.2 million tonnes of carbon dioxide equivalent in scope 1 (direct) and scope 2 (indirect) emissions last year. The reduction included 4.8 million tonnes from using clean grid energy from solar and nuclear power,Adnoc said in its 2023 sustainability report.

XRG will start operations in the first quarter of 2025. It will also host a global strategy event next year.

In October, Adnoc agreed to buy German chemicals maker Covestro for an enterprise value of €14.7 billion ($15.48 billion) as part of its efforts to become a major player in the chemicals industry.

Adnoc’s acquisition of Covestro was the UAE’s largest cross-border deal and the biggest foreign direct investment into Germany in the past five years. Leverkusen-based Covestro is one of the world’s largest manufacturers of high-quality polymer materials and their components.

Adnoc is also increasingly focusing on AI and digital technologies to boost efficiency and lower emissions related to its operations.

At Adipec this month, Adnoc and AIQ announced the launch of ENERGYai, the “world’s first” custom-built agentic AI solution for the energy industry. The platform seeks to combine large language model technology with AI “agents” that are trained in specific tasks across Adnoc’s value chain.

This month, Adnoc awarded a $920 million engineering, procurement and construction contract to expand its AI-driven well digitalisation programme across key oilfields in Abu Dhabi.

Adnoc generated $500 million last year by implementing AI solutions, following the integration of more than 30 AI tools across its entire value chain, from field operations to corporate decision-making, the company said in March.

Disruptive technologies, including AI, blockchain, cloud computing, cyber security, the Internet of Things, robotics and the metaverse, are transforming the oil and gas industry. A 2022 research paper by the World Economic Forum and Accenture showed that digitalisation could add between $1.6 trillion and $2.5 trillion to the industry in the next decade.

Source: thenationalnews

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