A massive blue ammonia project will be developed by Abu Dhabi National Oil Company  at its downstream hub in Ruwais, as it looks to grow the UAE’s hydrogen economy.

The company is advancing the design phase of the planned facility at the Ta’ziz industrial ecosystem, which is being developed with ADQ at Ruwais.

The facility will have a capacity to produce 1,000 kilotons of ammonia per year, Adnoc said in a statement on Monday.

Blue ammonia is a more easily transportable fuel source made from blue hydrogen, which is itself produced as a byproduct of carbon dioxide that has been captured and stored. The blue aspect of the product refers to the hydrogen derived from natural gas feedstocks.

“This is a significant milestone in the development of our blue hydrogen and ammonia business, building on the UAE’s strong position as a producer of competitive, low carbon natural gas and our leadership role in carbon capture and underground storage,” Dr Sultan Al Jaber, UAE Minister of Industry and Advanced Technology and Adnoc group chief executive and managing director, said.

The UAE is drawing up a comprehensive roadmap to position itself as an exporter of hydrogen and tap into the clean fuel’s potential.

Globally, the hydrogen industry is expected to grow to $183 billion by 2023, from $129bn in 2017, according to Fitch Solutions. French investment bank Natixis estimates that investments in hydrogen will exceed $300bn by 2030.

Adnoc, alongside Mubadala and ADQ, is part of an alliance to develop a hydrogen economy in the UAE.

Adnoc already produces 300,000 tons of hydrogen on an annual basis for its downstream operations and plans to ramp up its output significantly.

The company plans to expand its manufacturing capacity for the clean gas to more than 500,000 tons.

The blue ammonia facility will have synergies with Adnoc’s carbon capture project at Al Reyadah, which stores up to 800,000 tons of carbon dioxide from local steel production.

UK contractor Wood is undertaking front-end engineering and design on the ammonia project. The company is also executing six other chemical projects for the Ta’ziz joint venture.