Masdar and Emirates Steel Arkan to develop MENA region’s first green hydrogen-based project to decarbonize the UAE’s hard-to-abate steel sector

22 NOV 2023
News Corporate
UAE entities launch first-of-its-kind research consortium for renewable and advanced aviation fuels
  • Pioneering green steel demonstration project could boost trade and accelerate decarbonization in sector currently responsible for up to 8 percent of global carbon emissions

  • Ahead of the UAE hosting UN climate change conference, COP28, the pilot project could cut CO2 in steel-making process by 95 percent and turbocharge UAE’s journey to becoming green steel production hub

Abu Dhabi Future Energy Company PJSC – Masdar, one of the world’s leading renewable energy companies, has partnered with Emirates Steel Arkan, (ADX: EMSTEEL), one of the largest publicly traded steel and building materials manufacturers in the region, to develop an innovative green hydrogen project to decarbonize the hard-to-abate steel sector in the UAE.

The pilot project is the first-of-its-kind in the Middle East and North African region. Located in the Emirates Steel Arkan production facilities at the Industrial City of Abu Dhabi, the project is currently in the installation phase. Electrolyzers have already been delivered to the site to help produce ‘green steel’, a premium product sought after by global manufacturers eager to meet their net-zero goals. Expected to be commissioned in early 2024, the project will demonstrate the use of green hydrogen - instead of natural gas - to extract iron from iron ore, a key step in steelmaking.

The rising global demand for green steel, presents huge growth potential for the UAE’s steel industry as the country aspires to be among the frontrunners to decarbonize the global steel value chain. The project shows how clean energy and heavy industry partners in the UAE are taking urgent action to accelerate decarbonization. It is also a significant step in enabling the UAE’s strategy of making the country one of the world’s largest hydrogen producers by 2031. Steel manufacturing contributes between 7 and 8 percent of worldwide carbon emissions. Decarbonizing this industry holds the key to propelling the world towards a net-zero future. With the UN climate change conference COP28 set to begin in the UAE at the end of this month, innovative projects that halt emissions without stifling progress will be a focus of international attention.

Active in over 40 countries and with a total electricity generation capacity of over 20GW, Masdar is targeting 100GW by 2030. Masdar will have a strong presence during COP28 in Expo City, Dubai, where it plans to showcase innovative projects including this pioneering partnership with Emirates Steel Arkan.

Mohamed Jameel Al Ramahi, CEO of Masdar, said:

Masdar is very pleased to be partnering with Emirates Steel Arkan on this innovative project to decarbonize this vital sector. Steel is an essential commodity driving economic growth and creating jobs and this project presents huge potential for reducing emissions while increasing trade. Masdar has been pioneering renewable energy projects around the world for more than 17 years. The UAE will once again demonstrate its climate leadership by hosting COP28 in a few days’ time. As the country’s clean energy powerhouse, Masdar will continue to harness the power of innovation and partnership to create a cleaner, greener tomorrow.

Eng. Saeed Ghumran Al Remeithi, Group CEO of Emirates Steel Arkan, said:

We strongly believe in the power of collaboration to achieve our ambitious decarbonization roadmap and are delighted to partner with Masdar to realize this goal, known for its successful track record in developing and implementing sustainable energy solutions in the UAE and globally. As the first steel company in the MENA region, and among the pioneers worldwide to adopt green hydrogen for sustainable steel production, this project represents a major milestone in our commitment to realize our company’s sustainability objectives.

By embracing cutting-edge technologies and fostering strategic collaborations, we are spearheading the industry's shift towards a more sustainable future, in harmony with the UAE's strategic commitment to achieving Net Zero by 2050.

Emirates Steel Arkan’s carbon intensity is independently certified to be less than half of the global steel industry average, and in 2022, it made significant strides in energy efficiency, achieving a double-digit reduction in energy intensity and a remarkable reduction in emissions and emissions intensity. This was achieved by using 80% of clean electricity, carbon capture, and scrap metal utilization. Emirates Steel Arkan is committed to reducing 40% in carbon emissions by 2030, with primary aim to achieve Net-Zero by 2050.

Masdar is dedicated to advancing the decarbonization of hard-to-abate sectors to secure global net-zero goals. For the past year, Masdar has been leading the ‘decarbonizing industry’ working group under the Sustainable Markets Initiative launched by His Majesty King Charles III of Britain.

Established in 2006, Masdar is active in more than 40 countries with a total electricity generation capacity of more than 20GW. It has invested, or committed to invest, in worldwide projects with a combined value of more than US$30 billion with ambitious growth plans to reach 100GW and 1 million tonnes of green hydrogen by 2030.