Major oil group acquires equity interest in blue hydrogen company

Saudi Arabia’s State oil producer Aramco has signed definitive agreements to acquire a 50% equity interest in the Jubail-based Blue Hydrogen Industrial Gases Company (BHIG), a wholly owned subsidiary of development and investment company Air Products Qudra (APQ).

The transaction, which is subject to standard closing conditions, will also include options for Aramco to offtake hydrogen and nitrogen.

Building on its efforts to develop a lower carbon business and expand its portfolio of alternative energy solutions, Aramco expects its investment in BHIG will contribute to the development of a lower-carbon hydrogen network in Saudi Arabia’s Eastern province, serving both domestic and regional customers.

Upon completion of the transaction, Aramco and APQ are expected to each own a 50% stake in BHIG.

“This investment highlights Aramco’s ambition to expand its new energies portfolio and grow its lower-carbon hydrogen business. We are delighted to partner with APQ on this journey and believe there are promising commercial opportunities for hydrogen with lower emissions. We intend to leverage our growing capabilities in carbon capture and storage (CCS), as well as our technical expertise in hydrogen, with the ambition to support the establishment of a vibrant marketplace for lower-carbon hydrogen – helping lay the foundations of a future energy system,” said Aramco strategy and corporate development executive VP Ashraf Al Ghazzawi.

“It is an honour to further extend Air Product Qudra’s strong partnership with Aramco, working to accelerate the hydrogen economy and driving the creation of the largest hydrogen network in the Middle East, which is expected to serve the refining, chemicals and petrochemicals industries. We look forward to providing our expertise in hydrogen and pipeline operations and supporting Aramco’s need for a reliable supply of lower-carbon hydrogen for domestic and regional requirements,” asserted Air Products Qudra chairperson Dr Samir J Serhan.

BHIG, which is designed to produce lower-carbon hydrogen while capturing and storing CO2, is intended to start commercial operations in coordination with Aramco’s carbon capture and storage activities.

Aramco notes that its global team is dedicated to providing crucial oil supplies to further the development of new energy technologies. The company also focuses on making its resources more dependable, more sustainable and more useful, helping to promote growth and productivity around the world.

APQ is bringing novel technologies and global capabilities to build, own and operate large-scale hydrogen, industrial gases, and energy facilities. The company works closely with industries including refineries, chemicals and petrochemicals companies, as well as with governments as a sustainability partner, supporting countries to achieve their industrial growth and sustainability targets.