By: OrePulse

Abu Dhabi's Department of Energy has signed a memorandum of understanding with three companies to assess liquefied natural gas supply for factories and commercial sites located outside the emirate's existing gas distribution networks, saying the collaboration could unlock potential investment of up to AED 1 billion.

The MoU, signed during ADIPEC 2026, involves H2G Green and its subsidiary Gas Hub United Utility, Muzn Energy, a subsidiary of Sirgas Group, and Cloud Energy. The agreement covers an assessment phase only; no specific project, supply volume or implementation timeline has been announced.

Under the planned study, the partners will examine local LNG production, transport and distribution to industrial and commercial users, along with potential supply to marine and land transport operators. The study will also look at ways to make use of the cold energy released during LNG processing, which can otherwise go unused.

The Department of Energy said it would help identify candidate sectors and sites for pilot projects to test the commercial viability of off-grid LNG supply before any broader rollout. Under the planned division of work, H2G Green will lead the commercial assessment, Gas Hub United Utility will contribute LNG technology and engineering expertise, Muzn Energy will draw on its experience supplying industrial gas locally, and Cloud Energy will support supply, transport and distribution planning.

The department framed the initiative partly in environmental terms, saying LNG supply could allow off-grid facilities to switch from higher-emission fuels to a lower-emission alternative. Muzn Energy's chief executive said LNG represents a safer alternative to synthetic natural gas systems used in parts of the UAE, arguing that natural gas is lighter than air and disperses quickly in the event of a leak, in contrast to some alternative gas systems.

The agreement follows a separate memorandum of understanding signed this month between Emarat and Al Fanar Gas Group covering UAE natural gas and CNG infrastructure, part of a broader wave of gas-sector cooperation announcements tied to ADIPEC 2026. It also comes roughly a year after AD Ports Group and Nimex Terminals signed agreements to develop LNG and LPG terminal hubs at Khalifa Port, including planned cryogenic LNG storage capacity of 400,000 cubic meters.

No further details on the timeline for completing the assessment phase were provided.