UAE, US Launch Historic $440B Clean Energy Partnership
The UAE and United States have joined forces in a game-changing partnership. Both countries will invest $440 billion in the energy sector by 2035. This partnership stands out as one of the biggest cross-border energy investments in recent memory. UAE’s current $70 billion investment in the U.S. energy sector is expected to grow dramatically.
The United States will pour $60 billion into UAE’s energy projects through this two-way partnership. At the heart of this collaboration lies the UAE-U.S. Partnership for Accelerating Clean Energy (PACE). This initiative will channel $100 billion to set up 100GW of clean energy by 2035. The partnership reaches beyond traditional energy into cutting-edge fields. Both countries will work together on artificial intelligence, semiconductors, and nuclear energy projects. They have specifically agreed to build small modular reactors in the United States.
UAE and US announce $440B energy investment plan by 2035
Image Source: ADNOC
Sultan al-Jaber, ADNOC’s CEO, announced a massive joint investment plan between UAE and United States. The plan commits AED 1615.65 billion ($440 billion) to the energy sector through 2035. UAE’s current investments in the U.S. energy sector stand at AED 257.04 billion ($70 billion) in enterprise value.
American energy firms will pour approximately AED 220.32 billion ($60 billion) into UAE-based energy projects. Officials at the UAE-US business dialog emphasized that this investment showcases the growing partnership between both nations to advance clean energy, technology, and infrastructure development.
The UAE-US Partnership for Accelerating Clean Energy (PACE) serves as the life-blood of this collaboration. Launched in November 2022, PACE wants to mobilize AED 367.19 billion ($100 billion) in financing and deploy 100 gigawatts of clean energy by 2035. Both countries unveiled the first wave of public-private investments into PACE in January 2023. The original envelope of AED 73.44 billion ($20 billion) focuses on developing 15 gigawatts of clean energy projects in the United States.
Major American energy companies have joined this collaborative effort actively. ExxonMobil, Occidental Petroleum, and EOG Resources have partnered with ADNOC to expand oil and natural gas production, valued at AED 220.32 billion ($60 billion). Holtec International and IHC Industrial Holding Company’s cooperation agreement will build SMR-300 small modular reactors, starting at Michigan’s Palisades site. The agreement commits AED 36.72 billion ($10 billion) initially and AED 73.44 billion ($20 billion) for fleet projects.
This strategic investment framework prioritizes four key areas: clean energy innovation and supply chains, carbon and methane management, nuclear energy development, and industrial and transport decarbonization. Both nations’ coordinated efforts will strengthen global energy security, affordability, and accessibility while creating economic opportunities and skilled jobs in both countries.
Major players drive cross-border energy collaboration
Image Source: ADNOC
UAE and US companies are leading a historic energy partnership through major investments in both countries. ADNOC‘s international investment wing, XRG, has become a major force by investing in NextDecade’s Rio Grande LNG and ExxonMobil’s Baytown Hydrogen project in Texas. XRG plans to grow into a AED 293.76 billion global venture that focuses on energy transition and state-of-the-art technologies.
A massive AED 91.80 billion joint investment has been created by ADQ and Energy Capital Partners. Their goal is to build energy infrastructure that supports AI’s growing power needs. This partnership shows how energy collaboration now extends beyond traditional areas into state-of-the-art technology uses.
The UAE’s premier alternative energy company, Masdar, now owns 50% of US-based Terra-Gen. This investment helps stimulate economic growth across 30 power sites, mainly in California and Texas. The Emirates Nuclear Energy Corporation and TerraPower have also signed an agreement to explore Natrium1 nuclear technology commercialization.
ADNOC bought a 35% stake in ExxonMobil’s planned low-carbon hydrogen and ammonia production facility in Baytown, Texas in September 2024. This facility plans to produce about 900,000 tons of low-carbon ammonia yearly to help hard-to-abate sectors switch to cleaner fuels.
ExxonMobil, Occidental Petroleum, and EOG Resources have joined forces with ADNOC in AED 220.32 billion worth of oil and natural gas production projects. Emirates Global Aluminum plans to invest AED 14.69 billion in a primary aluminum smelter project in Oklahoma.
Mubadala Energy has stepped into the US market by acquiring 24.1% of Kimmeridge’s SoTex HoldCo. This smart investment opens access to Texas gas production and an LNG export project in Louisiana, with final investment decision expected later this year.
ALTÉRRA has launched as the world’s largest private investor for energy and sustainability projects in emerging markets, backed strongly by the US private sector.
Strategic goals align with AI and energy security demands
Image Source: TRENDS Research & Advisory
The UAE and US have ambitious plans that go beyond regular energy partnerships. These plans address the rapid growth in power needs that AI systems require. By 2030, data centers worldwide will need twice as much electricity – about 945 terawatt-hours. This is a big deal as it means that the power usage will exceed Japan’s current total electricity consumption. Both countries know they must build reliable infrastructure to support this digital shift.
The UAE has become a global AI leader and uses this technology to broaden its economy beyond oil. The two countries created the “US-UAE AI Acceleration Partnership” to boost cooperation in key technologies. A massive 1GW AI data center stands as part of Abu Dhabi’s planned 5GW UAE-US artificial intelligence technology hub.
The UAE’s sovereign wealth fund ADQ collaborates with US firm Energy Capital Partners on a AED 91.80 billion US-focused investment program. This program targets energy infrastructure and data centers. The facility will cover 10 square miles and become the largest AI campus outside the United States once complete.
The partnership goes beyond AI to address energy security through smart investments in technology. PACE has four main pillars: clean energy innovation and deployment, carbon and methane management, nuclear energy, and industrial and transport decarbonization. Holtec International and IHC Industrial Holding Company pledged AED 36.72 billion for small modular reactors, plus AED 73.44 billion for fleet projects.
These investments create many jobs. The global energy sector added 2.5 million jobs in 2023, with clean energy providing 1.5 million positions. Renewable energy jobs reached 16.2 million globally in 2023, showing an 18% increase from the previous year. Through strategic investments, both nations want to make energy more affordable, secure, and accessible while creating economic opportunities.
The historic $440 billion UAE-US energy partnership marks a defining moment in global energy cooperation. This initiative goes way beyond the reach and influence of traditional energy, and covers state-of-the-art clean energy, carbon management, nuclear development, and industrial decarbonization. Both countries will benefit by a lot from working together as UAE investments in US energy grow beyond the current $70 billion valuation.
Major companies showed their dedication through substantial investments. ADNOC’s international arm XRG emerged as a major force through strategic stakes in American energy projects. American giants like ExxonMobil collaborated with UAE entities on expanded production worth $60 billion. The ADQ-Energy Capital Partners joint investment targets the growing power needs of artificial intelligence infrastructure.
The partnership’s bold goals line up with both countries’ strategic interests. We wanted to deploy 100GW of clean energy by 2035 through the PACE initiative. This addresses urgent energy security concerns and creates economic opportunities. The collaboration also recognizes the rapid growth in power needs driven by technological advancement, especially when you have AI development.
This partnership carries immense significance. It shows how countries working together can accelerate energy transition while ensuring energy security. The joint focus on emerging technologies like small modular reactors and AI data centers makes both nations pioneers in innovation. We have a long way to go, but we can build on this progress in implementing such a massive initiative. The groundwork laid through these agreements provides a reliable framework to progress through 2035 and beyond.
