The UAE possesses the fifth-largest oil reserves in the world and has been investing heavily in renewable energy generation for a number of years. Increased hydrocarbons production is being strategically targeted in the medium term to provide the revenue required for the effective diversification of both the national economy and energy mix.
Ajman, the smallest of the seven emirates, had a population of nearly 583,000 in 2024. With no proven oil reserves and minimal upstream gas activity, the bulk of its energy-related revenue comes from its expanding midstream and downstream industries and value chains. Through a range of development blueprints and roadmaps, the Ajman government is working to integrate sustainable practices into all areas of daily life and economic activity and is actively seeking private investment in the production of renewable energies and advanced technologies.
Structure & Oversight
The federal Ministry of Energy and Infrastructure oversees and regulates the national energy sector, formulating strategic initiatives and development plans. Multiple overlapping national strategies – such as the UAE Circular Economy Policy 2021-31, the National Strategy for Well-being 2031, the UAE Energy Strategy 2050 and the NetZero 2050 strategy – are being implemented to drive progress towards energy sector goals.
The Ajman Higher Committee of Energy was established in October 2024 following the issuance of Emiri Decree No. 8 of 2024 to oversee and regulate petroleum product trading activities inside the emirate. Its goals align with those of national strategies and are designed to enhance Ajman’s energy-related business ecosystems and stimulate greater inflows of private investment. Moving forward, the committee will work to regulate petroleum product trade, optimise service provision within Ajman’s energy sector, and increase safety and security measures while enforcing compliance and best practices from sector operators.
Government-Owned Entities
Government-owned entities are highly influential in the UAE energy sector. Abu Dhabi National Oil Company (ADNOC) is wholly owned by the government of Abu Dhabi, while Emirates National Oil Company (ENOC) is wholly owned by the government of Dubai. ADNOC is one of the largest energy companies in the world. Operating across the whole hydrocarbons value chain, the exploration, production, storage and distribution operations of ADNOC and ENOC stretch throughout and beyond the UAE. Additionally, publicly listed Abu Dhabi National Energy Company (TAQA) is ranked as the fifth-largest company in the UAE and has significant stakes in various ADNOC enterprises. Among the largest integrated utilities companies in the Middle East, TAQA owns power, water and oil businesses in 10 countries, and its investment in sustainability initiatives is key to driving the UAE’s strategic development. Among TAQA’s portfolio is a 43% controlling stake in the renewables arm of Masdar, another key player in the UAE energy landscape. Co-owned by TAQA, ADNOC and Mubadala Investment Company – a $302bn sovereign investment firm owned by the Abu Dhabi government – Masdar is among the fastest-growing renewable energies firms in the world and is instrumental in the UAE’s efforts to position itself at the forefront of the global energy transition.
Sharjah National Oil Company is another key player in the national energy ecosystem. Sharjah boasts the third-largest economy of the seven emirates and the largest of the five Northern Emirates – a group that includes Ajman. Meanwhile, Etihad Water and Electricity (EtihadWE), which is wholly owned by Abu Dhabi sovereign investment entity Emirates Investment Authority, is mandated to supply the Northern Emirates with electricity and desalinated water.
Strategy
The UAE Energy Strategy 2050, originally launched in 2017 and updated in July 2023, informs the development of the country’s energy sector and its changing role and influence in the national economy. One of the core goals of the original plan was to achieve a 70% reduction in greenhouse gas emissions by 2050, and the 2023 update raised the bar, targeting net-zero emissions by the strategy’s titular year.
Strategic milestones along the route to net zero include the country working to ensure clean energy accounts for 32% of power generation while tripling renewable energy capacity by 2030. Meanwhile, the country aims to increase annual oil production from its 2023 level of around 1bn barrels to around 1.5bn barrels by 2030. Production will then decline during the 2040s. The move towards net zero and the integration of renewables into the national energy mix is expected to provide multiple socio-economic benefits. It also places higher demands on the national education and training systems and establishments, which are tasked with cultivating a labour force equipped with the technical expertise to spearhead net-zero initiatives and maintain the UAE’s position among global energy leaders. During the strategy’s full term of implementation, the federal government expects to save Dh100bn ($272.2m), stimulate up to Dh200bn ($544.4m) of investment in existing and new industries and value chains, and create 50,000 new jobs.
Ajman Vision 2030, launched in 2024, is the local government’s overarching development blueprint. Sustainability is central to the strategy, with green energy production and consumption and circular economy initiatives – such as innovation in the area of waste management – at the heart of that drive. Ajman Vision 2030 is designed to align with national-level strategies, including the UAE Energy Strategy 2050; federal policies focusing on water security; circular economy and green economy development; and the UN Sustainable Development Goals.
Ajman’s government endeavours to increase public-private collaboration to develop the necessary infrastructure and ecosystems to support its vision of a sustainable future for the emirate and its inhabitants, with public-private partnerships (PPPs), joint ventures (JVs) and outsourcing agreements being harnessed to that effect. Raising private sector awareness and utilisation of sustainability-related practices is another important focus for Ajman’s government. The general public is also key to achieving the emirate’s sustainability goals, with awareness campaigns being implemented to reduce household water and energy consumption, as well as increase the adoption of sustainable community practices, such as waste sorting, walking and cycling. Indeed, delivering sustainable transportation systems is another important Ajman Vision 2030 goal, given the transport sector’s energy- and emissions-intensive nature.
Emirate-level initiatives focused on energy and climate include the Ajman Carbon-Neutral Path, which was announced in December 2023 at the UN Climate Change Conference in Dubai. The first phase strategies the formulation and implementation of short- and long-term plans regarding the decarbonisation of the emirate’s industrial and public sector operations.
Additionally, the Ajman Energy Strategy 2030 was launched in December 2024, echoing Ajman Vision 2030 directives and adapting them to the energy sector. The strategy is built upon five pillars: sustainability, transparency, safety, collaboration and innovation. Strategy goals include promoting environmental stewardship in energy management and strengthening partnerships across the energy sector. Progress towards the strategy’s goals will be measured against a range of key performance indicators, including customer satisfaction levels and in-emirate compliance with safety standards and energy policy.
Investment Regulation
Federal Decree Law No. 26 of 2020 brought significant changes to private investment law in the UAE, removing the requirement across multiple sectors that 51% of a company must be UAE-owned and allowing companies operating in those sectors to be 100% foreign-owned. It is important to note, however, that involvement in upstream oil and gas activities and utilities-related business is still restricted, and most foreign investment in those industries happens in the form of concessions and JVs. Enterprises involved in renewable energy generation, distribution and transmission can be 100% foreign owned, as can those involved in the manufacture and trade of solar and wind energy-related instruments.
Government Investment
The UAE government plans to make extensive energy-related investment to meet its climate goals while also working to spur investment in the global energy transition. A key development came in December 2023 when the government launched its climate investment fund ALTERRA, which is designed to attract higher levels of private finance into climate-related projects and to improve access to climate finance for emerging economies, particularly those in the global south. The fund is expected to mobilise up to $250bn by 2030 and launched with a $30bn investment from the UAE government and a further $6.5bn from key partners BlackRock, Brookfield and TPG, all of which are global investment and asset management firms.
In November 2024 the UAE government announced plans to invest Dh200bn ($544.4m) in its renewable energy-related 2050 climate and decarbonisation targets and initiatives. Meanwhile, ADNOC pledged $23bn to its own decarbonisation and advanced technology programmes in its bid to reach net-zero emissions by 2045, five years sooner than the national target.
Infrastructure
Ajman’s commitment to installing the infrastructure required to realise its own energy-related goals is reflected in the fact that infrastructure and environmental development has received the largest proportion of the public spending budget for at least two of the last three years. Approximately 39% of both the 2023 and 2025 budgets – which totalled Dh2.9bn ($789.4m) and Dh3.7bn ($1bn), respectively – was allocated to projects in those areas.
Ajman’s government is working to increase the role of PPPs in its infrastructure development drive, with the proliferation of waste-to-energy facilities high on the agenda. Indeed, seeking to incentivise private engagement, Ajman’s government released new PPP regulations in 2022. More broadly, the government is seeking private investment in its sustainability and energy-efficiency initiatives, particularly in the area of advanced technology development and application.
Performance & Size
The UAE’s GDP was recorded at close to Dh1.9trn ($517.2bn) in 2023, with nonoil GDP amounting to just over Dh1.4trn ($381.1bn). According to the UAE’s central statistics department, UAE Stat, mining and quarrying activities – which include crude oil and natural gas extraction and account for the designated oil component of total GDP – contributed Dh461.2bn ($125.5bn) to GDP in 2023. In 2019 mining and quarrying activities’ contribution to GDP hit Dh345.8bn ($93.1bn). The following year, performance slumped to Dh222.4bn ($60.5bn) as the economic impacts of a global pandemic set in. The subsequent phased return to economic activity brought marked growth for the sector, with contribution to GDP climbing by 65% to Dh367bn ($99.9bn) in 2021 and by 49% to Dh547bn ($148.9bn) in 2022.
While the 2023 sector contribution to GDP of Dh461.2bn ($125.5bn) represents a 15.7% slowdown, figures for the period between 2019 and 2023 exist against a backdrop of severe economic and geopolitical upheaval, first with the pandemic and then conflict in Europe and the Middle East causing significant shifts in the global energy economy. Inflated and erratic oil prices have been a notable consequence of those factors, with 2022 seeing Brent crude reach close to $101 per barrel, the highest price for the period 2014-24, before moderating to $82.5 in 2023 and just over $81 in 2024. Sector contribution to GDP came in at nearly Dh111bn ($30.2bn) for the first quarter of 2024, a year-on-year (y-o-y) reduction of 2.5% over the same period of 2023. Growth picked up in the second quarter of 2024, with sector GDP for the period of Dh121bn ($32.9bn) representing approximately 5.9% y-o-y growth.
UAE petroleum exports reached a value of $78bn in 2023, accounting for nearly 14% of total export value, according to data from the Organisation of the Petroleum Exporting Countries. Meanwhile, the contribution of electricity, gas, water supply and waste management to GDP was relatively unaffected by the pandemic, dipping from Dh61.8bn ($16.8bn) to close to Dh61.2bn ($16.7bn) in 2020. Global increases in utilities costs due to geopolitical developments did, however, register during the following years, with sector’s contribution to GDP climbing by an average of around 6% during the 2021-23 period and a total of 18.2%. Between 2022 and 2023, the value of the sector expanded from Dh76.6bn ($20.9bn) to just below Dh83.3bn ($22.7bn). In the first quarter of 2024 the sector grew by 5.2% y-o-y, with a contribution of Dh21.1bn ($5.7bn), and again in the second quarter by 5.3% with a contribution of Dh22.3bn ($6.1bn).
Petrochemicals production accounts for approximately 22% of manufacturing’s contribution to GDP annually, demonstrating the importance of oil and gas production to the diversification of industry. The UAE’s manufacturing sector expanded by 55% between 2020 and 2023 – with growth of roughly 13% between 2022 and 2023 – for a value of Dh204.8bn ($55.8bn).
Ajman has no proven oil reserves, and its involvement in natural gas extraction activities is minimal, boasting a diversified economy. The emirate’s GDP grew by 6.3% to Dh36bn ($9.8bn) in 2023. Mining and quarrying accounted for 0.2% of that total, up from 0.1% in 2022. However, it is not clear what proportion of those figures is accounted for by gas-related activity. Ajman’s lack of hydrocarbons reserves means it is more involved in midstream and downstream activities, with manufacturing accounting for the largest sector of the economy over the last four recorded years, contributing 18.8% to GDP in 2023.
Ajman hosts a number of petrochemicals, additives and lubricants manufacturers, demonstrating how the UAE’s strong upstream activities fuel resilient and diverse industries and value chains throughout the country. Utilities supply and waste management contributed 3.4% to Ajman’s GDP in both 2022 and 2023, with that sector carrying significant growth potential, given the emirate’s focus on circular economy systems such as waste management innovation.
Oil & Gas
The five largest operators in the UAE upstream oil and gas market are Total Energies SE, BP, Exxon Mobil, ENOC and ADNOC. According to Mordor Intelligence, the UAE upstream hydrocarbons market will expand at a compound annual growth rate of 5.2% during the 2025-30 period, from $9.7bn to $12.6bn. Abu Dhabi houses around 96% of the country’s proven oil reserves – which in 2023 stood at 113bn barrels – and therefore hosts the majority of major UAE hydrocarbons entities and operations.
Production stood at 3.9m barrels per day (bpd) in 2023, 2.5% lower than in 2022 but representative of 1% growth for the period between 2013 and 2023. The 2023 total accounted for 4.1% of global production that year. Although 2023 daily production was lower, it represented the country’s third-highest output over a 10-year period, with 2022 production the highest in that timeframe. Crude oil and condensates accounted for 3.3m bpd, or 83% of 2023 production, 3.4% lower than in 2022 and 3.9% of the global total. National annual oil consumption amounted to over 1.1m bpd in 2023, representing 2.7% growth and accounting for approximately 1.1% of the global total.
Gas produces fewer emissions than oil when burned as fuel – a fact that has caused the UAE and many other nations to ramp up gas production and increase its role in the national energy mix. The UAE’s production of natural gas liquids, which includes liquefied petroleum gas (LPG), ethane and naphtha separated from the production of natural gas, reached 671,000 barrels per day in 2023 – the highest production for at least 10 years and 4.9% of total global production. Meanwhile, national daily consumption of liquid fuels, including bio-gasoline, biodiesel and derivatives of natural gas and coal, was 1.14m barrels per day, which represents 2.7% annual growth, expansion of 3% in the period 2013-23 and 1.1% of total global consumption.
Ajman’s only existing interest in upstream gas activity is the Zora Gas Field, a JV offshore field with Sharjah. The site straddles the sea border between the two emirates, with Ajman occupying the role of junior partner in the JV. The UAE’s proven natural gas reserves measure around 5.9trn cu metres, the seventh-largest globally. UAE natural gas production for 2023 was 55.6bn cu metres, which was 2.5% higher than in 2022 and 1.4% of total global production, Meanwhile, national consumption outstripped production at 67bn cu metres and accounted for approximately 1.7% of global consumption.
Midstream & Downstream
UAE refining capacity stood at 1.3m bpd in 2023, an increase of 5.9% since 2013 and up 1% y-o-y. That capacity saw the country account for 1.2% of global refining capacity in 2023. In that year, the UAE utilised approximately 84% of its total refining capacity, with a throughput of close to 1.1m bpd. In addition, the country exported 7.7bn cu metres of liquefied natural gas in 2023, a level 2.9% higher than in 2022 and equal to 1.4% of the global total LNG exports. Meanwhile, LNG imports for 2023 stood at 1.1bn cu metres, 15.4% higher and around 0.4% of the total global market.
In 2019 global investment firms KKR and BlackRock purchased tariff rights for 18 ADNOC pipelines, making them the first foreign investors to purchase infrastructure assets from a Gulf national oil firm. The 750 km of infrastructure was sold for $4bn. The deal encouraged Aramco to sell a significant stake in its own pipeline infrastructure in 2021, with such deals providing a viable strategy for Gulf oil giants to generate revenue through foreign investment. However, 2024 saw KKR and Blackrock sell their 40% interest to Abu Dhabi-based investment entity Lunate for approximately $4bn, meaning that the infrastructure was once again UAE-owned as of February 2024.
Key Ajman-based players include National Ajman Petroleum Company, Gulf Petroleum and Ajman Gas Company. Those companies, among others, marry downstream production with midstream storage facilities and distribution networks and should, therefore, benefit from the Ajman government’s road infrastructure development initiatives and also the eventual construction of a proposed new seaport (see Transport & Logistics). Many of Ajman’s petroleum industries operators are headquartered in Ajman Free Zone or the Al Jurf Industrial Area, both of which lie in close proximity to Ajman Port, the emirate’s only commercial maritime port.
Gulf Petroleum operates refineries in both Ajman and neighbouring emirate of Sharjah, with its facilities producing a broad range of petrochemical products, including maleic anhydride, polyethylene terephthalate and polypropylene. Ajman Gas opened for business in 2020 in the Al Jurf Industrial Area. The company launched with the capacity to meet Ajman’s daily requirement of bottled LPG. Its facility spans 50,000 sq-metres with a storage capacity of 1.6m litres and a daily bottling capacity of 40,000 kg.
Electricity
In 2023 the UAE generated a total of 165 TWh of electricity, which represents 7.6% annual growth and an increase of 4.1% from 2013. Natural gas provided close to 119 TWh of electricity, down from 125.5 TWh in 2022, while nuclear and renewable energy sources provided approximately 32.3 TWh and 13.8 TWh in 2023, up from 20.1 TWh and 7.8 TWh, respectively, the previous year.
With power consumption in the Northern Emirates showing marked increases in recent years, EtihadWE has opted to no longer focus on generation and to instead offtake electricity from the country’s larger suppliers – most notably Abu Dhabi’s Emirates Water and Electricity Company – to meet rising demand in the region. EtihadWE’s Ajman and Ras al Khaimah plants have, therefore, been out of service since 2021.
EtihadWE now focuses on service provision and has implemented multiple recent initiatives to promote energy efficiency in the Northern Emirates. In October 2024 the company announced that it had successfully installed smart metres for 100% of its customer base, with 40% of the devices integrated into the company’s smart systems at that time, and full integration expected in 2025. During the GITEX Global tech show in Dubai in October 2024, EtihadWE signed a partnership with Systems Limited MEA – Techvista that will see data- and AI-driven advanced technologies more deeply integrated into EtihadWE operations and service provision. In addition, EtihadWE has partnered with Khazna Data Centres to provide power for the latter’s new facility in Ajman, which is set to become the UAE’s largest data centre upon its anticipated launch in late 2025 (see Construction & Real Estate).
Renewables
Of the 13.8 TWh total of electricity generated through renewable energy sources in 2023, wind power accounted for 0.1 TWh, up 100% on 2022; solar provided 13.7 TWh, an increase of 77.6%; and other sources of renewable energies contributed less than 0.05 TWh. Although comparatively low, this represented an increase of 159.6%.
Meanwhile, in 2024 solar power saw the lion’s share of the UAE’s renewable energies investment due to predictably high levels of sunshine in the region. The largest sites as of 2024 were in Al Dhafra, Abu Dhabi, – which is undergoing capacity expansion works that will make it the world’s largest solar farm – as well as Al Ain, Abu Dhabi; and Saih Al Dahal, Dubai.
Wind power was added to the national energy mix in 2023. Masdar launching four sites throughout the year with a total capacity of 103.5 megawatts. Three of the sites are situated in Abu Dhabi, with the other in the northern emirate of Fujairah. The sites are capable of producing enough power for 23,000 homes per year while displacing 120,000 tonnes of CO₂. The government has stated its desire to erect more wind farms in the north of the country, but the region’s mountainous terrain presents the need for additional infrastructure to enable the construction of the sites. Ajman, meanwhile, has seen the construction of two waste-to-energy plants in recent years, with private and foreign direct investment being sought in the development of other such facilities.
Outlook
The UAE is investing heavily in the modernisation of its energy sector, with the country’s largest hydrocarbons entities placing significant finance into capacity expansion and their concurrent transition to cleaner fuels and decarbonisation. In spite of foreign ownership restrictions, private investment in the country’s hydrocarbon activities can still offer significant returns for investors in possession of sufficient capital in light of the scale of the operations and entities in question. Furthermore, with full foreign ownership permitted across the renewable energy segment, Ajman’s focus on sustainability provides significant opportunities for involvement in renewable energy production, circular economy practices and the development of related advanced technologies.
