The UAE Just Bought a Foothold in the Graphene Race

The UAE has signed a deal to start producing graphene — the famously strong, conductive, two-dimensional sheet of carbon that has been perpetually five years away from its promised revolution — inside one of the world's largest gas processing plants, with one production unit already on its way.

Dana Gas PJSC, an Emirati gas company, and Levidian, a UK-based graphene technology firm, signed a memorandum of understanding on May 5, 2026 at the Make it in the Emirates industry event. The first phase targets around 15 tonnes of graphene per year by the end of 2026. By global materials standards that's modest, but the market — analysts at Mordor Intelligence estimate will grow from $2.91 billion in 2026 to more than $15 billion by 2031 — is large and growing. The companies expect to reach hundreds of tonnes per year within two years.

The structural logic is familiar from the Gulf's last big materials bet. In the 1970s and 1980s, Saudi Arabia, Qatar, and the UAE turned their natural gas and oil feedstock advantage into global dominance in fertilizers and plastics — building SABIC and Qatar Industries specifically to own the value chain rather than just export raw hydrocarbon. The same instinct is visible here: use sovereign gas infrastructure as the starting material, own the conversion step, and be positioned before the downstream market matures. The witness list — UAE Ministry of Industry and Advanced Technology, Mubadala Investment Company, Sharjah FDI Office, and UK government — reinforces that this is a sovereign economic strategy, not a routine corporate partnership.

The technology is Levidian's LOOP system, which cracks methane into two outputs: graphene and hydrogen. The LOOP Gen2 unit is roughly 20 times more productive than the first generation, designed to produce about 15 tonnes of graphene per nozzle per year. One of those units is already on its way to the UAE, according to Matthew Nix, Head of Corporate Finance at Dana Gas.

The UAE is not the first country producing graphene. China is the dominant global producer, with other significant output from the US, South Korea, Canada, and parts of Europe. But the UAE's entry point is unusual: it is using its own gas infrastructure as the feedstock, rather than importing raw material or building a separate synthesis chain. That means lower logistics costs and a direct line from an existing industrial process into an advanced material. "We very much adhere to those ISO standards," said Alex Holden, chief operating officer of Levidian, drawing a contrast with Chinese production — implying that not all graphene on the market meets the tightest international specifications. Whether graphene at $15B in projected 2031 market value is a prize worth competing for depends on which applications actually materialize.

The first deployment site is the Habshan Gas Processing Plant in Abu Dhabi, one of the world's largest gas processing complexes, handling roughly 6 billion standard cubic feet of gas per day. A LOOP pilot unit was installed there in January 2025 in partnership with Baker Hughes — the first time the technology had been deployed at an operational gas processing site. That pilot produces more than 1 tonne per annum of graphene and 1 tonne per annum of hydrogen. The Dana Gas partnership scales that to 15 tonnes per year per unit.

ADNOC's Technology team is evaluating the graphene for use in electric vehicle batteries, solar panels, concrete, tires, and polymer pipes — a standard list of potential applications that reflects graphene's breadth rather than any demonstrated breakthrough in any single one. Levidian says it works with more than 50 industrial customers and that graphene from the LOOP system has been validated in commercial products.

DNV has issued a Statement of Feasibility for the LOOP technology, and Levidian is one of four producers globally accredited as a Verified Graphene Producer by the Advanced Carbons Council.

Investment estimates reflect the pilot-to-production gap. Initial project investment is estimated at $2 million to $5 million for the first phase, with early expansion expected to range from $5 million to $50 million — a wide band that reflects the difference between a pilot line and a production facility. Energy costs add uncertainty: while energy prices have soared in recent months due to the Iran war, plans are in place to offset some of those costs with solar and renewable energy. Industry analysts say energy cost volatility is a risk that Dana Gas and Levidian are managing through renewable offsets, though the full project economics remain open.

Whether graphene finally earns its long-promised place in batteries, construction materials, or electronics remains an open question. The 15-year gap between Andre Geim and Konstantin Novoselov's Nobel Prize for isolating graphene and meaningful commercial scale has produced more cautious language in the industry than it once did. The UAE's bet is specific and concrete: using existing gas infrastructure as a feedstock, with ISO-standard accreditation as a differentiator. The first unit is already on a ship.