Saudi Arabia’s Aramco said on Monday it was in the process of signing a deal with Danish decarbonisation company Topsoe to build a demonstration lower-carbon hydrogen plant in the kingdom.

Aramco said the Saudi plant will use renewable electricity to produce lower-carbon hydrogen for use in power generation, with resulting carbon dioxide captured and sequestered, following a successful pilot project in Denmark.

The Saudi state oil giant said that the project, which will have a production capacity of 6 tons of hydrogen per day, would pave the way for a larger pilot plant that it said would have an annual CO2 capture capacity of 1,250 metric tons.

Aramco is also collaborating with Siemens Energy to develop a direct air capture test unit in the Saudi city of Dhahran with the capacity to removed 12 tons of CO2 from the atmosphere a year, which it expects to be completed in 2024.

It also said it had successfully piloted a new method of CO2 sequestration which involves “dissolving CO2 in water and injecting it into volcanic rocks” in Jazan, Saudi Arabia.