HOUSTON, May 7 (Reuters) - Exxon Mobil ( XOM ) has

signed a long-term agreement to supply 250,000 metric tons of

low-carbon ammonia annually to Japanese trading house Marubeni ( MARUF )

, the U.S. oil producer said on Wednesday, representing

Exxon's first signed customer agreement for its planned hydrogen

facility in Baytown, Texas.

The agreement is a step forward in Exxon's effort to build the

world's largest low-carbon hydrogen facility at its Baytown

refining and chemical complex, which has experienced delays.

Hydrogen, which can be produced from natural gas, is a clean

fuel that produces water when it is burned, while ammonia can be

used as a carrier for hydrogen, allowing it to be shipped in

liquid form. Carbon dioxide from the production of hydrogen will

be captured and stored underground, the company said.

"This is another positive step forward for our landmark

project," said Barry Engle, president of low carbon solutions at

Exxon, in a statement.

The customer agreement with Marubeni ( MARUF ) is contingent on

whether Exxon makes its final investment decision to move

forward with the Baytown hydrogen facility. Exxon said it

expects to make that decision this year, which depends on

favorable government policy and regulatory permits.

Marubeni ( MARUF ) will also take an equity stake in Exxon's Baytown

hydrogen facility, the companies said. An Exxon spokesperson

declined to specify the percentage of the stake.