Abu Dhabi energy company Masdar said Wednesday it will build a 50-megawatt wind farm in neighbouring Oman that will provide 16,000 homes with clean energy.

The $125-million project, the first large-scale wind farm in the six nations of the Gulf Cooperation Council, would be constructed in the southwestern region of Dhofar, Masdar said in a statement.

Masdar signed a joint development agreement with Oman's Rural Areas Electricity Company to build the farm, which would mitigate 110,000 tonnes of carbon dioxide yearly, it said.

Masdar is overseeing Abu Dhabi plans to generate seven percent of its energy needs from renewable sources by 2020.

It said last month it was partnering with Norwegian firms Statoil and Statkraft to build a multi-billion dollar offshore wind farm in Britain, big enough to power 410,000 homes.

The company already has a 20-percent stake in the 630-megawatt London Array project, the world's largest offshore wind farm.

Abu Dhabi is the wealthiest of the seven sheikhdoms that make up the federation of the United Arab Emirates.

It sits on proven oil reserves totalling 98.2 billion barrels -- 95 percent of the UAE's reserves, which are the world's seventh largest. It also has a large gas reserves.