NG Oil & Gas MENA

RBG Middle East Reinforces its Commitment to the Region

Mon, 10 Jan 2011 10:48:00 +0000

RBG, the leading provider of fabric maintenance, construction support and related services to the international oil, gas and petrochemical industries, has reinforced its commitment to the region through the re-launch of the company as RBG Middle East.

Formerly trading as SRQ, the company has now taken full control of its business and is in the process of fuelling expansion throughout the Middle East (‘ME') region after a very successful 2010.

As the industry matures and activity continues to increase the shutdown/turnaround and maintenance market has become a focus. With its specialist suite of services, which includes specialist cleaning, mechanical and inspection, RBG Middle East is ideally placed to react to the industry's ever increasing demand.

Graeme Shirreffs, Director at RBG Middle East, said: "Ensuring that equipment and facilities are operating at optimal efficiency is vital as activity and demand picks up. For RBG, this is an excellent position to be in, as the company specialises in maintenance and service support."

2010 saw a number of high profile contract wins across the region including a high pressure water jetting contract with Occidental in Oman and several contract awards in Qatar with Qatargas, Oryx, QChem and Rasgas.

Shirreffs continued: "2010 was a strong year for RBG in the ME following increased awareness of the company's portfolio of services throughout the region. Following excellent growth in the Qatar market RBG Middle East is looking to enhance its footprint and make its mark on the wider ME region. It is an exciting time for the company and we are looking forward to a prosperous 2011."

About RBG

RBG was formed in 2005 through the merger of Mach-ten, MacGregor Energy Services and Rigblast Group. Headquartered in Aberdeen, UK, we operate in the UK and internationally and employ over 4,500 people. Our facilities and offices are located in principal areas of energy exploration and production activity, including Azerbaijan, Italy, Kazakhstan, Qatar, Trinidad & Tobago, the UK and the USA. For more information, please visit www.rbg-group.com.

Putting clients back in control - E&P | Oil & Gas project uncertainty leads to increased risk that can | Life Cycle Integrity Management - Pipelining | Takreer strikes deal for oil refinery

Total Plans Petrochemical Plant in Qatar

Mon, 13 Dec 2010 14:33:00 +0000

Total, the French oil giant has entered into talks with Qatar regarding a petrochemical plant a spokesman for Total said last week.

The talks are in relation to a petrochemical complex that Qatar is planning to build in Ras Laffan, where it has also been working with ExxonMobil. The project was initially valued at US$6 billion.

"We are in discussions with Qatar about the project. But they are still in a very early stage," a Total spokesman said.

According to Reuters, two industry sources have claimed that Exxon Mobil has pulled out of the Ras Laffan project. But the company has denied the reports and repeated its statement from August when it said it was still working with Qatar. However, Total Petrochemicals' senior vice president for Asia and the Middle East, Graeme Burnett, was quoted as saying in ICIS news that Exxon Mobil, Total's US rival, has exited the project. If Exxon does pull out of the project, it will be the third time a US company has pulled out of an energy project in the Gulf region this year.

"ExxonMobil has exited the cracker project in Qatar, and we've always told media that we are interested in doing another project in Qatar," he was quoted as saying in the article published last week.

The proposed complex in Ras Laffan includes a 1.6 million tonnes per year (tpy) steam cracker and associated units including two 650 tpy polyethylene plants and a 700 tpy ethylene glycol facility.

Related articles:

Total information integration or how to lubricate your process | World-class procurement and the National Oil Company opportunity | Consolidating HSE systems - IT & Communications | Corrosion of pipeline components - Middle East Oil and Gas

European Debt Causes Oil Prices Down

Thu, 09 Dec 2010 09:43:00 +0000

Oil dropped below $90 a barrel this week due to Europe's debt crisis hurting fuel consumption, and after an industry report showed US gasoline supplies surged the most since January.

Futures fell a second day as traders secured profits from a rally to $90.76 a barrel, the highest in 26 months, according to Bloomberg. The dollar strengthened after European ministers ruled out immediate aid for debt ridden Portugal and Spain, dulling investor appetite for commodities. The American Petroleum Institute said gasoline stockpiles increased 4.8 million barrels last week.

Crude, due for delivery in January dropped by as much as 1.2 percent, to $87.61 a barrel in electronic trading on the New York Mercantile Exchange. The contract was at $88.37 at 1:32 p.m. GMT. Brent crude for next month settlement fell as much as $1.12, or 1.2 percent, to $90.27 a barrel on the London based ICE Futures Europe exchange.

Christopher Bellew, senior broker at Bache Commodities Ltd in London said: "Oil is facing contradictory pressures. On the one hand it's being pumped up by Chinese demand and colder weather, while on the other relatively high supplies and economic anxieties are dragging it down."

Oil has risen 11 percent in 2010, on the back of a soaring market of 78 percent in 2009 and a 100 percent increase in 1999.

Oil's rally is unlikely to coax OPEC into raising production quotas at a meeting this week in Ecuador, as group members consider the global economic recovery strong enough to withstand price gains, according to a Bloomberg News survey.

Related articles:

Issue 1 - NG Oil & Gas MENA | Harnessing the power of Parker - Exploration | Blog Oil & Gas Industry - Oil & Gas Publication Middle East

Saudi Arabia, Kuwait Aim to Increase Natural Gas Production

Thu, 02 Dec 2010 11:46:00 +0000

Saudi Arabia and Kuwait aim to reduce the amount of oil it uses to generate power by utilizing natural gas instead, according to two nations' state oil companies.

"We are picking up gas exploration," Ahmad Al Sa'adi, vice president of gas operations at Saudi Aramco, said today at a conference in Doha, Qatar. "Any liquid fuel we are burning comes at the expense of our exports."

Saudi Arabia and Kuwait are currently both hampered in producing natural gas by the Organization of Petroleum Exporting Countries limits the amount of gas that can be extracted. Any gas that is currently collected is as a by-product of oil exploration.

Kuwait intends to seek gas fields within its borders and also import. Currently Kuwait uses an average of 200,000 to 300,000 barrels of oil and refined products each day to generate power.

"Our plan is to use less oil than gas," he said. "If worst comes to worst, we would continue to use the more expensive fuel," said Farouq al Zanki, chief executive officer, Kuwait Petroleum Corp at a gas supply conference in Qatar.

Saudi Arabia's domestic oil and gas use is growing faster than its economy, according to Bloomberg. Oil and gas is rising at an average of 5.9 percent annually in the past five years, the kingdom's central bank governor Muhammad al Jasser said in September. The Saudi economy, excluding oil, may expand 4.5 percent in 2010 according to the International Monetary Fund, compared with 3.3 percent in 2009.

"What is really making the difference is that domestic demand is growing," Al Sa'adi said.

Kuwait is currently producing 2.2 billion cubic feet of gas a day, which is one billion cubic feet of gas a day less than it needs, according to Sami al Rushaid, Kuwait Oil Co chairman. Kuwait currently pumps three million barrels a day.

Related articles:

Does the economy rely too much on Saudi Arabian oil? | Saudi Aramco | Oil and Gas | Will Saudi turn to green energy? | Saudi oil production usage

Leading Figures Discuss Oil Uncertainty in MENA

Tue, 23 Nov 2010 10:30:00 +0000

With territorial ownership being put forward in all four corners of the globe, including Great Britain's claim to the Falkland Islands and more recently Japan's claim to the Kuril Islands, Great British and Argentinean armed forces are on standby for inevitable confrontation. Argentina dispute Great Britain's claim to the Islands they call Islas Malvinas and Russia dispute Japan's claim to the Kuril Islands.

In November of 2009 the Japanese government reiterated the accusation that "the Russian Federation is illegally occupying four northern islands."

The Russian Foreign Ministry responded by labelling a document issued by Tokyo as "unacceptable." The document identifying the alleged "illegal occupation by Russia" of the Kuril Islands, stating: "We consider it necessary to stress that the Southern Kuril Islands are an inseparable part of the Russian Federation territory on legal grounds based on the WW2 results in accordance with the legally binding agreements and treaties between the ally states, as well as the UN Charter that was ratified by Japan."

Last month then-Japanese Foreign Minister Katsuya Okada spoke of the Kurils being "illegally occupied by Russia."

In light of this instability major oil giants are sending their top decision makers which includes, Eon's John Roper, Head of Middle East, Jura Energy's Abdul Ghafoor Anjum, Chief Geologist and Shells, Martjin Van Lieshout, Manager of Production to the Oil & Gas Summit in Dubai on the 12th - 14th April. Here topics from upstream solutions to downstream management will be discussed along with the current territorial issues facing many oil chasing countries.

Japan is concerned by the holding of Russia's Vostok-2010 military drills on Iturup Island, the largest of the disputed South Kuril Islands, Japan's Kyodo news agency said.

A British company has begun drilling for oil in the territorial waters of the Falkland Islands, despite strong opposition from Argentina. Argentina claims sovereignty and has imposed shipping restrictions. UK Defence Minister Bill Rammell said the government had a "legitimate right" to build an oil industry in its waters.

Before the financial crisis gripped the globe in late 2007, countries that had disputed territorial claims to land off their regional borders tentatively agreed to disagree. It's only now, in recent months, with fears of a double dip recession panicking nations into looking further afield, to find new ways to kick start their own flagging economies, have opposing governments made their territorial claims louder and more aggressive.

At the Oil & Gas Summit government officials along with major players from the world biggest energy companies (as stated above) and industry experts will negotiate cost effective, safe and market leading solutions to the successful extraction of sought after, hotly disputed and depleting natural resources their country may possibly own.

Related articles:

World-class procurement and the National Oil Company opportunity | Safety success - Health & Safety | Real world wireless - Refining - NG Oil & Gas MENA

Middle East Oil News Round-Up

Fri, 12 Nov 2010 09:51:00 +0000

Oil Company Spending Highest Since 2008

In a report by Reuters, oil and natural gas companies are likely to eclipse $380 billion in investment in production projects. A consultant for Wood Mackenzie suggested that this increase in spending was driven by spending on drilling on shale gas in the US.

The anticipated rises will are estimated at 5.3 percent, an increase from 2009 of $19 billion.

"The most spectacular recovery has been in the US, where total spend should return close to peak levels by 2011," the consultant said. "This is primarily due to restored confidence and an impressive renewal of activity in unconventional resources, particularly shale gas."

"Record growth in capital spending is already under way in Australia, where new project approvals and major gas developments will see capital expenditure grow three-fold by 2013," Wood Mackenzie said. "In Iraq, upstream investment is likely to climb rapidly to $10bn in the next three years."

Major oil and gas companies have been utilizing the US with new, unconventional methods of drilling for shale gas, primarily drilling horizontally for thousands of feet and fracturing rock with water, sand and chemicals.

One of the beneficiaries to this new expertise in shale extraction is Chevron Corp, who agreed this week to purchase Atlas Energy for $3.2 billion - a strategic move which enables the second-largest US oil company access to the Marcellus Shale formation in Pennsylvania.

Refiners Increase Production in Middle East

Prices for Middle-Eastern crude rose for a second day as demand increased for middle distillates above benchmarks.

Murban, produced by Abu Dhabi National Oil Co, for January loading rose 1 cent to a premium of 21 cents a barrel to its official selling price, according to data compiled by Bloomberg. Qatar Marine rose 3 cents to a premium of 18 cents to its official price, according to Bloomberg.

Oman crude for immediate loading gained 83 cents, or 1 percent, to $86.90 a barrel, according to data compiled by Bloomberg. That's the highest since May 4 when prices reached $87.40, the most this year. Dubai for January rose 83 cents, or 1 percent, to $86.61. Murban increased 1 percent to $88.10.

Relevant articles:

Saudi Aramco | Iraq oil reserves rank third worldwide, overtake Iran | Latest News | Corrosion of pipeline components

Saudi Aramco Hikes December Crude Prices to Asia

Fri, 05 Nov 2010 09:31:00 +0000

Saudi Aramco, the world's largest state-owned oil company, has hiked its prices on crude destined for Asia for December. The increase is the third rise in as many months for the oil giant.

Arab Super Light crude saw the biggest increase, with Saudi Aramco raising it by $1.45 a barrel to a $3.35 premium over the average of Oman and Dubai grades.

The price increases in Asia weren't an indicative trend in the west, as light and medium crude exported to the US lowered by 5 cents a barrel in December. The total increase of Aramco crude exports to the US dropped from 20 percent in 2008 to 14 percent this year. The surplus crude was made up in China, which bought on average more than 1 million barrels of Saudi crude a day last year, an increase on the previous year.

Saudi Arabia was the fourth-biggest exporter of crude to the US last year, dropping from second place in 2008, data from the US Energy Information Administration show. Canada, Mexico and Venezuela all shipped more crude to the US, the data show.

The price of Extra Light and Arab Heavy crudes remained unchanged.

According to Bloomberg, Crude oil for December delivery rose 0.6 percent on the New York Mercantile Exchange during October to $81.43 a barrel at the close of trading on 29 October. Saudi Oil Minister Ali al-Naimi said this week that crude-importing countries are happy with prices between $70 and $90 a barrel, a broader range than the $70-to-$80 spread that he said on March 30 was "as close to perfect as possible."

As well as price cuts to the US, Aramco announced cut prices to all crude types heading to the Mediterranean, and on most oil types to Northwest Europe.

Related articles:

Did Aramco cover up an oil spill? | Aramco's Khursaniyah ready for production | Career ladder - Lead Features | Future vision - Refining

Iran Offshore Crude Storage Dips by 4 Million Barrels

Mon, 25 Oct 2010 10:10:00 +0100

Iranian crude oil stored at sea has seen a significant decrease by as much as 4 million barrels, as demand from the east continues to increase.

This is in stark contrast to trade with the west, which, in light of tough sanctions means western countries shun Iranian crude, as it makes financing oil deals with the OPEC member is increasingly challenging.

"The Eastern buyers have to be taking more of it. You can't flood the European market with it because there are so many people who can't take it," said a trader with a European oil company.

According to Reuters, only large European oil companies remain major buyers of the Iranian crude oil. These include Royal Dutch Shell, Total and Eni.

"Right now, we see about 550,000 barrels per day of Iranian crude coming to Europe," a second European trader said. "October is slightly lower than September, which was lower than August."

The crude oil shortage is also due, in part, to other Asian refiners stock up on differentials for colder climates, during winter.

"I think with December sour crude premiums picking up ... refiners are turning to Iran," a Singapore-based trader for a Western oil company, according to Reuters.
The Islamic Republic was storing as much as 16 million barrels of crude oil on tankers offshore, down from 20 million last month, traders and shipping sources said.

"In October, two (very large crude carriers) VLCCs of Iranian crude have discharged from floating storage for the East. This is more than we usually see,
Iran, OPEC's second-biggest oil producer, exports roughly 2 million barrels of oil a day, mainly to Asia.

Related articles:

Iraq oil reserves rank third worldwide, overtake Iran | Iran's worldwide crude oil exports | Oil companies cut shipments to Iran

Iraq oil reserves rank third worldwide, overtake Iran

Wed, 06 Oct 2010 09:39:00 +0100

Iraq has leapfrogged Iran after a recalculation of its oil reserves according to a new report. The news will come as a boost to the war-battered country as it tries to rebuild its crude-dependent economy.

Iraq depends on crude oil exports for 95 percent of government revenue, and is trying to upgrade outdated infrastructure and spur economic growth after being crippled by decades of conflict and sanctions.

Oil Minister Hussein al-Shahristani confirmed at a news conference that "Iraq's oil reserves which are extractable are 143.1 billion barrels." If these figures are accurate it would represent a 24 percent increase over the existing figure, which was thought to be 115 billion barrels. Shahristani also confirmed that Iraq had a further 33.486 billion barrels that are non-extractable. The new estimates mean Iraq overtakes Iran into third place worldwide, but is still behind Saudi Arabia and Venezuela in oil reserves.

With the new estimates, Iraq now has 66 oilfields, including seven supergiant fields. Demographically the majority of these fields are located in the south (71 percent), with 20 percent in the Northern regions and nine percent in the centre.

Shahristani said known reserves at the West Qurna supergiant oilfield now totalled 43 billion barrels, making it the second biggest oilfield in the world.

He said details of the new figures would be passed on to the Organisation of Petroleum Exporting Countries later on Monday, but some analysts raised concerns over the newly reported levels.

OPEC unsure of total increase

"In the longer term, bigger reserves mean a bigger production quota since reserves are one of the factors used to calculate the (OPEC) members' relative production quotas," Ruba Husari, the founder and editor of iraqoilforum.com, told AFP.
"But the announcement is bound to raise questions within OPEC as to the methodology used to confirm the new reserves."

Husari said the announcement "came as a surprise because there has been little activity to justify it and whatever is currently being carried out at some of the fields in southern Iraq, such as 3-D seismic surveys, is still in the early stages."

Energy experts however have expected the figures to rise in Iraq, due mainly to the stagnant exploration during Saddam Hussein's leadership.

The increase in reserves puts pressure on Iraqi export infrastructure. Last month Iraq signed with Turkey to extend its use of the Ceyhan pipeline for a further 15 years, and also reached an agreement with Syria to build two pipelines connecting it to Mediterranean sea ports. The moves come in line with Iraqi estimates to export 10 million bpd within the next decade (current estimates are currently 2.4 million bpd), although commentators have suggested these increased exports are likely unachievable.

Related articles:

Turkey ensures Iraq over oil and gas export security | UAE to invest in Iraq oil and gas? | Untapped potential - Lead Features | Eastern promise - Drilling

Seaswarm: A robot to clean up oil spills?

Wed, 29 Sep 2010 08:53:00 +0100

Seaswarm is pretty similar to Ocean Therapy Solutions' device which filters crude oil from sea water, because it is designed to specifically siphon crude oil from sea water at a spill site. Ocean Therapy Solutions' largest device could siphon up to 200 gallons a minute, but Seaswarm claim that as a collective group, their machines can work together to clean even larger areas of ocean.

The machines are around five metres long and two metres wide, and resemble something similar in appearance to a treadmill. Costing $20,000, each machine requires no human intervention and can work independently, and according to Seaswarm can locate a spill and transmit its location to other machines using WiFi and GPS. Collectively the machines will work through polluted ocean, and collect all the oil.
The machines are able to do this by soaking up oil with the tread as it skims over the surface, which uses nanotechnology which attracts oil and repels water. Once the tread has collected its fill - around 20 times its own weight in oil - it will deposit the oil collected in the ocean in a bag which can be collected and reused.

The robots are friendly to the environment too; they only require 100 watts of power, the equivalent of a bright light bulb. They also work autonomously and don't need to return to the shore for constant maintenance.

Assaf Biderman, who supervised this project at MIT says, "Because it (conveyor belt) adheres to the surface of the water, it cannot capsize. So it can withstand quite severe weather. Imagine this like a leaf that lands on the surface of the water and moves with the waves and the currents and cannot be flipped over."

The team at MIT have calculated that if the Seaswarm robots were deployed during the current Gulf of Mexico oil spill, the costs of collecting the surface oil would have been significantly reduced. Biderman claimed that 10,000 Seaswarm robots could have cleaned up the oil in two months and the cost of the whole operation would have amounted to $100 million to $200 million.

"Ideally, when spillage happens, the best thing to do is to contain it right where the spillage occurs. But quite often the oil goes out of containment, and this is where this technology would be most effective," he said.

Related articles:

Would an oil spill in the Middle Eastern Gulf be easier to contain | Crescent Gulf oil spill comments | Did Aramco cover up an oil spill?

Turkey ensures Iraq over oil and gas export security

Fri, 24 Sep 2010 16:16:00 +0100

With its geographical context leaving it straddling Asia and Europe, Turkey makes no bones about vying to become a regional energy hub for the often politically sensitive and developing nations surrounding it. With that in mind, Turkey's Energy Minister, Taner Yildiz, released a statement last Sunday explaining that he had given Iraqi Oil Minister, Hussein al-Shahristani, reassurances that Turkey would not be allowing any exports of Iraqi Kurdistan-produced oil or gas through its midstream infrastructure without the prior blessing of Iraq's central government.

Speaking at a joint press conference, al-Shahristani said that hydrocarbons "exported outside of the Iraqi government framework won't be recognized, with Yildiz adding that: "any gas produced in Iraq is the property of all Iraqis. We aren't a part of any of the agreements outside the Iraqi central government."

This comes off the back of the ongoing dispute between the Iraqi government and the autonomous Kurdistan Regional Government (KRG) about the ownership and power over inherent natural resources. With the KRG having successfully attracted small and mid-size IOCs to explore its acreage under production-sharing agreements - and thus believing they have the sole ownership to resources - the Iraqi government is claiming its sole right to sign upstream contracts with companies, refusing to recognize the production-sharing agreement framework as Iraq uses technical service contracts.

Unfortunately, the KRG's landlocked status means that the region is ultimately at the mercy of Turkey to allow transit for any of its exports. For geographical and political reasons, Syria and Iran are out of the picture, which leaves the only foreseeable solution in the hands of the KRG and the central government of Iraq to conjure up a sympathetic deal for both parties.

Talks on the subject have already prevailed following the March general election, where the Kurdish faction - speaking very much in unity on the national level - made sure to highlight the importance of a coalition if any form of safeguarding of deals to gain maximum autonomy is to occur. Of course, controlling its own hydrocarbon revenue would add a vital string to the nation's bow, but with other controversial issues also on the agenda, including the status of the oil hub and various border areas where Kurds are the majority population - but don't belong to any of the autonomous region's three governorates.

And with strong popular Kurdish nationalism demanding no leeway on any of the issues raised, the Kurdish parties are finding it hard to compromise, while resurgent Iraqi nationalism among the Shi'a and Sunni population is making the strongest political factions in Iraq similarly disinclined.

To add further friction to the situation, in August, suspected Kurdish rebels blew up an Iraqi-Turkish oil pipeline and an Iran-Turkey gas pipeline in separate attacks, cutting supplies for several days. And with Yildiz worried that the sabotage could threaten the security of future projects, ensuring relationships with Turkey's neighbours are maintained and the nation looks as attractive as possible has never been more important.

Related articles:

Eastern promise - Drilling | Counting the cost - Health & Safety & Offshore | From rig to refinery to distribution: enterprise mobility | Rising star - Lead Features

Oil supply, demand disconnecting from price

Thu, 16 Sep 2010 10:53:00 +0100

The International Energy Agency's chief economist has confirmed that the supply of oil and demand are disconnecting from price signals amid a shift in consumption toward transportation fuels and emerging markets.

Fatih Birol, the International Energy Agency's chief economist, explained at the World Energy Congress in Montreal that high prices are much more likely than lower values to encourage consumers to lessen their fuel usage and prompt investors to make decisions affecting supply.

"This is crucial to understanding oil markets in the years to come. You need higher prices to slow down the oil demand growth when you compare the past couple of decades," Fatih Birol said.

Birol outlined a giant shift in oil usage, with the trend swinging in the last five years - when oil was utilized for industry, home heating and electricity generation - in favour of transportation sector, including cars, trucks and jets.

Birol said: "Even though the prices go up, you do not have readily available alternatives to switch fuels for vehicles. In terms of electricity generation, if the oil prices go up, one would go to gas, nuclear or coal in the past. In the transportation sector, it's fairly rigid."

Higher prices are also needed to stimulate investment in the market, he said.

The biggest demand is driven by emerging markets in Asia and the Middle East, in countries like China and India, where fuels are subsidized.

"This means that consumers aren't subject to price signals that affect usage until costs rise high enough to put the subsidies themselves under scrutiny," according to Arabian Business.

Related articles:

OPEC reduce demand for their crude due to external supply | An international engineering and consultancy company with all | What are 'Streamlined Procurement Processes' | The impact of bitumen-derived feeds on the FCC unit

Arab region set to take over petrochemicals?

Thu, 09 Sep 2010 15:21:00 +0100

Phenomenal investments by the UAE, Saudi Arabia and other major Arab hydrocarbon producers into the petrochemical industry will allow them to control nearly a quarter of the world's total petrochemical output, according to a recent official report.

At the wrap-up of 2007, the Arab nations produced roughly 8.5 percent of the global petrochemical output - that level is projected to leap in the next two years as a result of colossal new projects being constructed in the region, mainly in Saudi Arabia, which could become the world's top producer of such substances, said the report by the 10-nation Organisation of Arab Petroleum Exporting Countries (OAPEC).

Based in Kuwait, OAPEC said in the report that most regional nations have embarked on mammoth petrochemical projects as part of economic diversification programmes, potentially pushing Western petrochemical producers to suspend planned expansions given the Arab region's huge gas reserves. "As a result of this sharp increase in the region's petrochemical output capacity," said the report, "producers and investors in North America and West Europe are expected to face obstacles in their plans to expand their production capacity, prompting them to suspend expansion projects, leading to removal of bottlenecks."

"The petrochemical industry in the Arab region has been passing through an unprecedented boom reminiscent of the boom in the late 1970s," the report continued. "This is due to several factors including the availability of massive gas resources, a large consuming market, a strategic location between eastern and western markets and the intensifying efforts undertaken by regional governments to develop non-oil industries and diversify their economies."

Related articles:

The ideal reservoir model is now possible using a fully integrated | An international engineering and consultancy company with all | A new chapter - Health & Safety | Untapped potential - Lead Features

OPEC reduce demand for their crude due to external supply

Thu, 09 Sep 2010 14:32:00 +0100

Organization of Petroleum Exporting Countries (OPEC) has reduced its outlook supply for 2011 due to increased external production from other outside groups, according to the most recent OPEC monthly report.

In the report, OPEC has predicted that 28.8 million barrels of oil a day will be consumed globally by its 12 members next year, which is 100,000 barrels less than was predicted last month.

"Mexico, Oman and Equatorial Guinea encountered minor upward revisions," OPEC's Vienna-based secretariat said in the report. Global consumption may weaken during the rest of this year because of "the severity of the economic crisis and its prolonged impact on the world economy."

The report suggests that producers outside of OPEC will produce 52.42 million barrels a day, an increase of 360,000 barrels a day.

Due to a rise in production of oil in Asia, Latin America and the Middle East, OPEC anticipates global oil growth in 2011 will be 1.05 million barrels a day, which equates to a 1.2 percent increase. Given the increase consumers will require 200,000 more barrels a day from OPEC next year, even after this month's lowered expectation.
The 12 OPEC members produce more than a third of the world's oil supply.

OPEC's 12 members are Algeria, Angola, Ecuador, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela. The organization's next meeting is scheduled for 14 October in Vienna.

Oil futures traded around $75 a barrel in New York today, after climbing 78 percent last year.

Related articles:

Will OPEC raise output? | OPEC production reaches high | OPEC Monthly Report | Economic slowdown doubles challenges facing refiners - Refining | Oil and gas production in Kuw

UAE to invest in Iraq oil and gas?

Tue, 17 Aug 2010 13:14:00 +0100

Energy companies in the UAE are reportedly interested in investing in Iraq's oil and gas industry in a bid to increase output.

Speaking to the press, Abdullah Ibrahim Al Shehhi, the UAE's ambassador to Iraq, said, "There are indicators that the UAE will have a place in the petroleum and energy sector (in the country)."

One of the country's chief investors, Mubadala Development Co., is rumoured to be interested in expanding into Iraq, increasing the amount of bilateral trade between the two countries. Currently, the amount of trade is said to be worth around $5 billion, but that is expected to rise to $7 billion.

It is not just the oil and gas industry that is looking to invest in the country, but also property and airline firms are hoping to expand their markets. In April, Ethidad Airways began flights to Iraq, while Emirates, the region's largest airline, is planning to start flights later in the year.

However, it is the energy market where the most interest and investment lies.

Oil and gas output

Iraq has already held two bidding rounds in an attempt to sell rights to develop hydrocarbon deposits, as part of their plan to expand oil and gas output. A third has been planned for later in the year and UAE oil companies are expected to bid heavily for the rights, as they lost out to international firms last year.

While no UAE companies qualified to bid in Iraq's first two auctions last year, Mubadala, which has exploration and production assets in Kazakhstan and Thailand, has joint ventures in the UAE and Bahrain with US producer Occidental Petroleum Corp., which is a partner to develop the Zubair oil field in Iraq. As such, it is expected to bid for additional rights.

Meanwhile, Petromal, an oil and gas explorer funded by members of Abu Dhabi's ruling family, aimed to bid for Iraqi assets in auctions last year along with partner Premier Oil and are expected to do so again this year.

Relevant articles:

UAE oil output to increase | Refinery expansion and pipeline projects | Basra oil field no longer included in Iraq's second bidding round

IPIC sells stake in Korean refinery

Fri, 13 Aug 2010 11:18:00 +0100

It has been announced that Abu Dhabi is to sell its 70 percent stake in a South Korean refinery following the loss of a legal battle with Hyundai Heavy Industries. It is said that their interest in the refinery is worth up to $2.2 billion.

The International Petroleum Investment Company (IPIC), the government controlled body that is responsible for all of the emirate's foreign oil and chemical investments, made the announcement in a statement to The National newspaper. The newspaper then reported the news that the stake in Hyundai Oilbank, South Korea's fourth-largest refiner, would be sold.

It was also reported that once IPIC sells its 70 percent stake to Hyundai Heavy Industries (HHI), HHI's overall stake will become 91.1 percent.

The sale comes after an international arbitration case at the Paris-based International Chamber of Commerce last year, when IPIC was ordered to sell its stake to HHI. IPIC initially refused but a Seoul court last month ordered it to do so.

Controversy

IPIC originally acquired half of Hyundai Oilbank in 1999, but by 2006 had increased its stake in the firm to 70 percent. However IPIC caused controversy when the group attempted to sell half of their HHI stake to Hyundai's rival, the GS group.

Unsurprisingly, HHI objected to this attempted sale, leading to the legal battle that has now seen IPIC forced to sell their share.

While the sale might be a blow for IPIC, the state-owned group doesn't appear to be resting on its laurels with plans to invest heavily in five refineries at a cost of $20 billion.

IPIC is said to be eyeing refinery projects in United Arab Emirates' Fujairah, Morocco, Oman, Pakistan and Jordan. The plans include a potential investment in Jordan Petroleum Refinery Co, which is looking at a $2 billion revamp of its refinery in he Al Zarqa area.

Relevant articles:

Qatar and Exxon partnership to end? | UAE oil output to increase | PIC plans $10 billion worth of projects

Qatar and Exxon partnership to end?

Wed, 11 Aug 2010 13:17:00 +0100

Although the two companies signed a deal in January to build a US$6 billion petrochemicals complex, there are industry rumours that Qatar Petroleum and Exxon Mobil Corp may be about to go their separate ways.

According to Arabian Business, Qatar Petroleum may be potentially looking for a different partner in the project, citing an official at the energy company.

The unnamed official said that Qatar Petroleum will select as a partner "the company that makes the best proposal".

The rumour was also backed up by the Middle East Economic Digest, who agreed that Qatar Petroleum was seeking new partners in the project.

Biggest single energy investment in Qatar

Comments from the two companies have been thin on the ground, with Qatari Energy Minister Abdullah bin Hamad al Attiyah declining to comment and a Exxon Mobil spokesman saying that "the company continues to work with Qatar Petroleum on the project."

It will be a big blow to Exxon Mobil if Qatar Petroleum are looking for a new partner as the project represents the biggest single energy investment in Qatar since Royal Dutch Shell announced plans in July 2006 to build its US$19 billion Pearl gas to liquids plant.

The planned petrochemical facility is (if it goes ahead) to include a 1.6 million ton a year steam cracker, two 650,000 ton polyethylene plants and a 700,000 ton ethylene glycol unit.

The massive project was due to be completed in 2015, however it has not been reported how the shake-up will affect this timetable.

The plant is part of Qatar's plans to aim its annual production of petrochemicals to 28 million tons by 2014, by making use of its rising output of natural gas, a feedstock for chemicals manufacturing.

The state is already the holder of the world's third largest gas reserves, but plans to increase its output to 23 billion cubic feet of gas a day by 2014. As such, the gas-rich country is expected to raise its LNG producing capacity from 54.3 million metric tons to 77 million by the end of the year.

Oil production will also be increased with exports rising from 798,000 barrels a day to 889,000 barrels by the end of next year. Output capacity is forecast to reach 1 million barrels a day.

Relevant articles:

Qatar's 2014 energy expenditure |Qatargas award contract to Fluor | Qatar Petroleum and ExxonMobil to work together

UAE oil output to increase

Thu, 05 Aug 2010 15:27:00 +0100

The United Arab Emirates has announced it is to increase its oil production capacity from its current level of 2.7 million barrels per day (bpd) to 3.5 million bpd.

The news comes an Abu Dhabi's Department of Economic Development report that also lists the UAE's current reserves at 98.2 billion barrels. That is an increase on the figure released by the Organization of the Petroleum Exporting Countries (OPEC) earlier in the year that estimated UAE reserves at 97.8 billion barrels.

"Abu Dhabi has set ambitious targets to increase total production capacity from the current 2.7 million barrels of oil per day to 3.5 million bpd by 2018," said The Oil and Gas Year, Abu Dhabi 2010.

The report put Abu Dhabi's proven oil reserves at 98.2 billion barrels, and 95 percent of the reserves of the United Arab Emirates, which are ranked seventh largest in the world.

Currently, the UAE is producing below its capacity with output at around 2.3 million bpd. However, the reductions, approved by OPEC, have been enforced since December 2008 when the global recession caused oil prices to crash.

Sector investment

In the UAE, it is Abu Dhabi that has invested the most in oil production with US$30 billion going into oil and gas projects between March 2009 and March 2010. As such, the report said that operators and service providers have been able to "make the best" of the global economic downturn by purchasing materials, equipment and manpower at lower cost.

The aim to increase production has even led to Abu Dhabi investors such as Mubadala Development Co. contemplating buying assets from BP, who are desperately trying to raise money in the wake of the BP oil spill.

Relevant articles:

PIC plans $10 billion worth of projects | Refinery expansion and pipeline projects | Qatar's 2014 energy expenditure

PIC plans $10 billion worth of projects

Tue, 03 Aug 2010 16:06:00 +0100

Kuwait's Petrochemical Industries Co has announced that over the next four years, it will invest US$10 billion into a series of projects. The news has come as the firm cancelled a venture with Dow Chemical Co which would see it expand its operations.

Among the series of projects that PIC will invest in include the building of a third mixed-feed olefins facility, estimated to cost about US$5 billion with an annual output capacity of 1.4 million tons of ethylene.

In an interview, company Chairwoman and Managing Director Maha Mulla Hussein said that PIC's share in a proposed refinery and petrochemical complex costing about US$9 billion in China's Guangdong province is also part of the company's projects.

Putting the pressure on BP

Kuwait has also in recent days commented on its stake in BP saying it is satisfied, but may increase its holding if market conditions are favourable.

Speaking to the press in Moscow, Sheikh Ahmad al-Abdullah al-Sabah said, "We already have a stake there,"

"If Kuwait investment authorities see that there are more attractive opportunities, I am sure they will take them depending on the situation in the market."

BP may have recently finally sealed the leak in the Gulf of Mexico but has announced plans o dispose of as much as US$30 billion in assets in the next 18 months to raise cash to meet the costs of the clean-up operation.

Kuwait Investment Authority, the country's sovereign wealth fund, said on Monday it didn't receive any request from BP to increase its stake in the company, which is currently 1.75 percent

Relevant articles:

Refinery expansion and pipeline projects |Qatar's 2014 energy expenditure | Is Abu Dhabi considering BP investment?

Refinery expansion and pipeline projects

Thu, 29 Jul 2010 15:18:00 +0100

This week, the Gulf region has seen a flurry of oil and gas news such as the expansion of an Omani refinery and plans for Abu Dhabi to build new Kuwaiti oil and gas pipelines.

In Oman, it is the Sohar refinery in the northeast of the country that is planned for expansion as part of an overhaul across the country's entire energy industry. The refinery is expected to see US$300 million spent on its renovation which will see increase its production from 116,000 barrels per day (bpd) to 190,000 bpd.

Speaking to Arabian Business, a financial ministry official said the upgrade should take place in 2013. It is all part of Oman's plans to increase oil output in the face of falling production. The project has received heavy investment as it is hoped that the increase in production will lead to an increase in exported refined fuels to international markets.

Kuwaiti contracts

While Oman seeks to increase production, Kuwait has awarded a US$400 million contract to Petroface of Abu Dhabi, to build fuel and gas oil pipelines for Kuwait Oil Company.

In a statement, Kuwait Oil Company said the contract, which will span an estimated 23.5 months, will include a fuel oil pumping station, metering systems, utilities systems.

It is a lucrative project for the Abu Dhabi based firm, whose home state is also planning their own expansions, but of new petrochemical plants.

For the emirate, they are planning to build the new plants near an existing oil refinery at the Ruwais industrial area rather than at a port closer to the UAE capital. It is at this site that state-owned Abu Dhabi National Chemicals Co. will shift all planned sites gaining more direct access to the refinery by-products that will feed its systems.

The petrochemical developer, known as Chemaweyaat after the Arabic word for chemicals, had initially planned to build some plants at the projected Port Khalifa, a new industrial zone between Abu Dhabi and Dubai.

Relevant articles:

Qatar's 2014 energy expenditure | Is Abu Dhabi considering BP investment? | Investment needed in ageing Arab refineries