Industry Links

Takreer (Abu Dhabi Oil Refining Company) has awarded a contract worth US$623mn to South Korean company GS Engineering & Construction Corporation for engineering, procurement, construction and commissioning (EPC) works of the Inter Refinery Pipelines (IRP-II) project.

Schlumberger has closed its merger with Smith International. Each Smith stockholder will receive 0.6966 shares of Schlumberger common stock in exchange for each Smith share, with cash paid in lieu of any fractional shares of Schlumberger common stock. Schlumberger has issued approximately 176mn shares pursuant to the merger, representing a transaction value of approximately US$11 billion. As a result, former Smith stockholders own approximately 12.9 per cent of Schlumberger's outstanding shares of common stock.

Iran has allocated US$2.2 billion for seven gasoline production and refinery renovation projects, the Iranian deputy oil minister Alireza Zeighami has been quoted as saying by the Mehr News Agency. The projects are currently 70 per cent complete on average.

Two Very Large Crude Carriers (VLCCs), amounting to four million barrels of Oman crude, are to be shipped to the US west coast. The rare move comes after the arbitrage window was opened over the past few weeks, according to industry sources.

UAE's state-run Abu Dhabi National Oil Co (ADNOC) has reissued a tender to import 180,000 tonnes of petroleum as it prepares to shut two units at its 415,000 bpd Ruwais refinery, according to an industry source. The reissued tender will close today for cargoes to be delivered from October to November, Reuters said the source disclosed. ADNOC was not immediately available for comment.

Kuwait Petroleum International may be interested in buying some of BP's assets, according to the country's oil minister. Sheikh Ahmad Al-Abdullah Al-Sabah told journalists in Moscow, after meeting Russia's Energy Minister, that Kuwait was satisfied with its current BP investments, although state-run Kuwait Petroleum would consider investing further if assets put up for sale were attractive and fit in with the company's strategy.

Kuwait Energy Company has announced that it has entered into a sale and purchase agreement with Beach Energy Limited as part of its ongoing portfolio management. The deal covers the partial divestment of two Kuwait Energy assets in Egypt, the Abu Sennan and Mesaha concessions. Kuwait Energy will remain the majority holder and operator of the Abu Sennan concession.

RPS has established a new office in Abu Dhabi, to strengthen further its capability throughout the Middle East region. RPS operates across a broad range of disciplines incorporating oil and gas, renewables and has the planning, environmental and health and safety expertise that is needed for major energy infrastructure projects.

Southern Iraq is changing as oil production brings more work and development. However, so too are the security challenges in the area. The threat of militias and terrorism may have diminished but there is no reason to assume that security will soon cease to be a concern.

The International Energy Agency has predicted that global oil demand will increase at a slower pace next year in its first assessment of 2011. Crude oil consumption will climb 1.3mn bpd globally, or 1.6 per cent, to average 87.8mn a day, the agency said in its most recent monthly report. This leaves the IEA estimate for this year unchanged at 86.5mn and the advising body said that the rate of demand growth for 2011 will be less than this year’s 2.1 per cent as a result of increased fuel efficiency in the industrialised nations of the Organisation for Economic Cooperation and Development.

Nabucco Gas Pipeline International, the consortium that plans to build the US$10 billion Nabucco natural gas pipeline, may add Abu Dhabi's International Petroleum Investment Company (Ipic) as a member by the end of this year. According to the Dow Jones Energy Daily, which quoted an industry source and a person close to the company, Ipic is interested in taking an equity stake in the project.

Libya's most senior oil official has said that the country should buy a strategic stake in BP to take advantage of its weakened share price triggered by the giant oil spill from one of its wells in the Gulf of Mexico. Shokri Ganem, chairman of Libya's Nation Oil, said he will recommend buying a stake in BP to the Libyan Investment Authority (LIA), the North African state's sovereign wealth fund.

Singapore has reported a 39 per cent year-on-year increase in oil supplied to the country by the UAE. This is in contrast to a 16 per cent drop in imports during the same period a year ago, according to a study by the Dubai Chamber of Commerce and Industry.

State-run Oman Oil Company (OOC) is reportedly in talks with Oman's Ministry of Oil and Gas to take on an exploration block ceded by Britain's BG Group, according to a senior Omani oil official.

Apache Corporation has announced that new production from its Faghur Basin fields has propelled its Egyptian gross-operated oil and gas production above 330,000 barrels of oil equivalent (boe) per day. This surpasses the company's goal set in 2005 of doubling output from Egypt's Western Desert within five years.

The International Energy Agency (IEA) has forecast that global oil demand will increase by 1.4 per cent (1.2mn barrels per day), to reach 92mn bpd by 2015 according to its latest Medium-Term Oil and Gas Markets 2010 report.

Abu Dhabi Polymer, or Borouge, the largest manufacturer of plastic raw materials, has announced that phase two of its expansion project is 98 per cent complete and will go into production in November. The US$5 billion expansion project has developed the world’s largest ethane cracker with 1.5mn tonnes production capacity annually, next to Abu Dhabi’s Ruwais hydrocarbon complex, chief operating officer, Roy Vardheim, was reported as saying by the Khaleej Times.

Yemen LNG has announced that its first train is producing at 99 per cent availability and its second train at 91 per cent availability. The announcement was made by the company's general manager, Francois Rafin, recently. In October, production started at the first train of the US$4.5 billion project to produce LNG.

Russia's oil arm, Rosneft, has signing up to a ground-breaking gas project with UAE energy firm, Crescent Petroleum, according to Russia's top energy official. Rosneft will join Crescent in running a gas concession in the emirate of Sharjah, Crescent said recently, in the first Middle Eastern foray for the state-run Russian firm. The pair will consider more joint ventures in the Middle East.

Kuwait National Petroleum Company, Kuwait's state-run refining division, is on the verge of signing a US$890mn with South Korea's Daelim Industrial for a gas facility and pipeline, according to a KNPC spokesman. The facility would have capacity to treat 850mn cubic feet per day (cfd) of natural gas, the spokesman was quoted as saying by Reuters.

Masdar, Abu Dhabi’s renewable and alternative energy technologies and solutions initiative, has appointed the bidding consortium of Total and Abengoa Solar as a partner to own, build and operate Shams 1, the world’s largest concentrated solar power plant (CSP). One of Masdar’s flagship projects and the first plant of its kind in the Middle East, Shams 1 will directly contribute towards Abu Dhabi’s target of achieving 7 per cent renewable energy power generation capacity by the year 2020.

Crescent Petroleum has signed a co-operation agreement with Russia's Rosneft, in which the companies will seek deals jointly in the Middle East and North Africa (MENA) region. State-dominated Rosneft is Russia's largest oil company, and has in recent years started to expand internationally, and Crescent Petroleum - together with affiliate Dana Gas - is the region's largest privately owned oil and gas company.

The offshore division of the Abu Dhabi National Oil Company (ADNOC) hopes to stop the wasteful burning of natural gas, or flaring, within the next five to seven years according to Bloomberg. ADNOC will become the first in the Gulf to end flaring that contributes to the emirate’s carbon footprint, a senior company official said.

The Arab Energy Conference opened recently in Doha, Qatar, with Qatari deputy prime minister and minister of energy and industry, Abdullha bin Hamad Al-Attiyah, delivering a keynote speech on behalf of Qatari Emir Sheikh Hamad bin Khalifa Al Thani. According to reports from the Global Arab Network, he stressed Qatar's significant role in supplying international markets with crude oil and natural gas. He said that his country is the key world producer and exporter of liquefied natural gas with Qatar to produce roughly 77mn tons by the end of this year. Al-Attiyah said that the conference would reflect on investment for Arab oil projects and the link between energy, the environment and sustainable development, as well as energy cooperation among Arab nations.

A deal between Iraq's central government in Baghdad and its semiautonomous northern Kurdish region to restart oil exports could come within days, Iraq's deputy oil minister has been quoted as saying.

Kuwaiti Minister of Oil, Sheikh Ahmad Al-Abdullah Al-Sabah, has said a fresh strategy has been set out to raise oil output to four million barrels per day by 2020, and gas output to one billion cubic feet per day by 2016.

Bahrian's Oil and Gas Affairs Minister, Abdulhussain Mirza, has said that talks between Bahrain and Iran on the price of gas imports are likely to be lengthy. The kingdom signed a preliminary agreement in 2008 with Tehran to import up to one billion cubic feet per day (cfd) of natural gas from the Islamic republic, but the two countries have yet to agree final terms.

NEARLY 300 BUSINESSES, government agencies and institutions rented space at Syroil in 2008. This year’s event, from 5-8 April, should attract even more because of Syria’s fast-rising status as the oil and gas crossroads of the eastern Mediterranean.

GRANT THORNTON LLP, the US member firm of Grant Thornton International Ltd, one of the six global accounting, tax and advisory organisations, has just published its eighth annual Survey of Upstream US Energy Companies – and the outlook, it seems, is good.

Iraq's oil ministry has launched The Midland Oil Company. It will be responsible for overseeing development in recently auctioned fields in the centre of the country. Midland (aka Sharikat Naft Wasat) will be the fourth state company, joining the North, South, and Maysan companies.

 According to recent reports, India, which is already the world's fifth-largest energy consumer and imports more than three quarters of its crude oil requirements, is about to increase its crude oil imports from Middle East, to fuel its upcoming refining capacities.

Petroleum company Dana has announced a second gas discovery in the West El Burullus concession, offshore Nile Delta, Egypt. To date, Dana and GDF Suez have drilled two wells in this concession and made two discoveries.

Epsilon Energy Ltd, a producer of natural gas and oil, has announced the sale of Epsilon Energy Yemen Ltd to an unrelated third party purchaser for US$100,000, pending government of Yemen approval.

Ahmad Humaid Al Tayer, Governor of the Dubai International Financial Centre (DIFC) and chairman of the UAE's largest bank, Emirates NB, has said that the UAE's oil reserves will help to support the country's growth for the next 30 years.

Reports that OPEC aims to call for further compliance before considering any output cut if oil falls below US$70 a barrel may be at least temporarily rendered redundant by a recent rebound in the price of crude.

News agencies in Tunisia have reported that an agreement on guarantee and another loan agreement granted by the Islamic Development Bank (IDB) to Tunisia's power and gas utility (STEG) to finance a natural gas project in Gafsa, a city in west-central Tunisia, were signed recently in Tunis by representatives of government, STEG and IDB.

Italian energy giant ENI will not make any further investments in Iran, according to a recent announcement by the CEO Paolo Scaroni. He said the outstanding two contracts, signed in 2000 and 2001 for the development of two fields, will be honoured.

Things appear to be moving fairly quickly since the discovery of a new oil field offshore Dubai was announced recently. The latest news is that, according to a recent official statement, the field is likely to enter commercial production within a year.

The possibility of a further boost to gas and oil supply for Iran, both locally and for export, was raised earlier this week when the country’s Oil Ministry's news agency announced the discovery of an oil field and a gas field.

Schlumberger, a supplier of technology, integrated project management and information solutions to customers working in the oil and gas industry, has announced the appointment by its Board of Directors of a new Chief Operating Officer of Schlumberger Limited.

The General Manager of the Abu Dhabi Company for Onshore Oil Operations (Adco), Abdul Munim Saif Al Kindi, has announced that the company plans to award $1.8 billion worth of engineering, procurement and construction (EPC) contracts this year. The contracts will involve the development of the Bab, Qusahwira and Bida Al Qemzan fields. In 2009 EPC contracts worth $3.5 billion were awarded by Adco for the development of its Shah, Asab and Sahil fields.

Following the announcement in January from the US Commodity Futures Trading Commission that it proposed to limit speculation on energy futures, it has seemed likely that Abdalla El-Badri, OPEC's Secretary General since 2007 and a former deputy prime minister of Libya, would be supportive.

Aramco Overseas Company BV, a subsidiary of Saudi Aramco has awarded, Keppel FELS Limited, a major group of companies in the offshore, energy and engineering industry, a contract to build a customised KFELS Super B Class jackup rig. This is said to be Aramco’s first purpose-built, next-generation mobile offshore drilling rig.

According to Schlumberger Limited’s recently announced fourth-quarter and full-year 2009 results, its full-year 2009 revenue was US$22.70 billion. This compares with US$27.16 billion in 2008. Fourth-quarter revenue was US$5.74 billion (compared with US$5.43 billion in the third quarter of 2009, and US$6.87 billion in the fourth quarter of 2008).

Among recent activity in the continuing upsurge in oil-production related deals in Iraq is the news that Occidental Petroleum Corporation and Korea Gas Corporation (KOGAS) have signed a technical service contract with Iraq's state-owned South Oil Company (SOC) and Missan Oil Company as State Partner, to redevelop the Zubair field, near Basra in southern Iraq.

THE UAE WILL play a pivotal role in sustainable energy projects, spearheading efforts in the Gulf to contribute to the global advancement towards a less carbondependent world, a top official told a regional energy security conference recently. "We are the first country in the Gulf which undertook a leading commitment in producing renewable energy.

THE COMBINED OIL income of Gulf Cooperation Council (GCC) countries is expected to reach US$1 trillion (Dh3.67 trillion) by 2030 at current oil prices, an energy expert said at an industry conference in Abu Dhabi recently. "The Gulf contains 40 per cent of the world's proven oil reserves and 23 per cent of its gas reserves," Dr Hesham Al Khateeb, Honorary Vice-Chairman of the World Energy Council, told delegates.

BAHRAIN IS SEEKING to increase its oil production to 250,000 barrels per day over the next seven years, the Gulf nation's oil and gas minister Abdul Hussein Mirza said recently. Bahrain currently pumps 33,000 barrels a day of oil from its own field, and plans to raise that to 100,000 barrels a day in seven years after an agreement last month with U.S. oil firm Occidental Petroleum Corp (OXY) and Abu Dhabi's Mubadala Development Co, Mirza said.

AS A GROUP, the six-nation Gulf Co-operation Council (GCC) controls a sizable portion of proven oil reserves. Still, several GCC countries have contracts with international oil companies to explore for fresh oil reserves of commercial quantity.

GULF HYDROCARBON PROJECTS have topped US$690 billion, says a report by Dubai-based research house Proleads Global. A full 30 per cent of hydrocarbon projects by value have been put on hold or cancelled, it said. The report shows, however, that the GCC countries remain the most active construction markets in the world for the oil, gas and petrochemical industries

THE ABU DHABI National Oil Company (Adnoc) and its subsidiaries and several international petroleum companies operating in the emirate recently signed a charter pledging greater investments in sustainability particularly in health, safety and environment.

MUBADALA DEVELOPMENT COMPANY (Mubadala) and the National Oil and Gas Authority (Noga) have set up a new joint operating company. The Tatweer Petroleum-Bahrain Field Development Company (Tatweer Petroleum), will serve as the operator for the Bahrain Field. The company will operate under the development and production sharing agreement signed in April by the partners, including Occidental Petroleum, and approved by the Bahraini parliament in May.

Iraq managed to license seven out of 10 offered oilfields, ending its two-day auction on a high note, after only the two largest fields offered during the first day had been taken. Relatively fierce competition was expected for most of Iraq's mega-fields, with some of the lesser fields in the south also seeing a number of highly interested suitors in the run-up to the bidding.

GCC countries are expected to earn US$4.7 trillion in oil exports by 2020 going by the Opec targeted floor price of US$50 per barrel, a recent report by Ernst & Young says. 'This will be 2.5 times their [GCC countries'] oil earnings over the last 14 years. Middle East economies are predicted to be a real growth story for the next few years,

ABU DHABI NATIONAL Oil Company (ADNOC) expects to save 30 per cent on the cost of developing its major oil and gas projects because of lower construction costs. In the keynote address at the Energy Exchange’s Gas Arabia conference in Abu Dhabi recently, Ismail al Ramahi, the manager of ADNOC’s gas process division, said the company would press ahead with energy development during the global economic downturn, but at much lower cost than it previously expected.“

OMAN HAS NO plans to cut oil production this year, said a top oil and gas ministry official after the country managed to arrest six-year production decline. "We plan to increase the daily production of crude oil and condensates from 757,000 bpd in 2008 to 805,000 bpd this year,

A REPORT BY Iran's national audit office that US$1 billion of the country's oil revenues have gone missing may create an embarrassing problem for President Mahmoud Ahmedinejad

LEAST AFFECTED BY the current global economic meltdown, the Saudi petrochemical companies are poised to make an aggressive entry into more foreign markets at the expense of their counterparts in Europe.