Bypassing Suez Canal: Russian-Iranian Transportation Project Gets Approved

The Russian transit project "North-South" has received international support. Earlier it was reported that Moscow, together with Tehran, began to actively explore the feasibility of implementing a corridor for the flow of goods from Asia to the EU. Unlike the Chinese "New Silk Road", the emphasis in this project is on the use of maritime transport. It is expected that the time savings for the delivery of goods from Asia to the EU can be up to two weeks. Thus, the corridor "North-South" will become a serious competitor to the route passing through the Suez Canal.

The head of the port and shipping organization of Iran, Mohammad Rastad, reports on a significant increase in cargo turnover in the country's maritime harbors. It is noteworthy that the Iranian side continues to make serious efforts to further develop its port infrastructure. To this end, Iran signed a contract with India for the supply of port equipment worth US$85 million. It is expected that the renewal of the maritime infrastructure will allow the Iranian side to significantly accelerate the process of providing the necessary capacity for transshipment of goods, along the shortest route from India to the EU market. - RT


Iraq Britain Business Council Holds Successful Autumn Conference in Dubai

Following on from the first Iraq Britain Business Council conference in Dubai in 2016, the IBBC was delighted to host its Autumn Conference in the UAE once again. The event was strongly supported by the UAE authorities.

Alongside Baroness Nicholson, the UK Prime Minister’s Trade Envoy to Iraq and President of the IBBC, the conference was opened by H.E. Mr. Abdulla Ahmed Al Saleh, Under Secretary for Foreign Trade and Industry, UAE Ministry of Economy.

H.E. Mr. Abdulla reminded delegates that non-Oil & Gas related trade between the UAE and Iraq had already passed US$11 billion in 2016, with Dubai in particular being a hub for local and international companies in the region.

H.E. Mr. Abdulla firmly believes that the UAE’s role in the rebuilding of Iraq will continue to expand and expressed his wish to cooperate with organizations such as the IBBC to accomplish this crucial task.

Vikas Handa, IBBC UAE Representative and the Managing Partner of the Emirati Company DrillTech, warmly thanked the minister and stated that the IBBC stands ready to work even more closely with the UAE in Iraq.

The Government of Iraq sent a high calibre ministerial delegation led by H.E. Mr Qasim Al-Fahdawi, The Minister of Electricity, to the conference. The delegation included H.E. Mrs Ann Naufi Aussi Balbool, Minister of Construction Housing and Public Municipalities; H.E. Kadhim Fijan Al Hamami, Minister of Transport; H.E. Dr Sami Al Araji, Chairman of the National Investment Commission (NIC); and H.E. Mr Fayadh Hassan Nima, Deputy Minister of Oil for refining affairs.

The conference was structured around several sessions in which the Iraqi officials and international companies operating successfully in Iraq, most of which are members of the IBBC, exchanged their views and experiences.

These sessions focused on strengths, weaknesses and opportunities of the economy in Iraq, Reconstruction & Infrastructure, Transport, Power and Oil & Gas. In parallel, a series of high level round-table discussions between investors and Iraqi Government representatives took place.

The conference included for the first time a presentation on the rapidly developing Tech sector in Iraq, given by the CEO of Zain.

IBBC thanks the International Finance Corporation (World Bank) and the IMF for its participation. Thanks also go to the IBBC members who sponsored the conference: Gold Sponsor International Islamic Bank; Silver Sponsors Serco and Gulftainer; Lunch Sponsor Rolls-Royce; pre-reception Sponsor Wood; and Coffee Break Sponsors Eversheds Sutherland and KCA Deutag.

IBBC Managing Director, Christophe Michels, stated that the increasing involvement of the UAE and wider GCC with Iraq was a game changer for the country. The IBBC very much welcomes this development and is delighted to be part of it and support it. The organization will increase its presence in the UAE and the Autumn Conference in Dubai will become a regular feature in its calendar of events.


Omantel to Have Majority Presence on Kuwaiti Zain Board

Oman Telecommunications SAOG (Omantel) announced yesterday the nomination of four new members to the Board of Directors at Mobile Telecommunications Company KSCP (‘Zain’). Including the appointment of Talal al Mamari (pictured), CEO of Omantel, as a Non-Executive Director on September 19, 2017, Omantel will have a majority on Zain’s board with 5 of the 8 seats.

Talal Said Marhoon al Mamari, Chief Executive Officer, Omantel and Non-Executive Director of Zain said: “We welcome the nomination of the four new members to Zain’s Board of Directors. We look forward to working closely with the management teams and our fellow board members with the aim of bringing our two complementary businesses together and creating a new digital telecom powerhouse in the region. The new group has a balanced and diversified portfolio of growth and cash generative assets across nine markets. Bringing these assets together will generate synergies across wholesale, procurement and knowledge sharing along with increased collective exposure to high growth potential markets.”

On November 12, 2017, Omantel won the bid to acquire 12.1% of the issued share capital in Zain, making Omantel the second largest shareholder in Zain with a 21.9% stake. The total equity value is US$2.19 billion and includes the previously announced acquisition on August 24, 2017 of 9.84% of the total fully paid and issued share capital. The new group will be the third largest telecoms group in the Middle East and North Africa, with over 52 million customers.

This transformational transaction propels Omantel and Zain into a new era, bringing together a unique portfolio of leading telecom operations with balanced assets for profitability and growth. The transaction will bring economies of scale and sizeable synergies making the new group more agile and efficient.

Synergies will come from integrating the wholesale network with Zain’s, merging operations such as procurement, cooperating across our commercial activities and through shared investments in research and development. Omantel is targeting run rate synergies of over US$80 million per annum. Omantel will be fully consolidating Zain’s financials and presenting a combined set of Q4 and full year 2017 financial results in the next quarter. Omantel will finance this transaction with a combination of long-term and bridge loan facilities. The bridge loan facility will subsequently be recapitalized through bond-type instruments.


Oman & Qatar Review Investment Projects

Yusuf bin Alawi bin Abdallah, Minister Responsible for Foreign Affairs, received in his Office on Monday Ali Sharif al Emadi, Qatari Minister of Finance. They reviewed fraternal relations and means of enhancing them in various fields. Separately, Darwish bin Ismaeel al Balushi, Minister Responsible for Financial Affairs and Chairman of the Omani side in the Omani-Qatari Joint Committee, met with Ali Sharif al Emadi. The meeting discussed the investment projects being implemented in the Sultanate, in addition to the follow-up of the areas of cooperation agreed upon by the Omani-Qatari committee.


Petroleum Development Oman, Muscat University Sign R&D Deal

Petroleum Development Oman (PDO) has signed a research and development agreement with Muscat University to help resolve some of its complex technical challenges. The collaboration deal will support PDO’s effort to boost In-Country Value by advancing academic and vocational development and increasing the share of the oil and gas industry’s wealth retained in Oman.

The Memorandum of Understanding (MoU) will also pave the way for students to develop their technical expertise through placements with the Company and the university will collaborate on sharing best practice in the area of Knowledge Management.
The two organizations will also work together to encourage Omani small and medium-sized enterprises (SMEs) and entrepreneurs to carry out their basic technological research, test-proof their conceptual thoughts and innovative ideas and develop early-stage technology in the university’s laboratories prior to any potential future commercial agreements.

PDO will assist with the establishment of a technology center at the university and its own experts will be given access to these research hubs and run and develop teaching programs. The MoU was signed by Professor Yusra Mouzughi, Interim Vice Chancellor of Muscat University, and PDO Technical Director Amran al Marhubi who said: “PDO is working hard with key research partners to establish hubs of technological expertise in Oman which can help us to address some of our key challenges. “These collaborations not only give us access to innovative solutions and the best technology and tools but also enable students to learn more about the needs of the Sultanate’s economy and their potential employers.


Dubai Eyeing New Record as Tourist Arrivals Hike

A total of 11.58 million international overnight visitors arrived in Dubai during the first nine months of 2017, reflecting a 7.5 % increase over the same period last year, keeping the Emirate on track for another record year in tourist volumes, according to the latest data released by Dubai’s Department of Tourism and Commerce Marketing (Dubai Tourism).

India retained top spot on Dubai’s list of source markets for inbound tourism, with 1,478,000 Indian tourists arriving in the city between January and September, registering a significant 20 % rise over the same period in 2016.

This increase affirmed the effectiveness of various innovative promotional activities driven by Dubai Tourism in the market, including highly successful influencer-led collaborations with Bollywood superstar Shah Rukh Khan. Meanwhile, China stayed in fifth place with impressively large 49 % year-on-year growth, delivering 573,000 visitors in the first nine months of the year and continuing to benefit from regulatory changes introduced in late 2016 granting Chinese citizens free visa-on-arrival access to the UAE.

Saudi Arabia and the UK also retained their positions as Dubai’s second and third largest feeder markets respectively. A total of 1,250,000 Saudis and 905,000 British travellers arrived in the emirate between January and September 2017, the former showing a slight drop compared to the first nine months of 2016, reflecting the ongoing economic challenges facing Saudi Arabia, while the UK witnessed a resilient 2 % year-on-year increase despite continued Brexit instability.

Almost all the top 10 markets – with the exception of Oman and Kuwait, which saw declines of 23 % and 3 % respectively – posted healthy increases in tourist traffic, including sixth-placed US up 6 %, seventh-placed Pakistan up 4 %, eighth-placed Iran up 16 % and ninth-placed Germany up 6 %.

Among the top 20 feeders of traffic, Russia topped the growth charts, posting an increase of 95 % and continuing the pronounced resurgence seen earlier in the year following the February introduction of UAE visa-on-arrival access for Russian citizens.

Philippines in 11th position, France in 15th, Jordan in 17th and Lebanon in 19th also saw double-digit year-on-year increases of 10 %, 12 %, 18 % and 15 % respectively, with 13th-placed Egypt, 16th-placed Italy and 18th-placed Canada showing lower, yet stable increases at 2 %, 4 % and 1 % respectively. Only two markets –Australia and Bahrain – witnessed nominal declines of 2 % each.

From a regional perspective, the GCC emerged as the largest contributor of overnight visitor volumes, with a 21 % share compared to second-placed Western Europe’s 20 %. These were closely followed by South Asia with a share of 18 %, the Mena and North and South-East Asia regions with 11 % each, the Americas and the Russia, CIS and Eastern Europe bloc with 6 % each, Africa with 5 % and Australasia with 2 %.

The wide geographical spread reflects Dubai’s diversified market strategy aimed at driving consideration from a broad spectrum of countries and visitor segments.

As Dubai continues to evolve and expand its offerings across all pillars of its destination proposition, these latest figures affirm the strength of the emirate’s tourism industry as well as the growing attractiveness of Dubai as a leisure and business destination.

The performance in the first three quarters of 2017 indicates that the emirate is making sustained progress towards its Tourism Vision 2020 goals of welcoming 20 million visitors per year by 2020 and increasing the tourism sector’s contribution to GDP.

Helal Saeed Almarri, director general, Dubai Tourism, said: “The sustained growth ahead of the global average that we have witnessed so far this year is indicative of the positive impact yielded by our consolidated strategy across regulatory measures, promotional efforts, trade initiatives and partner programmes.”

“Even as we continually work to ensure Dubai’s proposition remains stellar and globally competitive, drawing on the concerted cross-industry efforts of all stakeholders, our priority remains the delivery of the highest levels of visitor satisfaction. Ultimately, our aim is to make every satisfied Dubai visitor our customer for life and our strongest advocate, in order to drive not only higher repeat traffic but also acquire newer audiences most efficiently, as we strive towards our 20 million target by 2020.

“At the same time, in line with the 10X Agenda set by His Highness Sheikh Mohammed bin Rashid Al Maktoum, UAE Vice-President and Prime Minister and Ruler of Dubai, we are focused on continuously innovating, harnessing the power of data, redefining the customer journey and amplifying the voice of the traveller, to ensure that Dubai is a decade ahead of any other global city from a travel and tourism perspective,” he added.

Dubai’s hotel sector, meanwhile, also saw significant growth, with the city’s total number of hotel and hotel apartment keys standing at 106,167 at the end of the third quarter of 2017, spread across 678 establishments, representing an aggregated 6 % increase in capacity over a 12-month period versus end of September 2016.

Luxury five-star hotels, Dubai’s strongest proposition globally, made up 33 % of the emirate’s total inventory, with four-star hotels commanding a 23 % share and properties in the one- to three-star categories a share of 21 %, reflecting the benefits of a sustained approach to balancing the mix and driving consideration from diverse segments including families. Hotel apartment establishments made up 23 % of total inventory, split into deluxe/superior and standard categories, with 9 % and 14 % shares respectively.

Average occupancy for the hotel sector as whole stood at 76 %, remaining unchanged from the end of Q3 2016, underscoring the industry’s foundational stability and enduring attractiveness despite rising supply. Occupied room nights were up year on year, totalling 21.27 million compared to 20.45 million at the end of September 2016, while guests’ average length of stay decreased very slightly from 3.6 to 3.5 nights, in part due to an increase in stopover travellers.


Denmark, Iran Sign 3 Water MoUs

Iranian and Danish companies inked 3 Memoranda of Understanding (MOUs), in the presence of Iranian Substitute Minister of Energy (Water & Electricity) for Economic Affairs and Planning Alireza Daemi and Danish Ambassador Danny Annan. The agreements was about  water and waste water sectors.

During a joint meeting with Danish ambassador and some of the active companies of the country in the field of water management, waste water management and water supply, Daemi said the history of Iran-Denmark ties in the field of water and sanitation issues goes back to the far past.

Previously, he noted, we have been cooperating with Danish companies in the field of construction of wastewater treatment plants and also in scientific and research areas. "Over the past one and a half years, there have also been held very good meetings with Danish sides to deepen the bilateral relations, and, thankfully, this has led to the presence of Danish investment companies in the field of water and sanitation inside Iran," Daemi asserted.

Alireza Daemi emphasized that "in addition to finding business partners in Iran, we expect the Danish companies to facilitate the process of banking transactions and project financing."  He also added "we hope Danish companies would consider the use of Iran's domestic capacities in the implementation and investment of their projects in the Islamic Republic."

At the end of the meeting, 3 MoUs were signed between Iran Ensheab Co., Tara Engineering Co., and Tamin Energy Development Company (TEDCO) with their Danish counterparts, on the construction of water desalination units, sewage treatment plants and water intelligent meters. - Mehr


Dubai Maritime City Authority Chairman, Maersk CEO Meet

Sultan Ahmed Bin Sulayem, chairman of Ports, Customs and Free Zone Corporation and Dubai Maritime City Authority (DMCA), today met with a delegation from Maersk to share knowledge and improve cooperation between the companies.

The Maersk delegation was headed by Johan Uggla, CEO of Maersk, one of the world's largest container shipping and logistics companies.

Bin Sulayem discussed Dubai’s leading efforts in ports and logistics development in terms of infrastructure and legislations, aimed at enhancing the local maritime sector, said a statement.

Uggla visited Dubai with a group of top-level delegates and shared the latest knowledge and successful experiences in global maritime with DMCA officials, noting Dubai’s most competitive features that enhance its position as one of the most attractive destination for international companies, including Maersk.

The meeting provided a platform for discussion on international best practices in shipping considering Maersk's leading experience as one of the largest container and supply vessel operators in the world.

Both parties also explored possible areas of cooperation in terms of providing training using the latest methods and advanced simulation systems aimed at meeting the needs of public and private maritime stakeholders.

The delegation lauded Dubai’s position as a major hub and center for regional and international maritime training which enjoys the support of initiatives that develop highly-qualified national maritime professionals such as the Dubai-based Maersk Training Center, a first of its kind in the Middle East. Such initiatives aim to train new maritime leaders which will steer the sector to become competitive, comprehensive and attractive international maritime destination.

Bin Sulayem noted that the meeting opens new horizons for knowledge transfer and exchange of expertise and modern practices that will help the sector face challenges and pursue opportunities in the local and international maritime sector, as well as improve training and maritime support services.

This is in line with Dubai’s global goal of building a renewable and secure marine sector based on key values such as leadership, creativity, innovation and excellence in human capital.

The DMCA chairman further emphasized the importance of training as a foundation for developing human resources in the maritime sector, in accordance with the highest international standards under the directives of HH. Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the UAE and Ruler of Dubai to build productive, creative and entrepreneurial individuals capable to lead the future and contribute to achieving the UAE Vision by 2021.

He added that the DMCA looks forward to work closely with Maersk and Maersk Training as part of its strategic partnership with public and private sectors, which will position Dubai as a leading regional and global maritime center.

Bin Sulayem continued: “We appreciate Uggla’s presence, whose company has started its maritime operations in Dubai since the early 1950s. Maersk has provided significant contributions to support our efforts in investing in human capital through the Maersk Training Center, which is recognized as the first maritime training center in the Middle East.”

“By offering courses and educational programs using technological innovation, it helps meet our needs for local, regional and global growth strategies, which will push Dubai towards becoming the maritime capital in the world,” he concluded.

The center in Dubai is one of four training centers in the world owned by Maersk, apart from ones located in Denmark, Houston (US) and London (UK).

It aims to provide an integrated platform for companies and organizations working in the maritime sectors in the Middle East, Africa and Asia to take advantage of its extensive portfolio of training courses specifically designed to develop skills and establish exact and comprehensive standards that will enhance the safety and operational performance of the maritime sector in the Middle East, it stated.


UAE Ratifies International Maritime Conventions, Protocols

The UAE has ratified key International Maritime Conventions and Protocols as part of its efforts to develop maritime and shipping sector.

This is expected to strengthen UAE's position in the International Maritime Organization (IMO) and among other IMO member states.

The ratification came after a series of preparations by the Federal Transport Authority (FTA) - Land and Maritime to meet the international requirements and standards set by IMO, including the implementation and enforcement of the international conventions and protocols in all relevant national maritime activities.

The UAE has ratified the following international conventions and protocols:
• Ballast Water Management Convention 2004;
• Protocol of 1988 relating to the International Convention on Load Lines 1966;
• Protocol of 1988 relating to; International Convention for the Safety of Life at Sea 1974 (Solas);
• International Convention for Safe Containers (1972).

Dr Abdulla Belhaif Al Nuaimi, Minister of Infrastructure Development and chairman of the FTA - Land and Maritime, noted the efforts exerted by the FTA in cooperation with all concerned authorities in the UAE, highlighting the FTA’s commitment to international standards and compliance with international maritime conventions and protocols.

He added that the authority has developed the working plans to meet the international requirements, and lauded the country’s efforts to improve the maritime sector and help create a safe and secure marine environment for a sustainable maritime community.

The confirmation to comply with international maritime conventions and protocols will enhance the country’s activities related to the safety of lives at sea, provide secure conditions for international shipping, and establish better conditions for safe navigation for sea cargo and passenger transport.

Al Nuaimi added: “The UAE has several competitive advantages to qualify for membership in the IMO Council and enjoys strong capabilities at par with countries with advanced maritime industries, a number of which have major interests in international maritime trade.”

“The UAE also enjoys a strategic location, ideal for doing business in the GCC and the broader Middle East and North Africa (Mena) region,” he concluded.


Oil, Gas to Stay Key Energy Source until 2040: OPEC

Oil will remain the world’s largest source of energy over the next two decades, despite the increasing importance of renewables, predicts the latest edition of the OPEC World Oil Outlook. Released in an exclusive briefing to senior industry executives at the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC), the outlook forecasts that oil will supply just over 27% of worldwide energy needs in 2040, while natural gas will see its share at slightly more than 25%, a Wam news agency report said.

The scenario would see demand grow from 95.4 million barrels per day, in 2016, to reach 111.1 million barrels per day by 2040, with the global economy growing by an average of 3.5% per year during that time. Meeting this demand would require an overall investment of around US$10.5 trillion across upstream, midstream and downstream operations, it said.

In his introduction to the report, OPEC Secretary-General, Mohammad Barkindo, noted the 2017 outlook was more positive than last year, partly thanks to oil exporting nations’ efforts to stabilize the market.

"The past year has been an historic one for OPEC and the global oil industry," Barkindo said. "Since publication of the World Oil Outlook, in early November last year, the oil market has undergone significant change and transition. It has been a period where the rebalancing of the global oil market has gathered vital momentum, buoyed by a number of important factors."

However, while prospects for the industry are strong, the World Oil Outlook predicts demand for oil will grow more slowly than the overall demand for energy. Renewables will see the fastest rate of annual growth, at 6.8% per annum, although their overall share of the energy mix is only expected to reach 5.4% by 2040 due to their lower starting base.

"Alongside an ever-expanding global population and the critical importance of reducing energy poverty, these growth rates mean energy demand is expected to increase by close to 100 million barrels of oil equivalent a day between 2015 and 2040," Barkindo said. "OPEC is greatly supportive of the ongoing development of renewables and many of our member countries have vast solar and wind resources, with significant investments being made in these areas."

First published in 2007, the World Oil Outlook is one of OPEC’s flagship publications. It provides an in-depth review and analysis of the global oil industry, offering a thorough assessment of various trends and challenges in the medium and long-term development of the industry. This year marks the 11th edition of OPEC’s World Oil Outlook.


Qatar Sold Out of Winter Gas Supply

Gas exporting giant Qatar has all but sold out of winter supply after committing its spare output to China and South Korea, a development that could tighten Asia's gas markets as the peak demand season bites.

Doha's bumper sales will also ring alarm bells for other regions reliant on Qatari liquefied natural gas (LNG) such as Europe and may further boost Asian spot prices, which have already surged 55 % since September, traders said.

Despite widespread forecasts of an LNG glut, China's shift to gas this year as it moved millions of households away from coal to combat smog has lifted its LNG imports by 43 % and squeezed global gas markets.

But some traders are split on the sustainability of the rally, citing weather, crude oil price movements and the degree of residual demand left in China as big unknowns that could potentially dampen prices.

Normally Qatar plays the role of swing supplier to global LNG markets, churning out cargoes to cover demand spikes.

This time, Asian markets face a knife-edge balancing act as state-run Qatargas - catering to China, Japan and Europe - is booked out until April while peer Rasgas - covering South Korea, Taiwan and India - holds just a handful of free cargoes in February and March, trade sources and analysts said.

"If the winter is harsh then Asia will have to pay up to secure supplies and with new projects in Russia and the U.S. too delayed to provide much relief, prices will rise again," a senior LNG analyst at a major provider said.

Qatargas, in the process of absorbing Rasgas to create a single Qatari LNG player, did not reply to requests for comment.


A large part of China's surplus demand was filled by Qatar through fresh sales and even tweaks to existing long-contracts, according to trade sources and customs data.

The producer shipped 600 % more LNG to China in May from a year ago, 77 % more in June, 400 % more in July, 150 % more in August and 215 % more in September.

That trend should continue through the winter, traders said, as the GCC state adapts to long-term buyers' needs to hold on to its share of the prized Asian market.

Qatar also found buyers beyond China as rising coal and crude oil prices and nuclear supply shortfalls propped up spot LNG demand in India, Taiwan and South Korea, further emptying its shelves.


Qatar's absence from spot markets may be felt in higher LNG prices which some traders predict may hit three-year highs above US$11 per million British thermal units (mmBtu) this winter, from US$9.40 per mmBtu currently.

The shift in sentiment has bulls wondering whether forecasts of global LNG markets re-balancing in the early 2020s may not be wide of the mark given the quickening pace of Chinese consumption growth.

Bears urge caution, however, ahead of the imminent start-up of new liquefaction plants in the United States, Russia and Australia and the alternatives to LNG that Beijing has on offer.

For example, China's piped gas imports from Central Asia and Myanmar soared to a record 3.4 million tons in September, the latest month for which data is available and well ahead of the 2.5 million tons shipped in by tanker.

PetroChina is also near the limit on how much more LNG it can bring into its fully booked import terminals this winter, though peer CNOOC has room for maneuver, fuelling trader speculation of potential gas swaps if shortfalls emerge.

"My personal view is that China will remain quiet as they have already contracted the LNG they need," a trader said.


Rosneft Says to Invest in Egypt's Zohr in 2018-21

Russia's largest oil producer Rosneft will invest more than US$2 billion in Egypt's Zohr gas field in the next four years, the company said in a presentation on Tuesday. It also said the production plateau at the field, where Rosneft may increase its stake to 35%, is seen at 29 Bcm of gas a year.


ESCO Signs Service Agreement with Dubai Police

Etihad Energy Services Company, ESCO, has signed a service agreement with Dubai Police to provide energy efficient and sustainable solutions for its 34 facilities including police stations, prisons, and offices.

In accordance with the agreement, Dubai Police will go green with installation of a variety of green solutions. These measures will not only help save electricity and water, but also help reduce carbon emissions. In addition, Etihad ESCO will install solar PVs and undertake LEED audits for some of the Dubai Police facilities.

"We’re confident that our agreement with Dubai Police will not only assist them to reduce energy usage, but also facilitate access to new technologies and solutions for improving energy efficiency," said Ali Al Jassim, CEO of Etihad ESCO.

"Our collaboration with ESCO will forecast the future towards sustainable development and adopt small changes to daily routines to make sustainability our way of life. While we integrate sustainability throughout all levels of our organization, we ensure that we also monitor and benchmark best practices to remain committed to our goal of supporting Dubai Clean Energy Strategy 2050," said Lt Col Dr. Tamim Al Haj, Director of the Environment, Health and Safety Department at Dubai Police.


Omani Refinery to Commence Start Up Activities

Oman Oil Refineries and Petroleum Industries Company’s (Orpic) Mina Al Fahal Refinery ( Mina Al Fahal Site ) has commenced its startup operations on November 9, 2017 after a major turnaround, maintenance and project activities. The major turnaround started from October 3 for a period of 45 days and is planned to complete including start-up on November 16, 2017.

While Orpic’s key mission is to ensure that its operations run safely and reliably at all time, an increased level of flaring and noise can be expected during start-up activities for a couple of days. While minimizing the impact on the surrounding local community, Orpic relies on the community’s support and understanding during this period of start-up.


AAOIFI–World Bank Annual Conference Held in Manama

Under the auspices of the Central Bank of Bahrain, Bahrain has hosted the AAOIFI–World Bank annual conference in Manama where the participants discussed key topics.

Tawfeeq Mohammed Bastaki, Chief Risk Officer, Acting CEO of silver sponsors Khaleeji Commercial Bank (KHCB), confirmed the bank’s support of all efforts to support and promote the Islamic banking industry. He said, 'We are delighted to be one of the sponsors of this important conference. Our sponsorship and participation in the workshops reflect our continued commitment to supporting the initiatives and activities of Islamic banking institutions including AAOIFI, which aims to focus on Sharia-compliant finance issues and discuss key developments.

The conference touched on a number of important issues faced by the Islamic finance sector, which undoubtedly will substantially impact the operation of Islamic financial institutions,' he said.

Bastaki added 'The AAOIFI conference presents a great opportunity to meet the region’s Islamic financial institution leaders and employees, to discuss relevant issues including Sharia-compliance supervisory boards, products and services developed by Sharia-compliant banks to contribute to the growth and prosperity of the sector, thus benefiting from the combined efforts of those working in the field.'


Iran's Path to Becoming LNG Exporter

In the early 2000s, as Iran drafted ambitious plans to exploit its huge gas potential, allocating some of the gas for the production of liquefied natural gas (LNG) was firmly on its agenda. In fact, three projects were outlined: Pars LNG, a joint venture between Total (50%), the National Iranian Oil Company (NIOC, 40%) and Petronas (10%); Persian LNG, a joint venture between Shell (25%), Repsol (25%) and NIOC (50%); and Iran LNG, a company owned by NIOC with undetermined international partners. All three projects invested heavily in paving the way for the future production and export of LNG from Iran.

By the late 2000s, however, the international partners in the first two ventures were forced to abandon the projects given the intensification of nuclear sanctions against Iran. What remained was the third project, Iran LNG, and the frustration in Tehran that massive investments in the LNG sector had gone to waste. In fact, in light of the withdrawal of international companies and potential technology providers, Iran excluded any role for LNG in its subsequent gas sector strategy.

Developments in a number of fields have since compelled Iranian petroleum sector strategists to reconsider and take a more serious look at LNG. The factors contributing to the shift in strategy include the following:

- Growth in gas production: Iran’s actual gas production and potential for exports have increased substantially, allowing the country to plan for major export activity.

- Availability of Western technology: The lifting of nuclear sanctions has made it feasible for Tehran to again secure the needed technologies and equipment to construct LNG complexes.

- Demand outlook for LNG: The growth projection for LNG is such that global demand will grow by 50% in 2020 compared with demand in 2014.

- Changing geostrategic realities: Qatar is Iran’s most significant competitor in the global LNG market, and an improvement in relations between them in the aftermath of the Saudi-led blockade against

- Qatar has paved the way for a more pro-active LNG strategy in Iran.

- Commitment to stop the flaring of gas: Tehran envisions a total ban on flaring gas in the South Pars Gas Field by 2020, a process that can be facilitated through converting some of the freed gas to LNG through so-called floating LNG (FLNG) capacity.

The first steps in the shift have already been taken. Tehran signed an agreement with Oman to export Iranian gas to Oman via pipeline and then to use excess capacity in Oman to produce LNG. This first step was designed to put Iran, as a small player, on the global LNG map. The second step was taken when Tehran signed an agreement with the Norwegian company Helma Vantage to provide it with FLNG capacity. The advantage of an FLNG facility is that it can be shifted if gas supply locations change due to the flow of projects. This means that a floating LNG unit can be installed depending on where new sources of gas become available. In the meantime, Total SA, the French company that signed the SP Phase(s) 11 agreement with Tehran in July, is in talks with Iran to acquire Iran LNG, mentioned above.

These are all important steps that will gradually increase Iran's potential to produce and export LNG. Iran has competitive advantages to move it in the direction of becoming a significant player in the LNG market, including its gas resources and geostrategic position. Also, Iran has an affinity for major markets in Europe and Asia. Meanwhile, Iran appears to be taking the right approach in creating LNG capacities at a gradual pace rather than trying to jump into large-scale production. Nonetheless, a number of challenges will need to be addressed before Iran can become a substantial player in the growing global LNG market.

First and foremost, LNG technology is potentially one of the technological sectors most vulnerable to US pressure. In other words, even though non-US providers of LNG technology exist, some components are only US made. Tehran needs to be careful to avoid a new wave of pressure due to unilateral US sanctions on transfers of technology.

Second, unlike the international crude oil market, which Tehran knows quite well, the global gas market is driven by buyers rather than sellers. LNG exports have to be decompressed at their destination, meaning that additional infrastructure is required at the receiving end of the export process. LNG exports also require specialized tankers for international transport, so Iran must invest in new capacity for its tanker fleet. Though Iran has had experience with pipeline gas exports to neighboring countries, it is important to realize that LNG exports are different and that human resources, infrastructure and commercial capacities must be developed to benefit from the LNG potential.

Third, economic comparisons between pipeline gas exports and LNG exports need to become more sophisticated. Some experts in Iran argue that it could more feasibly export gas to distant markets via pipeline. While their economic calculations may be quantitatively correct, they fail to take into account some of the non-quantifiable counter-arguments, such as the geopolitical risks to pipelines, including terrorism. In fact, the decades-long failure to plan and construct an Iranian gas pipeline to India is the best proof of such complexities.

Fourth, there will be some domestic opposition to the future development of LNG among forces that believe the best form of gas export for Iran is the production and exportation of electricity. This constituency is strong and also presents valid arguments, such as the fact that Iran has indigenous electricity generation technologies and that there are enough current and future regional markets for electricity exports. Given that Iran has the world’s largest gas reserves, however, Iranian strategists should grasp that the country has enough gas resources to become a key player in all these markets.

The above outline underlines the potential of future Iranian LNG exports and also points to the challenges along this path. The key element in drafting and implementing the appropriate strategy is to first develop a comprehensive energy vision for the country. Once such a document exists, everyone will know what share of resources will be allocated to each sector, and more meaningful sectorial planning can flow from there. In the meantime, Tehran will gradually appear on the LNG map, in incremental steps. - Al Monitor


Muscat-Based ARA Petroleum Eager to Grow Portfolio

ARA Petroleum LLC, which made its debut in Oman’s upstream sector last year with the acquisition of Block 44 from Thailand’s PTTEP, has ambitions to grow internationally, according to the company’s Chief Executive Officer. Sultan al Ghaithi said the company, which signed an Exploration & Production Sharing Agreement (EPSA) with the Ministry of Oil & Gas for Block 31 onshore Oman, already has indirect oilfield investments outside the Sultanate, and is also undertaking a key service contract for Petroleum Development Oman (PDO) covering a field in central Oman.

“We want to be a stronger player here in the Sultanate,” Al Ghaithi said. “Having a local setup will allow us to go to the international market as well.” ARA’s newest acquisition — the 8,528 sq km Block 31 in the northwest of the Sultanate — is located adjacent to Block 44, a feature that was key to its bid for this concession, said the CEO. “It makes it more economical for us in the case of a discovery. Besides, it will be much easier to use existing the infrastructure to accelerate production of the field when a discovery is made. Also, when you look at the subsurface, we have the same team that handled (Block 44), so the knowledge can be shared. It will be much easier for one team to handle the whole thing. But at the end of the day, commerciality is the most important thing; it’s key for us to get into this block.”

Aside from its investments in Blocks 44 and 31, ARA Petroleum is also undertaking a Service Contract for PDO covering the exploration and development of Qarat al Milh, a small field near Qarn Alam in central Oman. “This contract requires a lot of investment because of the amount of activity there – we have 12 discoveries and we have to develop them faster than anywhere else,” said Al Ghaithi. Additionally, the company is also focused on building a development plan for the Shams field in Block 44. “There are some oil discoveries that we are looking to accelerate as well. Hopefully, by the middle of next year, we will start major activities, like drilling some wells to boost production.” Output from Shams currently averages 16 million standard cubic feet of gas per day, in addition to 700 bpd of oil.