Oiling the growth engine
Abu Dhabi:, December 2, 2007
Oil and gas are often said to be the nerve of life on our planet these days. This is particularly true when we consider the economy of the UAE.
The oil and gas sector provides around a third of the UAE's gross national product (GNP), thanks to the diversification of the economy. However, this sector still remains a dominant generator of government revenues, which ultimately contribute substantially to the country's modernisation and development drive.
The country, which turned 36-year-old on December 2, 2007, holds the fifth largest proven oil reserves in the Middle East and the fourth largest proven natural gas reserves in the world.
The UAE, which is a member of the Organisation of the Petroleum Exporting Countries (Opec) since 1967, hosted the UAE hosted group’s 146th extraordinary conference in Abu Dhabi at a time the oil market and global economy was in a critical stage with oil prices hitting close to $100 per barrel.
UAE's oil reserve is estimated at about 98.1 billion barrels, which is about 8.1 per cent of the world's oil reserve, while the country's gas reserve is also estimated at about six trillion cubic metres.
The UAE current oil output stands at 2.7 million barrels per day, while its gas output is at 65 billion cubic metres per annum.
UAE's oil output is expected to rise to 3.5 million barrels per day at the beginning of next decade. Its oil refinery capacity, which currently stands at 600,000 barrels per day, is expected to rise to 1.1 million barrels per day in the near future.
The Abu Dhabi National Oil Company (Adnoc) has disclosed a plan to increase its crude oil output. The company said despite the fluctuation on the world oil market demand for oil continues to rise. Therefore, it is planning to increase production steadily to meet the growing demand.
Abu Dhabi's is set to increase its gas production in the next few years to make it one of the world's major exporters of gas.
Adnoc recently disclosed that a bid had been invited for the laying of the first gas pipelines from Das Island to the Habshan onshore storage facility which can take-in 220 million cubic feet in phase 1 and an additional 500 million cubic feet in phase 2. This is happening at a time when work has already started on the expansion of the Gasco gas industry capacity to be able to meet the increase in crude lubricant production from the oil fields in the years ahead.
Adnoc, which has invested about $7 billion in gas industry projects of Gasco, said the projects would be completed soon to allow production to start in 2008 and 2009.
Meanwhile, the Abu Dhabi Gas liquefaction Company (Adgas) has awarded in November 2007 a $613 million contract to the International Middle East Projects Company, a company that is fully owned by the Technip Company of France.
Based on the contract, Technip will execute phase 1 of the offshore associated gas processing plant on Das Island. The associated gas will be transported to the Habshan onshore field plant for processing and supply for the local market.
The Ruwais Fertiliser Industries (Fertil) has also signed an agreement with the Pakistan-based Discon Engineering Company and the Urea Castle Company of Switzerland for the expansion of the Ruwais Urea industry at a total cost of $240 million. Based on the agreement the Pakistan-based company will be responsible for the engineering, procurement, building and fixing works on the project, while the Swiss company will provide the necessary technology for increasing the production capacity of the company.
Dolphin Energy delivered to its clients in the UAE the first gas supply from its production source in Qatar in July. Dolphin is currently producing crude gas at its project site in Qatar’s Tatweer area at the Al Shamal field. The company processes the gas at its big processing plant in Ras Lafa