QFIB reaches out to Saudi shareholders

Updated 06 March 2013

QFIB reaches out to Saudi shareholders

The Saudi economy is expected to register a growth of between 4 percent and 4.4 percent in 2013 on the back of high oil prices and government spending.
This was indicated during a meeting of the board of directors of Qatar First Investment Bank (QFIB) in Dammam on Sunday. The meeting took note of the fact that Saudi Arabia has set a record state budget valued at $ 218.7 billion to stimulate and enhance the non-hydrocarbon sectors including construction, health care, education and financial services.
The QFIB board meeting was chaired by Abdullah Fahad Ghorab Al-Marri and included leading Saudi businessman and QFIB Vice Chairman Ibrahim Mohamed Al-Jomaih and QFIB CEO Emad Mansour.
Prominent Saudi businessmen and CEOs of top companies were invited to a business meeting at the Dammam Sheraton after the board confab.
QFIB is the first independent Shariah-compliant bank regulated by Qatar Financial Center Regulatory Authority.
The meeting in Dammam was part of the bank's scheduled board meetings that is held every year in a different Gulf Cooperation Council (GCC) country in order to reach out to the its diversified base of shareholders.
"Saudi Arabia is an important market for us. It has a steady and stable economy. We like to join competitive markets to help us thrive and expand our business," Al-Marri told Arab News.
According to Al-Marri, Dammam is important because of its close proximity to Dhahran which houses the world's leading oil and gas company Saudi Aramco. "QFIB takes a special interest in the oil and gas sector as it is the backbone of the GCC economies," said Al-Marri. "To date, QFIB has invested over 400 million Qatari riyals in this vibrant sector."
He reiterated that Saudi Arabia is the world's top oil-producing country with a production of 11,150,000 barrels/day contributing around 12.9 percent of the world's total oil production. Moreover, it has 20 percent of the world's oil reserves standing at 265 billion barrels which puts the Kingdom at top of the world's oil-exporting countries.
Al-Jomaih told Arab News that the Saudi market has a very positive outlook. "We hope this meeting will bring QFIB closer to potential investors in Saudi Arabia," he said. "Our role as board members is to support the management in promoting the bank."
Al-Marri underlined great opportunities in the real estate sector in the Eastern Province. The focus of businesses will be on this region because of its closeness to Qatar.
"Since Qatar will host the landmark World Cup 2022, it will require large-scale projects. Qatari companies alone cannot carry out these large-scale projects. Saudi companies will have to join and some of the Saudi companies have already won many of these large-scale projects in different fields," said Al-Marri.

Exxon faces setback in Iraq as oil and water mix

Updated 20 April 2018

Exxon faces setback in Iraq as oil and water mix

  • Exxon’s talks with Iraq on water project hit problems
  • Losing the contract could deal a blow to Exxon’s broader Iraqi plans

LONDON: Talks between Exxon Mobil and Iraq on a multibillion-dollar infrastructure contract have reached an impasse, Iraqi officials and two industry sources said, in a potential setback to the oil major’s ambitions to expand in the country.

More than two years of negotiations on awarding the US firm a project to build a water treatment facility and related pipelines needed to boost Iraq’s oil production capacity have hit difficulties because the two sides differ on contract terms and costs, the officials and sources told Reuters.

Unless the differences can be resolved, the project could be awarded to another company in a tender, the officials said, without elaborating on the points of dispute.

Losing the contract could deal a blow to Exxon’s broader Iraqi plans, as it would be handed rights to develop at least two southern oilfields — Nahr Bin Umar and Artawi — as part of the deal.

Exxon declined to comment.

Further delays to the project could also hold back the oil industry in Iraq, OPEC’s second-largest producer; the country needs to inject water into its wells or risk losing pressure and face severe decline rates, especially at its mature oilfields. As freshwater is a scarce resource in Iraq, using treated seawater is one of the best alternatives.

The Common Seawater Supply Project (CSSP), which would supply water to more than six southern oilfields, including Exxon’s existing West Qurna 1 field and BP’s Rumaila, was initially planned to be completed in 2013 but has now been delayed until 2022.

“The CSSP would be expensive and challenging but there’s opportunity here (for Exxon) ... to get access to resources on a very large scale and to achieve something and really make a difference to its own business,” said Ian Thom, principal analyst at consultancy Wood Mackenzie.

Many of the world’s biggest oil companies, such as BP, Total, Royal Dutch Shell and Eni, have operations in Iraq, where a low-return environment and strict contract terms have squeezed returns in recent years.

With total oil production at West Qurna 1 at around 430,000 bpd, Exxon’s presence in Iraq is small compared with dominant player BP whose Rumaila oilfield accounts for around a third of the country’s total production of about 4.4 million bpd.

While the Texas-based firm is looking to grow in Iraq, its geographical focus remains on the Americas, including US shale fields and Brazil, in contrast to rivals such as France’s Total and Italy’s Eni who have been significantly expanding their activities in the Middle East in recent years.

The talks between Iraqi authorities and Exxon are still ongoing, according to the industry sources and officials from the Iraqi oil ministry.

However the state-run Basra Oil Company (BOC), which is overseeing the project, said it could now tender the project this month in a parallel process with the aim of completing a first phase by 2022.

“We have this one approach but we can have another approach as well,” Abdul Mahdi Al-Ameedi, head of the Iraqi oil ministry’s licensing and contracts office, told Reuters.

Iraq chose Exxon to coordinate the initial studies of the CSSP in 2010. At the time, Baghdad aimed to raise its oil production capacity to 12 million barrels per day (bpd) by 2018, rivalling Saudi Arabia. That target has been missed and been cut to 6.5 million bpd by 2022 from around 5 million bpd now.

Negotiations with Exxon fell through in 2012 due to red tape and cost disputes. In 2015, the company re-entered talks with the oil ministry, this time in partnership with China’s CNPC and with the CSSP folded into a much bigger development project known as the Integrated South Project. 

CNPC did not reply to a request for comment.

For Iraq, going down the non-Exxon route raises two major concerns: How to integrate the project between the water treatment facility and the oilfields and how to finance the project, Thom said.

Two Iraqi oil sources told Reuters that taking the non-Exxon path would raise financing concerns for Iraq.

Projected costs of the scheme have not been disclosed, but engineering studies have put the cost of treating 12.5 million bpd of seawater transported to six oilfields at $12 billion.

The capacity has been revised downwards, with the first phase set to have a 5 million bpd of water, and in the second phase an additional 2.5 million bpd of water will be added for additional fields.