SR36bn deals signed to develop Waad Al-Shamal Industrial City

Updated 20 May 2014
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SR36bn deals signed to develop Waad Al-Shamal Industrial City

Agreements worth SR36 billion were signed on Tuesday to develop Waad Al-Shamal Industrial City in the north, which is named after Custodian of the Two Holy Mosques King Abdullah, and establish a number of industrial projects.
Northern Border Province Gov. Prince Abdullah bin Abdul Aziz bin Musaed, Minister of Petroleum and Mineral Resources Ali Al-Naimi, Finance Minister Ibrahim Al-Assaf and Water and Electricity Minister Abdullah Al-Hussayen attended the event.
Saudi Arabian Mining Company (Maaden) signed an agreement with the Canadian company SNC Lavalin and Chinese Sinopec to establish a sulfuric acid plant in the city. It signed another contract with China Huanqiu Contracting & Engineering Corp. to build an ore beneficiation plant.
Maaden also signed an agreement with South Korea's Hanwha Engineering & Construction Co. to build a phosphoric acid plant at a cost of SR3.5 billion. The plant will have a production capacity of 1.5 million tons.
Maaden also signed a deal with a Korean company to set up an ammonia plant, and another deal with a Spanish company to establish a phosphoric fertilizer plant, an official statement said.
Other agreements were to construct the main road to the city, establish a transformer, build a power supply line and set out technical specifications for an electricity power plant. The Saudi Ports Authority signed a contract to build a wharf at Ras Al-Khair Port.
Finance Minister Al-Assaf signed a deal with a specialized company to provide consultancy services for building a railway line linking Waad Al-Shamal city with Ras Al-Khair Port and Jubail Industrial Port.
Deals were also signed between Saudi Aramco and Maaden and the Ministry of Petroleum and Minerals with the Ministry of Water and Electricity.
Speaking to reporters after the signing ceremony, Prince Abdullah said the new projects would create more job opportunities for citizens and enhance their welfare. He thanked King Abdullah for his support for Waad Al-Shamal industrial city project.
In a similar statement, Al-Naimi said the project was planned as part of the government’s efforts to diversify revenue sources. “Total investments in industries and other projects in the city will cross SR36 billion,” he said.
Al-Assaf, who is also chairman of Public Investment Fund, said the new projects would help sustainable development in the region. “It will create a strong base for economic development and promote the progress and prosperity of citizens.”
Maaden previously awarded two contracts; one for general engineering plan and infrastructure services for the city and the second for providing engineering designs and management services for the  phosphate project.
 The first contract was awarded to Bechtel Company, which will prepare the general engineering plan of the city including basic, downstream and support industries. It will also carry out plans for commercial, housing and educational facilities.
The second contract was awarded to Jacobs Company, which will provide engineering designs and management services for the phosphate project.
Maaden's President and CEO Khalid Mudaifer said the contracts were considered basic steps for the implementation of the city.
 Maaden plans to invest SR26 billion for the establishment of a mega phosphate industry complex of which SR21 billion has been earmarked for setting up 7 projects in Waad Al-Shamal City for Mining Industries.


OPEC cut ‘biggest in almost 2 years’

Updated 18 January 2019
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OPEC cut ‘biggest in almost 2 years’

  • OPEC said in a monthly report its oil output fell by 751,000 barrels per day (bpd) in December to 31.58 million bpd
  • OPEC expects 2019 global oil demand growth to slow to 1.29 million bpd from 1.5 million in 2018

LONDON: OPEC said on Thursday it had cut oil output sharply in December before a new accord to limit supply took effect, suggesting producers have made a strong start to averting a glut in 2019 as a slowing economy curbs demand.
The Organization of the Petroleum Exporting Countries said in a monthly report its oil output fell by 751,000 barrels per day (bpd) in December to 31.58 million bpd, the biggest month-on-month drop in almost two years.
Worried by a drop in oil prices and rising supplies, OPEC and its allies, including Russia, agreed in December to return to production cuts in 2019. They pledged to lower output by 1.2 million bpd, of which OPEC’s share is 800,000 bpd.
The reduction in December means that should OPEC fully implement the new Jan. 1 cut, it will avoid a surplus that could weaken prices. Oil slid from $86 a barrel in October to below $50 in December on concerns of excess supply.
OPEC expects 2019 global oil demand growth to slow to 1.29 million bpd from 1.5 million in 2018 although it was more upbeat about the economic backdrop than last month and cited better sentiment in the oil market, where crude is back above $60.
“While the economic risk remains skewed to the downside, the likelihood of a moderation in monetary tightening is expected to slow the decelerating economic growth trend in 2019,” OPEC said.
“This has recently been reflected in global financial markets. The positive effect on market sentiment was also witnessed in the oil market,” it said.
The supply cut was a policy U-turn after the producer alliance known as OPEC+ agreed in June 2018 to boost supply amid pressure from US President Donald Trump to lower prices and cover an expected shortfall in Iranian exports.
OPEC changed course after the slide in prices starting in October. A previous OPEC+ supply curb starting in January 2017 — when OPEC production fell by 890,000 bpd according to OPEC figures — got rid of a glut formed in 2014-2016.
In a sign of excess supply, OPEC’s report said oil inventories in developed economies had stayed above the five-year average in November.
The biggest drop in OPEC supply last month came from Saudi Arabia and amounted to 468,000 bpd, the survey showed.
Saudi supply in November had hit a record above 11 million bpd.
The Kingdom told OPEC it lowered supply to 10.64 million bpd in December and has said it plans to go even further in January by delivering a larger cut than required under the OPEC+ deal.
The second-largest was an involuntary cut by Libya, where unrest led to the shutdown of the country’s biggest oilfield.
Output from Iran posted the third-largest decline, also involuntary, as US sanctions that started in November discouraged companies from buying its oil.
Iran, Libya and Venezuela are exempt from the 2019 supply cut deal and are expected by some analysts to post further falls, giving a tailwind to the voluntary effort by the others.
OPEC said in the report that 2019 demand for its crude would decline to 30.83 million bpd, a drop of 910,000 bpd from 2018, as rivals pump more and the slowing economy curbs demand.
Delivering the 800,000 bpd cut from December’s level should mean the group would be pumping slightly less than the expected demand for its crude this year and so avoid a surplus. Last month’s report had pointed to a surplus.
The figures for OPEC production and demand for its crude were lowered by about 600,000 bpd to reflect Qatar’s exit from the group, which now has 14 members.