Kingdom to allocate SR67bn for saline water projects

Updated 04 March 2014
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Kingdom to allocate SR67bn for saline water projects

Saudi Arabia plans to allocate some SR67 billion toward the building of water desalination plants by 2020 in a bid to meet the rising demand of consumers, Asharq Al-Awsat daily said.
In this regard, Saline Water Conversion Corporation (SWCC) Gov. Abdulrahman bin Mohamed Al-Ibrahim has stressed the importance of building highly-efficient and less-fuel consuming water projects.
The desalination water plants in the Kingdom is the second largest fuel consuming sector using up to 300,000 barrels of oil a day. “It is a matter of grave concern for the experts at the SWCC and nationwide,” the media said.
The SWCC chief said the Ministry of Petroleum and Mineral Resources, the Ministry of Water and Electricity, and the Ministry of Finance are set to launch a series of highly fuel-efficient water and power projects.
This drive will raise the efficiency of the newly-approved plants to 70 percent as is the case with the projects currently being implemented in Ras Al-Khair and Yanbu, he said.
Mohamed Al-Ghamdi, SWCC deputy governor for operations and maintenance, said the SWCC had invested SR4 billion ($1.07 billion) in the rehabilitation of the existing water saline projects, which has extended their life span by 10 years.
Saudi Arabia has been producing roughly 20 percent of the world’s total saline water production. The SWCC covers 60 percent of the Kingdom’s total water needs through its plants spread over the eastern and western coasts of the Kingdom, he added.
Al-Ghamdi said the SWCC has entered into partnerships with the private sector through two mega projects — the Shuaiba water and electricity project and the Shaqiq Plant to produce nearly one million cubic meter desalinated water.
The SWCC has carried out three renovation plans for a period of five years each. The plans were implemented in 2000 and are expected to finish in 2015, where the renovation efforts will increase the life span of the plants to more than 15 years, he pointed out.


OPEC cut ‘biggest in almost 2 years’

Updated 44 min 19 sec ago
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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.