CERAWeek Diary: Across the bridge, a real piece of Saudi tech in Houston fantasy land

US Senator Joe Manchin (D-WV), speaks with reporters about US energy policy and climate change at the IHS Markit CERAWeek conference in Houston, Texas. (Reuters)
Updated 14 March 2019
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CERAWeek Diary: Across the bridge, a real piece of Saudi tech in Houston fantasy land

  • The first thing that greets you is straight out of Ad Diriyah — an awesome-looking racing car complete with Saudi Aramco speed flashes and tail-fins you could build a garden patio on
  • Wedged into a corner is another Aramco-badged vehicle — a Ford F-150 pick-up truck, fitted with the company’s revolutionary gasoline compression ignition engine

HOUSTON: Take a trip across the “skybridge” from the Hilton Americas hotel to the George R. Brown Convention Center in downtown Houston, and you are in a different world. Is it Saudi Arabia? Is it ancient Rome? Is it the depths of the Permian Basin? It’s all very confusing.
The bridge — really just a third-floor walkway with views over the pleasant greenery of central Houston — links the CERAWeek by IHS Markit energy forum with its hip overspill area, the Innovation Agora.
It also contains the Lyceum Workshops interactive program; with all these classical allusions you might expect to find a crowd of toga-clad sybarites reclining in the vomitorium, plucking lyres and demanding their grapes be peeled.
But not many Texans are like that, in my experience. Those here settled instead for chicken satay and peanut sauce canapes.
The first thing that greets you is straight out of Ad Diriyah, near Riyadh — an awesome-looking racing car complete with Saudi Aramco speed flashes and tail-fins you could build a garden patio on. It is a vehicle from the Kingdom’s recent Formula E event, and would turn many heads, even in Houston’s bling-laden Avenida.
Take a stroll around and you will find another example of the Kingdom’s high-tech prowess. Wedged into a corner is another Aramco-badged vehicle — a Ford F-150 pick-up truck, fitted with the company’s revolutionary gasoline compression ignition engine, designed for more efficient and cleaner motoring. One Agoran asked: “How did they get it parked there?”
Close by is the Aramco “partner house,” a corporate space given over to strategic partners of CERAWeek, which the Saudi energy giant has been for years. Bathed in Aramco’s company colors of blue and green, you marvel at wireless sensors the size of golf balls, anti-corrosion technology, jars of Saudi sand used in hydraulic fracturing — better than US sand apparently — and new zeolites, chemical catalysts that help in the oil “cracking” process. These are all examples of the Kingdom’s cutting-edge energy technology.
But the most surreal part of the Agora experience still awaits you, in the partner house occupied by Emerson, the engineering company based in Missouri but increasingly active in Saudi Arabia. There, men in suits and hard hats take you on a simulated journey through the Permian oil production process, from extraction through pipelining to refining and power generation.
Emerson employees bounce around excitedly explaining the joy that the company’s technology and digital data systems have brought to their lives. In a boiler suit and hard hat, Mo tells how she doesn’t have to worry that pipes will get corroded any more because she can monitor them real-time from Emerson consoles; Megan enthusiastically expounds the pleasure she now gets out of managing her fleet of power stations, thanks to the same equipment.
Surely these people are all actors — nobody could be naturally that happy about the dirty work of fracking and shipping shale oil?
But Mike Train, president of Emerson Automation Solutions and certainly no thespian, explains how the company’s technology really is a game-changer in the digital transformation going on in the global energy business.
It is a big thing, too, in Saudi Arabia, where Emerson last year opened a facility in the Dhahran Techno Valley in the Eastern Province, part of the company’s growing operations in the Kingdom.
Train is looking for Saudi employees, women in particular, to beef up Emerson’s business there, and will coach newcomers in the cutting-edge processes the company pioneers. It sounds like a good offer for any young potential Saudi Agorans.
Back across the skybridge, on the escalators of Hilton Americas hotel, the memory of the Innovation Agora instantly assumed the status of fantasy. Had it all been a dream? The peanut sauce stain on my shirt was the only evidence it had been real.


Pakistani central bank lifts interest rate as inflation bites

Updated 20 May 2019
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Pakistani central bank lifts interest rate as inflation bites

ISLAMABAD: Pakistan’s central bank raised its key interest rate to 12.25% on Monday, warning that already soaring inflation risked further rises on the back of higher oil prices and reforms required for a bailout from the International Monetary Fund.
The 150 basis points increase follows a preliminary agreement last week with the IMF for a $6 billion loan that is expected to come with tough conditions, including raising more tax revenues and putting up gas and power prices. It was the eighth time the central bank has increased its main policy rate since the start of last year.
With economic growth set to slow to 2.9% this year from 5.2% last year, according to IMF forecasts, the rate rise adds to pressure on Prime Minister Imran Khan, who came to power last year facing a balance of payments crisis that has now forced his government to turn to the IMF.
Higher prices for basic essentials including food and energy has already stirred public anger but the central bank suggested there was little prospect of any immediate improvement.
Noting average headline inflation rose to 7% in the July-April period from 3.8 percent a year earlier, the central bank said recent rises in domestic oil prices and the cost of food suggested that “inflationary pressures are likely to continue for some time.”

 

It said it expected headline inflation to average between 6.5% and 7.5% for the financial year to the end of June and was expected to be “considerably higher” in the coming year. Expected tax measures in next month’s budget as well as higher gas and power prices and volatility in international oil prices could push inflation up further, it said.
It said the fiscal deficit, which the IMF expects to reach 7.2% of gross domestic product (GDP) this year, was likely to have been “considerably higher” during the July-March period than in the same period a year earlier due to shortfalls in revenue collection, higher interest payments and security costs.
Despite some improvements, financing the current account deficit remained “challenging” and foreign exchange reserves of $8.8 billion were below standard adequacy levels at less than the equivalent of three months of imports.
The central bank said it was watching foreign exchange markets closely and was prepared to take action to curb “unwarranted” volatility, after the sharp fall in the rupee over recent days that saw the currency touch a record low of 150 against the US dollar.
Details of what Pakistan will be required to do under the IMF agreement, which must still be approved by the Fund’s board, have not been announced but already opposition parties are planning protests.
As well as higher energy prices that will hit households hard, there are also expectations of new taxes and spending cuts in next month’s budget to reach a primary budget deficit — excluding interest payments — of 0.6% of GDP.
With the IMF forecasting a primary deficit of 2.2% for the coming financial year, that implies squeezing roughly $5 billion in extra revenues from Pakistan’s $315 billion economy, which has long suffered from problems raising tax revenue.

FACTOID

Pakistan’s economic growth is set to slow to 2.9% this year.