RIYADH, 16 May — The investments in gas and related projects will lead to the diversification of the Kingdom’s economic base, according to a top official of the Conoco Arabia Inc.
Conoco Arabia Inc. President J. Brooks Buxton expected investments exceeding $45 billion in the three proposed gas projects by foreign investments in the next 10 years.
“These projects with their accompanying economic and industrial activities will, undoubtedly, convert Saudi Arabia, into an investment hub supplying the local demands for power in full,” the president said. Side by side with development of gas projects, the supply network will also develop to carry the gas inside and outside the Kingdom, he said.
“Conoco Arabia’s entry into this Saudi project will be a foundation for the new phase in its partnership with the Kingdom and we will work to achieve a leading position for the Kingdom.”
Buxton, who has been working in the Kingdom for the last 40 years, said the international gas companies should invest directly in various key developmental sectors. “This will help achieve the Saudi economic strategy of diversifying the economic base, changing the current petroleum-dominated economic equation and developing the infrastructure for overall industrial development.” The reduced emphasis on petrol is the driving principle which makes the government interested in the participation of international majors in gas projects, he added.
He revealed that Conoco planned to invest $5 billion directly in the early stages of the work on the project with close cooperation with the Saudi private sector.
“I believe that the amount of investment will triple as the projects need continuous update of technology, expansion of the base and production lines as well as additional investment in the manpower training programs,” the president said.
He also expected to increase his company’s budget allocated for the Saudi Arabian projects several times in the next five years so as to meet the increasing needs of company’s other support projects.
He also said the local banking sources would be capable of providing the financial support for the vast development in the Saudi power sector and providing employment opportunities for young Saudis. A favorable climate for industrial and economic investments will also guarantee the return of the huge investments going out of the country, the chief executive of Conoco noted.
Conoco has drawn up a special scheme to train the local manpower for advanced technical jobs. The scheme is currently being implemented in other nations such as Russia, Venezuela, and Libya where the company has huge investments. The scheme will train the local hands who will man 75 percent of the jobs.
A distinguishing feature of the Saudi projects is that they are based on a strong industrial foundation with cheap energy sources and raw materials. The projects will enable the Kingdom to supply power for local needs at a lower price.
The projects will also enable the Kingdom to meet the energy needs of the neighboring Gulf countries at a competitive price and later of the distant countries of Syria, Jordan and Lebanon.
Apart from diversifying and reinforcing the economic base, the abundance of energy will, apparently, attract both local and international investments to the Kingdom, he observed.
