Saudi Aramco ‘on way to becoming gas powerhouse’

Saudi Aramco ‘on way to becoming gas powerhouse’
Liquefied natural gas storage tanks at an oil refinery. Global expenditure on upstream gas is set to grow to $1.13 trillion by 2025, according to analysts. (Shutterstock)
Updated 12 November 2018

Saudi Aramco ‘on way to becoming gas powerhouse’

Saudi Aramco ‘on way to becoming gas powerhouse’

LONDON: Saudi Aramco has outlined to Arab News how it plans to massively ramp up its multibillion-dollar natural gas business, both in the Kingdom and overseas, as gas gradually replaces coal and oil in global power generation.
Gas is viewed as a cleaner energy source than coal or oil in power stations, and there is soaring demand in Asia.
“Gas is already a large global business and is expected to be among the fastest-growing fuels (60 percent growth) over the next quarter-century. And LNG (liquefied natural gas) is expected to make up almost half of global gas trade over the same period,” Aramco said in a statement.
“We already produce about 14 billion standard cubic feet (bscfd) of gas, which is on the road to being expanded to 23 bscfd, which will increase our share of cleaner gas in domestic utilities from the current 55 percent to 75 percent, the highest in G-20.
“When combined with our move toward international gas business, Saudi Aramco is on the way to becoming a gas powerhouse in addition to its huge strength in oil.”
Aramco said that bolstering its position in the global gas and LNG business would “strengthen our competitive advantage, and diversify operations.”
Aramco this year signed a memorandum of understanding with Royal Dutch Shell to jointly pursue global gas business opportunities, including upstream development, liquefaction projects and other aspects of the gas value chain.
According to classification society DNV GL’s latest Energy Transition Outlook, by 2025 expenditure on upstream gas will grow to $1.13 trillion.
Saudi Arabia’s gas expansion is set to free up more oil for export, boosting national revenue and potentially opening up new areas for employment, said Iman Nasseri, a managing director at London-based consultancy FGE.
Jim Henderson, an expert in Middle Eastern energy and geopolitics at the Oxford Institute of Energy Studies, said: “Lifting the amount of oil for export is part of an approach that aims to have as much oil available for sale overseas in order to more effectively manage global demand for crude.”
Aramco’s gas exploration efforts have resulted in finding big volumes of shale gas in the Jafurah Basin in southeastern Saudi Arabia. “They are highly promising quantities and economically feasible as they contain a high rate of liquids; activities to evaluate the reserves are ongoing,” said Aramco.
“Unconventional gas contribution will reach to 15 percent of the total gas production of 23 billion bscfd per day in the gas program over the next 10 years.”
Aramco views shale as a “strategic investment” that would help to further supplement “our vast conventional gas resources.” It would be used for domestic utilities and fuel, as well as feedstock “for our industries, including petrochemicals.
The Kingdom’s LNG story has highlighted the evolving Saudi-Russia energy alliance. Speaking on the sidelines of a recent investment summit in Riyadh, Energy Minister Khalid Al-Falih said the Kingdom aimed to acquire 30 percent of Russian gas producer Novatek’s $21 billion liquefied natural gas project in the Arctic.
In 2016, OPEC and Russia struck an agreement to cut crude production following a build-up in inventories that led to a price slump.
Asked how important LNG investment overseas was for Aramco, the company said: “Saudi Aramco aims to diversify operations and expand our international gas business. We’re committed to increasing production capacity to take advantage of opportunities resulting from increased use of gas — both as an energy source and as a feedstock for the chemicals industry.”
Trevor Sikorski, head of natural gas and carbon research at consultancy Energy Aspects in London, told Arab News: “By taking equity stakes in LNG operations, they would cover the possibility of rising prices via a capital investment, rather than through contracts that could expose them to price fluctuations going forward.”
Aramco’s recent worldwide oil-refinery investments in countries such as Malaysia give it a presence in a region where it could market LNG from places such as Russia, said Robin Mills, CEO of Dubai-based Qamar Energy.
He told Arab News: “(Aramco sees) Asia as at the heart of gas and oil demand growth.”
Geraldine Duffour, of France-based energy research firm Enerdata, said: “Since 2000, Saudi Arabia’s energy demand has more than doubled.”
She added: “As Saudi Arabia is keeping its domestic oil production for exports, gas has been increasingly used in the power sector (from 46 percent of power generation in 2000 to 59 percent in 2017) and total gas consumption has been rising by around 6 percent per year since 2000.”
In 2016, Aramco announced plans to double gas production within 10 years, and to develop Saudi gas fields, including shale deposits.
Al-Falih said at the India Energy Forum in New Delhi last month that Aramco was open to the idea of marketing some LNG from the proposed Russian Arctic LNG 2.
OilPrice.com reported Al-Falih as saying: “We have looked at projects in Africa and the Mediterranean, and, of course, the Arctic with some Russian companies. The idea is that Aramco will trade (LNG) globally and bring some to India and other markets.” 


New center to lead Saudi role in ‘4th industrial revolution’, economic minister says

New center to lead Saudi role in ‘4th industrial revolution’, economic minister says
Updated 29 July 2021

New center to lead Saudi role in ‘4th industrial revolution’, economic minister says

New center to lead Saudi role in ‘4th industrial revolution’, economic minister says
  • The Saudi minister said the new center will contribute to global discussions on the use of 4IR technology, such as 5G and artificial intelligence

DUBAI: The Saudi Centre for the Fourth Industrial Revolution (4IR) will lead the Kingdom’s role in utilizing advanced technologies and their local and global implications, Minister of Economy and Planning Faisal bin Fadel Al-Ibrahim said.

The Saudi minister said the new center will contribute to global discussions on the use of 4IR technology, such as 5G and artificial intelligence, especially amid the COVID-19 pandemic that has introduced new challengers to countries.

“COVID-19 intensified the need for data and evidence-based iterative policymaking supported by technology-driven and innovation-based solutions,” he said at the first Saudi 4IR forum held in Riyadh.

The Kingdom has become a global role model in deploying digital technology at peak of the health crisis, Al-Ibrahim said, enumerating Saudi efforts to manage the pandemic.

Saudi Arabia ranks 4th in the world in 5G connectivity, he added, and a robust digital infrastructure helped the Kingdom overcome challenges in the education and finance sectors.

Over 850 thousand daily classes were executed for over 6 million students in 2020, and around 2.8 billion digital payment transactions were made.

“This demonstrates Saudi`s leadership in having the most modern digital platform and world class capabilities to design local and global solutions at the technological frontier,” the minister said.

A recent report by the United Nations Conference on Trade and Development said the technology market could reach the value of 3.2 trillion dollars in 2025, increasing by almost 10 times from 2018 figures.

Al-Ibrahim said the Saudi economy could benefit from this by capturing a slice of the industry over the next five years.

The Kingdom is already in a good position, he explained, saying it “has its work cut out for it to move up the Global Innovation Index rankings where we plan to be among the leading pack of our G20 peers.”

“We are passionate about the objectives and vision of the Center, and look forward to working closely with its team in bringing the public and private sectors as well as the science and technology community together,” he added.


Brent crude back above $75 on US inventory draw, positive Fed outlook

Brent crude back above $75 on US inventory draw, positive Fed outlook
Updated 29 July 2021

Brent crude back above $75 on US inventory draw, positive Fed outlook

Brent crude back above $75 on US inventory draw, positive Fed outlook
  • US report showing falling oil supplies boosts market
  • Oil majors Royal Dutch Shell, Repsol post higher profits on oil gain

LONDON: Oil gained for a second day on Thursday as traders remained buoyed by yesterday’s data showing a bigger-than-expected drop in US inventories, while the Federal Reserve painted an optimistic picture of the American economy.

Brent crude gained 0.7 percent to $75.23 a barrel at 2:44 p.m. in London, set to close above the $75 mark for the first time in two weeks. US Benchmark WTI also added 0.7 percent, to $72.87.

Brent, the global benchmark, passed $75 a barrel in June for the first time in more than two years but has fallen below $69 on July 17 on concerns over the spread of the Delta coronavirus variant and an OPEC+ deal to increase production over the coming months.

Crude in storage fell to the lowest since January 2020, while distillate supplies posted the biggest decline since April, the US Energy Information Agency said in its weekly report on Wednesday. Fuel inventories fell by more than 2 million barrels.

The US economy is continuing to recover even as COVID-19 infections increase, the Federal Reserve said on Wednesday, sparking speculation as to when it will begin to taper its bond purchase program.

In a separate report from the US Commerce Department today, the economy was shown to have grown at a 6.5 percent annual pace in the second quarter, below the 8.5 percent predicted in a Reuters poll of economists, but still enough to bring the economy back to its pre-pandemic size.

“The (oil inventory) falls suggest the rise in cases of COVID-19’s Delta variant is having little impact on mobility,” ANZ analysts said in a note on Thursday.

Oil prices also benefited from a statement from Iran blaming the US for stalled progress in talks over its nuclear ambitions, potentially delaying the return of Persian crude to world markets.

Global oil companies, including Royal Dutch Shell and Spain’s Repsol reported blockbuster earnings today as higher oil prices boosted returns.

Shell boosted its dividend and launched a $2 billion share buyback program on Thursday as it reported the highest second quarter profits in more than two years.

Shell Chief Financial Officer Jessica Uhl said that global fuel demand was at 90 percent to 100 percent of its pre-pandemic levels, but consumption of aviation fuel remained weak.


Spanish energy giant Repsol booked a net profit of 587 million euros ($700 million) foer the second quarter, compared to a loss of 1.9 billion euros in the same period last year.

“Demand has also increased, thanks in large part to vaccination rollout,” it said.

Repsol said revenues at its petrol stations in Spain jumped by 63 percent in the second quarter when compared to the same period last year as travel picked up following the easing of lockdowns.


Cruise Saudi, MSC Group sign new five-year agreement at Jeddah port

Cruise Saudi, MSC Group sign new five-year agreement at Jeddah port
Updated 29 July 2021

Cruise Saudi, MSC Group sign new five-year agreement at Jeddah port

Cruise Saudi, MSC Group sign new five-year agreement at Jeddah port
  • MSC Bellissima will offer cruises to Safaga for Luxor, Egypt and Aqaba for Petra, Jordan

JEDDAH: Geneva-headquartered MSC Cruises announced on Thursday it had signed a five-year agreement with Cruise Saudi for preferential berthing rights at the port of Jeddah.

The announcement was made aboard the company’s liner MSC Bellissima at a celebration to mark the opening of Jeddah’s new passenger terminal. The ship will sail 21 voyages around the Red Sea starting from July until late October.

Pierfrancesco Vago, executive chairman of MSC Cruises, said in a press statement: “This is a very special, historic day for all of us. The largest and most modern ship to operate in the Red Sea has set sail from Jeddah’s new terminal to mark a new beginning for cruising in Saudi Arabia and, more broadly, for its growing tourism industry.”

The MSC Bellissima, which came into service in 2019, will offer three-to-four-night cruises to Safaga for Luxor, Egypt and Aqaba for Petra, Jordan, before returning to the Saudi homeport in Jeddah.

The ship is equipped with a 975-seat main theater, an aquapark, a bowling alley, an F1 simulator, a kids club, a cinema and a shopping gallery with more than 200 brands.

The Public Investment Fund launched Cruise Saudi in January of this year to develop a cruise industry in the Kingdom. Mark Robinson, chief operations and commercial officer, Cruise Saudi, said in a statement on Thursday: “The creation of Cruise Saudi, tasked with launching the cruise industry in Saudi Arabia, happened just six months ago at [the Future Investment Initiative] in Riyadh."

"The remit of Cruise Saudi — to create 50,000 jobs by 2025, to facilitate the building of an additional five ports, with Jeddah as a homeport, and to welcome 1.5 million annual passenger visits by 2028 — is an ambitious one, which will play a major part in strengthening the tourism industry in Saudi Arabia,” said Robinson.


Mubadala invests $250m in US biosimulation company

Mubadala invests $250m in US biosimulation company
Updated 29 July 2021

Mubadala invests $250m in US biosimulation company

Mubadala invests $250m in US biosimulation company
  • Transaction to close on August 2
  • Mubadala is building a growing life sciences portfolio

RIYADH: Abu Dhabi sovereign investment fund Mubadala has made a $250 million investment in US biosimulation company Certara, WAM reported.

Certara uses biosimulation to and technology-enabled services to accelerate drug discovery and development. The investment aligns with Mubadala’s strategy of enabling innovation to address unmet clinical needs and drive cost efficiencies.

Mubadala and existing institutional shareholders of Certara, including a stakeholder affiliated with alternative investment company EQT, have signed an agreement through which a Mubadala affiliate will buy more than 9.61 million shares in Certara at $26 per share from the shareholders in a private transaction scheduled to close on August 2.

“We are pleased to welcome a significant new investment from Mubadala, a sovereign investor with deep expertise in life sciences that is focused on creating lasting value,” said William F. Feehery, CEO of Certara.

EQT will remain a significant shareholder in the company after the transaction.

Mubadala invested almost $500 million in European veterinary giant IVC Evidensia in nearly in May. It has an asset base of 894 billion Emirati dirhams ($243.4 billion).


Jared Kushner investment firm to open Middle East office — Reuters

Jared Kushner investment firm to open Middle East office — Reuters
Updated 29 July 2021

Jared Kushner investment firm to open Middle East office — Reuters

Jared Kushner investment firm to open Middle East office — Reuters
  • Kushner plans to open an investment office in the coming months, sources familiar with the plan said
  • Israel office will attempt to build ties with India, Gulf, North Africa
WASHINGTON: Jared Kushner, a top adviser to former President Donald Trump, plans to launch an investment firm in coming months, a move that will take him away from politics for the foreseeable future, sources familiar with the plan said on Wednesday.
Kushner, the former CEO of Kushner Companies, who served as the Republican president’s senior adviser in the White House, is in the final stages of launching an investment firm called Affinity Partners that will be headquartered in Miami.
Kushner, who is married to Trump’s daughter, Ivanka Trump, is also looking to open an office in Israel to pursue regional investments to connect Israel’s economy and India, North Africa and the Gulf, said two people briefed on the plan, who spoke on condition of anonymity.
The sources had no details about potential investors and said the firm was still in the planning phase.
Kushner has spent the last six months with his family in Miami writing a book about his White House experiences that is expected to be published early next year.
Kushner helped broker deals between Israel and the United Arab Emirates, Bahrain, Sudan and Morocco in a six-month flurry last year. He also helped negotiate a new US-Mexico-Canada trade agreement.
Kushner remains close with his father-in-law, the sources said, but by re-entering the private sector he is stepping away from politics for the foreseeable future.
The Republican Party has been divided over the deadly attacks on the US Capitol on Jan. 6 by Trump supporters, and Trump’s false claims that he beat Democrat Joe Biden in the 2020 presidential election.
Kushner and his family have been spending the summer as Trump’s next-door neighbor at Trump’s golf property in Bedminster, New Jersey.
People close to the former president say he is strongly considering another run for the Republican nomination in 2024.