Oil & Gas Middle East - Nov 2009

NEWS, DATA AND ANALYSIS FOR THE MIDDLE EAST’S ENERGY PROFESSIONALS November 2009 • Vol. 5 Issue 11

An ITP Business Publication

An ITP Business Publication

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CRESCENTRISING

Badr Jafar on the pressing need to liberalise the region’s gas markets

EXCLUSIVE: DEPUTY MANAGING DIRECTOR, MAERSK OIL QATAR, TALKS UP 2009 ACHEIVEMENTSBOOSTING QATAR’S OIL: SAAD AL MOHANNADI

Middle East projects hold key to recovery – ABB president

MESSAGE FROM HOUSTON

Tackling upstream project logistics

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CONTENTS

www.arabianoilandgas.com November 2009 Oil&Gas Middle East 1

NOVEMBER 2009

22 UAE COUNTRY PROFILEA critical evaluation of the project pipeline with a focus on the Shah Sour Gas Development plan as tendering heats up.

25 YARDS AHEADDrydocks World - Dubai managing director, Nawal Saigal tells Oil & Gas Middle East the yard’s project portfolio is widening in scope.

32 CRESCENT RISINGExclusive: Crescent Petroleum executive director talks candidly about his Kurdistan project.

40 BOOSTING QATAR’S OILMaersk Oil Qatar’s Saad Al-Mohannadi reveals what the Al Shaheen project means to him.

40

REGULARS

2 COMMENT

4 WEB HIGHLIGHTS

7 REGIONAL NEWS

81 PROJECTS

88 FACE TO FACE

35

35 SHIFTING GEARThe leading land, sea and air logistics providers in the Middle East pool their knowledge in the annual upstream logistics focus.

42 PRESSURE POINTThe Middle East is tipped as the driving force behind the upstream pumps recovery. The region’s top pumps providers tell it how it is.

44 TROUBLESHOOTINGPadraig Nagle says tailored rapid response fl uid handling solutions are more cost effective.

49 DOHA DELIVERSThe must-attend conference of the year starts next month. Oil & Gas Middle East previews IPTC 2009.

67 ASK THE EXPERTAPI standards come under the microscope with AESSEAL’s Richard Smith, director, oil and gas development.

69 SHOWBOATINGMiddle East Workboats splashed into Abu Dhabi last month. Meet the trend setters.

88

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WEB HIGHLIGHTS

Getty Images

ONLINE SPECIAL REPORT

The online home of:

Top ten oilfi eld technology fi rmsArabianOilandGas.com has decided to salute the companies who spend billions of dollars as well as millions of man hours on making the life of an average oil and gas worker productive, safer and easier. What many people outside of the oil & gas industry don’t know, is just how difficult getting to the precious black stuff can actually be. With many of the world’s largest oilfields maturing, more and more technological wizardry is required to enable the oil producers to keep on churning out oil and gas for an ever-growing global market.

A senior Technip official has said that EPC contracts are to be awarded in the United Arab Emirates in the next six-to-nine months.ArabianOilandGas.com

Saudi Aramco is among the companies interested in helping the South Amer-ican country to develop its pre-salt oil reserves, reports suggest.ArabianOilandGas.com

The Zakum Development Company (Zadco), is plan-ning to award around US$4 billion worth of contracts in the next 18 months. ArabianOilandGas.com

Natural gas projects in Qatar have not suffered from the economic crisis, Sheikh Hamad bin Khalifa Al-Thani, the Gulf state’s Emir, has said.ArabianOilandGas.com

BREAKING NEWS AND VIEWS FIRST

ZADCO PLANNING TO AWARD CONTRACTS

ARAMCO LOOKS TO DEVELOP BRAZIL’S OIL

UAE TO AWARD $21BN WORTH OF CONTRACTS

EMIR:QATAR COMMITTED TO SUPPLYING GAS

1 Exclusive: Tecnimont to win $1 billion Fertil contract

2 Aramco awards $200 million bulk plant upgrade to Suwaidi

3 ExxonMobil/SABIC petrochemical plants to cost $5 billion

4 Aramco awards KBR major Shaybah gas contract

5 Aramco sued for death of ‘beauty queen’ camel

SPOT POLL

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WHAT WOULD YOU LIKE TO SEE MORE OF ON ARABIANOILAND-GAS.COM?

READ THE INDUSTRY’S VIEWS

Who’s got the inside track on Shah Sour Gas Field tenders?ArabianOilandGas.com

LATEST FROM THE BLOG

CHEVRON is a registered trademark of Chevron Corporation. The CHEVRON HALLMARK and HUMAN ENERGY are trademarks of Chevron Corporation. ©2009 Chevron Corporation. All rights reserved.

For over 75 years in the Middle East,we’ve invested in more than just energy.

As one of the Middle East’s leading energy development companies, we at Chevron believe not just in the process of extracting energy but also in the investment of energy in the correct and best way possible. Therefore, along with global integrated energy solutions, from refining oil and processing gas, producing petrochemicals and lubricants and developing innovative fuel technologies, we’re also investing in Middle Eastern communities. Helping them achieve a better tomorrow, through educational and economic development, training and employment. We aspire to be more than just an energy company. And we aim to do that by investing in the most potent source of energy there is - Human Energy.To learn more, visit us at chevron.com

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COMMENT

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I n recent years a whole matrix of other-worldly real estate projects and luxurious developments has grabbed the head-

lines and the attention of millions around the globe where the United Arab Emir-ates is concerned. While diversification from a strictly hydrocarbon economy has been unapologetically bold and successful, perhaps for those of us in the industry, it’s not such a bad thing that oil and gas is coming back to the fore.

This year’s resilience to a globally woeful 2009 is rooted in what lies beneath. The bountiful reserves that are awash beneath the Emirates have again this year become the focus of attention. This is no bad thing. The pockets of oil and gas found here are vital not just to the UAE, but to the millions of consumers around the world who use it every time they get in their car or turn on their lights. What’s more, it is in the UAE’s DNA.

This edition of Oil & Gas Middle East is equally unapologetic for its UAE focused coverage. Of course we have industry leaders from the Arabian Gulf region, no less than Saad Al Mohannadi,

UAE in pole positionProject pipeline thrusts Abu Dhabi into global spotlight

To subscribe to the magazine, please visit: www.ArabianOilandGas.com

Published by and © 2009 ITP Business Publishing, a member of the ITP Publishing Group Ltd. Registered in the B.V.I. under Company Registration number 1402846.

A real determination to push ahead with ambitious upstream projects has put oil centre stage again.

BPA Worldwide Circulation StatementAverage Qualified Circulation: 7,188 (Jan - June 2009)

deputy managing director of Maersk Oil Qatar. And we have a region-wide upstream logistics special report, as well as all the news and views from across the Gulf.

But the November edition comes with a detailed country profile on the UAE’s oil and gas assets and project developments, as well as a revealing interview with Nawal Saigal, managing director of Drydocks World - Dubai. Abu Dhabi is also praised by technology firms and oilfield service providers for its vision in making this year bearable through its commitment to upstream development.

Our cover story traces the remark-able journey of Sharjah’s Crescent Petro-leum. The company is at the forefront of delivering Middle Eastern gas to Europe through the Nabucco pipeline project, and in our exclusive interview with Badr Jafar, CEO of Crescent Investments, he pulls no punches about what needs to happen to local gas markets, as well as sharing his international gas - for - peace vision. Enjoy.

Daniel Canty, EditorE-mail: [email protected]

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November 2009 Oil&Gas Middle East 7www.arabianoilandgas.com

ADNOC backs rail over pipeAbu Dhabi National Oil Compa-ny (ADNOC) is reported to be in discussions with the Union Railway regarding transport-ing over seven million tonnes of granulated sulphur per year from the Shah and Habshan gas fields to a treatment facility in Ruwais.

The chairman of Union Railway, Hussain Al Nowais, told a Middle East rail projects conference that transporting the sulphur by rail offers a better solution than the proposed pipeline.

“We are very excited to have the opportunity to work with ADNOC. This important stra-tegic initiative will fulfill several strategic objectives,” he said.

“It will support ADNOC’s ongoing investment program in the Shah and Habshan oil and gas fields. It will also contribute to the development of the oil, gas and petrochemical indus-tries in the country.”

“Finally, it will help to accel-erate the development of the Western Region, in line with Vision 2030. This section of the railway will be fast-tracked to meet ADNOC’s schedule and requirements,” he added.

The US$10 billion Shah gas project in Abu Dhabi that is being developed by ADNOC and the US energy company ConocoPhillips has struggled to find contractors willing to take on the $1 billion 275km sulphur pipeline contract that was part of the initial plans due to the problems in transporting sulphur over such a distance.

Spiralling costs, technical concerns and safety fears behind decision to opt for rail

The project is massive as it will meet a large part of the country’s gas needs but its costs are expected to be high as well, because all the gas is sour. Transporting the sulphur by pipeline would have involved building the world’s longest liquid sulphur gas pipeline of at around 300km.

The pipeline will transport about one billion cubic feet of gas to the Ruwais processing facilities south of Abu Dhabi. Industry sources believe the project will cost in excess of $10 billion (Dh36.72bn) given the topography of the field and the high sulphur concentrations in the gas. But they said costs were in the range of $13bn to $14bn in 2008 when construc-

tion materials and contracting expenses were at their peak.

“I think the development of this field is vital for Abu Dhabi and the whole of the UAE as they need more gas given the rapid growth in consumption. I am sure it will meet a large part of the country’s gas require-ments when it is completed, probably within five years,” one source said.

The decision to build an overland rail solution solves a major, and expensive problem for ADNOC.

LEAD NEWS

The Shah project is a joint venture between Adnoc and the US-based ConocoPhilips. Its initial output target is about one billion cubic feet of gas per day. Said Ahmed Al Ghafli, chief executive of the joint venture company, said in October that safety remains a key concern for the developers due to the high sulphur component. “The JV will pursue the development of a world-class facility that can process one billion cubic feet per day of very sour gas containing some 23 per cent of hydrogen sulphide,” he said.

The bidding deadlines for the US$10 billion Shah gas field development are expected to be extended, sources close to the bidding process have said.

$10BNThe Shah Gas fi eld development is estimate to cost around $10 billion

Source: ADNOC


REGIONAL NEWS

Vam Drilling starts UAE expansionSubsidiary of Vallourec agrees deal to buy DPAL and targets Middle East pipe business

De Coignac also revealed that he believes new drilling techniques will drive industry trends in the future. “I think the main trend is the evolu-tion of drilling techniques, for example; deviated drilling, extended reach drilling, more gas drilling and more deep offshore drilling.

“So when you talk about the risk of depletion of oil and gas, we are far from this point, it only means we will have to go further to seek reservoirs that are in more remote places with access that can be a lot more complicated.

“This for us is an important trend that the industry is calling for more technology and more technological products there-fore this is exactly where we are positioning ourselves,” de Coignac concluded.

Qatar’s Ras Laffan scoops energy honours at Seatrade awardsRas Laffan Industrial City grabbed the spotlight at the an-nual Seatrade Middle East and Indian Subcontinent awards after walking away with a hat-trick of awards. Ras Laffan In-dustrial City claimed the first of its three honours of the night by winning the Environment Pro-tection award. This award was a first for Ras Laffan Industrial City and it was presented by Joseph Brincat, Vice President, ABS- Middle East to RLC direc-tor Sheikh Khalid Bin Khalifa Al Thani. Ras Laffan Industrial

announcement of its second award. The Energy: Oil & Gas Award, was won by RLC for the second year in a row.

RLC director Sheikh Khalid Bin Khalifa Al Thani collected the Oil & Gas award.

so we felt the best way to make a significant step to increase our presence was to have a manu-facturing base there,” Nicolas de Coignac, deputy managing director of VAM Drilling said.

He added that the acquisi-tion will enable the company to react quickly to customer needs in the region and also to shorten lead times.

“We are enjoying a dual advantage competitively; being more local, because DPAL has been here for a long time and has gained a reputation, and to expand the products we offer. So we will combine both strengths to hopefully gain a significant market share in the region,” said de Coignac.

Vam Drilling has grown in recent years through acqui-sitions, buying companies in 2005, 2006 and now 2009.

Vam Drilling has targeted an increased share in the Middle East drilling products market with the acquisition of drill pipe manufacturer DPAL.

The firm, which is a wholly owned subsidiary of Vallourec,

“This is a dream run for us and it is a significant moment for all of us at QP and Ras Laffan Industrial City.

“We are thankful to HE Abdulla Bin Hamad Al Attiyah, Deputy Premier & Minister of Energy and Industry for his directives and support and to each and every employee of Ras Laffan, who were the crucial factors for this resounding success and the series of accolades received tonight,” beamed RLC Director Sheikh Khalid Bin Khalifa Al Thani.

unveiled the acquisition of the UAE based firm last month, and has immediately signaled its intent in the region.

“The UAE is a place where our market share was way too low considering our ambition,

City also won the coveted Port Authority Award honour. The celebration for the RLC team had already begun before the

Nicolas de Coignac, deputy managing director of VAM Drilling.

REGIONAL NEWS


Recovery will be steadyTOPAZ chief says consistency will shape upstream service revivalTOPAZ Energy and Marine chief executive officer, Fazel Fazelbhoy told Oil & Gas Mid-dle East that sporadic ‘green shoots’ and V-shaped economic recovery are fanciful, and that strong energy fundamentals will dictate a more gradual return to form for the industry.

Speaking from the Middle East Workboats conference and exhibition in Abu Dhabi last month, Fazelbhoy said that traditional marine business models had been disrupted in recent years by cheap credit and a rampant supply vessel construction boom.

“The offshore support vessel sector is paying for the sins of our past in terms of the indisci-

pline in building new vessels in South East Asia. There has been a lot of froth in the market so far and this is a period for coming to terms with that,” he said.

Fazelbhoy said reasonable prices for newbuilds were back on the table again after a period of exuberance.

“The good news is that vessel demand will be absorbed over the life of projects as they

Fazel Fazelbhoy, CEO, Topaz.

HIGHLIGHTS

Bahrain Petroleum Company (Bapco) has signed an EPCM contract worth a total of US$63.4 million with Technip France - Abu Dhabi for the installation of new two 10 megawatts steam turbo-generators as well as the housing and substation. “This project marks a signifi cant step towards improving the reliability and oper-ability of the power generation system in the refi nery and other facilities,” Oil and Gas Affairs Minister Dr Abdul Hussain Mirza said (pictured above).

Tendeka, the Dutch registered technology provider, has an-nounced that it has completed the acquisition of the Middle East-based completion company Flotech for an undisclosed fi gure.

go forward. Fortunately the Middle East is still continuing because it is very much the NOCs that continue to operate, continue to expand and continue to explore.”

Fazelbhoy added that new oilfield development will require state of the art vessels, and owners and operators posi-tioned to service this require-ment will be the real winners in years ahead. “Simply put there is no such thing as easy oil now. New oil will be deep, it will be distant and it will be dangerous. The industry will be working with high pressures, with higher sulphur content with deeper water depths and further offshore. At some point demand for the right marine assets kicks in and we are plan-ning for continued deployment at reasonable rates.”

Read Fazel Fazelbhoy’s full Q&A on ArabianOilandGas.com

Eaton expands local businessIndustrial manufacturer Eaton Corporation has entered into a JV in the UAE through SEG Middle East Power Solutions & Switchboard Manufacturer of Abu Dhabi.

“This JV provides Eaton with an operation that has built a successful business supplying switchboard and control solu-tions in the Middle East,” said Frank Campbell, Eaton elec-trical sector president, EMEA.

A senior official from GS Engineering & Construc-tion (GS E&C) has confirmed that the company has been awarded a US$1.37 billion gas contract in Iran.

Moo-ik Chang, vice presi-dent of the South Korean contractor reportedly said that a deal to sweeten gas from the South Pars gas field had been agreed with Pars Oil and Gas Co, which is a subsidiary of the state-owned

GS Engineering nets $1.37bn South Pars contract

380K$ bill: Annual running cost of TOPAZ sponsored charity ship Flying Angel

South Pars development has been slow.

firm, the National Iranian Oil Company (NIOC).

GS E&C will carry out the work as part of a consortium that includes Iranian Inter-national General Contractor Co. The company agreed to complete phases 6, 7 and 8 of South Pars by May 2013.

South Pars accounts for Iran’s largest gas reserves. Due to the immense size of the field, the development plan has been divided into 24 different phases.

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REGIONAL NEWS


Eni agrees Zubair dealEni has announced it has been awarded the licence for the de-velopment of the Zubair oilfield in Iraq, following a successful first round bid.

The Italian supermajor is leading a consortium consisting of Occidental Petroelum Corp from the US and the Korean Gas Corporation. Eni’s share is around 40% although the company said that there may be minor adjustments to that figure in the near future.

“The award of the explora-tive licence for the Zubair field strengthens the long-term collaboration between Eni and Iraq, which dates back to the 1970’s, and will allow Eni to

Italian-led consortium agrees Iraqi oilfield terms in Baghdad

further grow its production and reserves,” a statement released by the company said.

“The service contract will last 20 years and can be extended to 25. It also includes the participation of Iraqi State Company, Southern Oil, with a 25% share,” it added.

The Zubair field, one of the largest Iraqi oil fields, and has a current production rate of 195,000 barrels of oil per day. In the next seven years, under the field’s expansion programme, production is expected to reach a plateau level of 1.125 million barrels of oil per day.

The project includes the drilling of over 200 wells, the

Iraqi Oil Minister Hussein al-Shahristani

EVENTS

SAOGE1 - 3 November, DammamSHOW PREVIEW - PAGE 35

NON DESTRUCTIVE TESTING CONFERENCE8-11 November 2009Exhibition - GICC, Gulf Hotel, Bahrain

MIDDLE EAST GAS SUMMIT 2009 (MEGAS)24-25 November 2009Conference - Beirut, Lebanon

INDUSTRIAL & HAZARDOUS WASTE MANAGEMENT CONFERENCE8 - 9 Nov 2009Conference, Dubai, UAE

ABU DHABICONFERENCE 2009 10 – 12 November Emirates Palace, Abu Dhabi, UAE

IRAQ ENERGY EXPO5-7 DecemberMeridian Hotel, Baghdad, Iraq

INTERNATIONAL PETROELUMTECHNOLOGYCONFERENCE 20097-9 DecemberSheraton Resort, Doha, Qatar(For a full IPTC event preview see pages 64-65, and follow the build-up live on ArabianOilandGas.com)

Lamnalco inks services deal Sharjah-based marine services provider Lamnalco has signed a 10-year contract for integrat-ed marine services with the Caspian Pipeline Consortium (CPC) in Moscow, Russia.

The contract, announced at the Middle East Work Boats conference in Abu Dhabi, includes a turnkey package of services for CPC’s pipeline and related infrastructure opera-tions that link the oil fields of West Kazakhstan with the marine terminal located on the Russian Black Sea Coast, close to Novorossiysk.

Lamnalco said that it will also provide a permanent on-site dive team and mainte-nance for two single buoy moor-ings (SBM) as well as oil spill

response services for the dura-tion of the contract

“This will involve the deploy-ment of a modern fleet of 15 vessels including a multi-pur-pose service vessel (MSV), tugs, line handling boats and boom boats as well as a full IMCA approved dive spread housed on the MSV,” a state-ment released by the company this month said.

The full value of the contract was not disclosed.

Oman Gas Company (OGC) has announced that it is car-rying out work on its gas network in a bid to raise the transportation capacity of the existing pipe.

Domestic media reported that the modifications are being made to the southern network of OGC’s gas transportation system. The scope of work includes the construction of a 252 kilometre 32-inch pipeline that will run from Saih Rawl to Sadad by the Indian contractor Punj Lloyd.

The project also involves the construction of other associated facilities at seven different inter-mediate stations.

Oman looks to up gas export

6 MILLIONBarrels of oil export that Lamnalco vessels support each day

Source: Lamnalco

construction of treatment facili-ties and the required collection network, as well as the refur-bishment of the existing plants.


REGIONAL NEWS

DNV launches academyTailored training solutions prove successful draw for DNV

Ghanem set to return as Libyan oil chief

The mystery regarding Septem-ber’s resignation of Dr Shokri Ghanem as the Libyan energy minister and chairman of the state-owned National Oil Cor-poration (NOC) deepened in October after a senior source in Tripoli told ArabianOiland-Gas.com that he is expected to be re-appointed to both of his former roles as part of a major re-structuring of the oil industry in the North African state. “I can ensure you more than 90% that Dr Ghanem will be reappoint-ed as a head of the NOC,” the source said.“He is in holiday, he will back to his position soon,” he added.

Norwegian classifications soci-ety DNV has launched a fully fledged Maritime training acad-emy, and is expecting a huge draw for the oil and gas offshore and support sector. Speaking to Oil & Gas Middle East from the Middle East Workboats con-ference and Exhibition held in Abu Dhabi last month, Malcolm Beere, head of DNV Academy Middle East, said the response from owners, operators and oil and gas related yards in the re-gion has been encouraging.

“I think that in a recession, when cost consciousness is top of everybody’s agenda, people will be more reluctant to send staff thousands of miles and meet accommodation costs when there is now a very capable option on their door-step,” he said.

Beere said that DNV were involved in ongoing negotia-tions with customers to deliver a course schedule tailored to

local needs. “Our purpose isn’t just to have a local academy for the sake of having people on the ground. We’ve spent a lot of time dealing with customers of our other facilities worldwide and potential clients here in the Middle East, so that we deliver something worthwhile and valu-able to the local sector, and also make a difference to their overall manpower sustainability.”

Malcolm Beere, head of DNV Academy Middle East.

Beere said that the Academy, working out of Dubai, has a public schedule but is in the process of developing in-house tailor made offerings. “These courses can be mixed and matched with all of the courses we have available worldwide, to suit the local market. A good example would be a tailored superintendent’s course for workboats,” he concluded.

Dr Shokri Ghanem: Reappointed.


REGIONAL NEWS

ADSB looks to offshore With Mubadala backing yard can take a real lead says VPAbu Dhabi Shipbuilding has signalled that, with Mubadala backing, it may enter the oil and gas workboats industry as a major player within the next few years.

Speaking candidly to Oil & Gas Middle East at the Middle East Workboats 2009 event in Abu Dhabi last month, ADSB vice president, marketing, William Stewart indicated that the expertise developed through naval vessel building would stand the firm in good stead within the upstream support industry.

The Mussaffah based yard has recently renewed long-term drydock agreements with Esnaad and Irshaad for the oil and gas offshore industry. Esnaad, a wholly owned ADNOC offshore support company.

Military vessels account for 90% of the company’s current order book, but the firm has also engaged in building commer-cial workboats and tugs. “One has been delivered to National Dredging already, and the others are in completion stage for delivery early next year,” revealed Stewart.

“Mubadala are beginning to take a big interest in Abu Dhabi Shipbuilding and they are looking at how they are going to position us in the future. That could mean expanding the facility into another commercial yard here, or it could alterna-tively mean acquiring or joining forces with another shipyard elsewhere in the world commer-cially,” he added. William Stewart, ADSB.

Abu Dhabi Ship Building’s yard is currently engaged in building naval vessels.

Libya’s energy cities launch with US$54 billion price tag

Libya has launched a US$54 bil-lon master plan to construct two energy cities at Al Brega and Ras Lanuf, located on its Medi-terranean coast.

The government of Libya, has commissioned US engi-neering firm Fluor Corporation to develop a master plan for the scheme in July 2007. The fund approved the final version of the plan in July 2009, but has only now disclosed its contents.

“The $54 billion project will be executed in three phases and will be implemented in 15 years,” Amir Nemr, director of process technology at Fluor told ArabianOilandGas.com.

“The energy city of Al Brega will include the expansion of a liquefied natural gas plant and a new grassroots natural gas liquids plant.”

“It will also include a 350,000 barrel per day refinery,” he added. Libya has mooted a rede-velopment of Ras Lanuf and Marsa el-Brega since the 1980s, but trade embargoes crippled Tripoli’s plans. The US lifted the last trade embargoes in 2004.

90%ADSB’s order book is heavily dependent on naval newbuilds

Source: Abu Dhabi Ship BuildingAmir Nemr, Fluor Corp.

Stewart noted that much of standard class shipbuilding has migrated away from European yards, to cheaper building envi-ronments in Asia, but high-end vessel manufacture remained strong in the European market.

“As the industry goes into more complex fields and deeper waters, you need much more sophisticated vessels, and they are still built in the knowledge

centres. I believe the next gener-ation of specialised vessels will start to come through Middle Eastern yards and that’s the point at which we enter that market. We are already building advanced naval quality vessels, so we are capable of delivering to that high-end custiomer.”

Stewart revealed that the company had already begun using 3D modelling technology in order to join the world’s leading yards in terms of design capability, and that the oil and gas industry was a likely target for new business. “There is a huge opportunity for Abu Dhabi Ship Building, through Mubadala, to take a real lead in this field.”


INTERNATIONAL NEWS

October sees oil soar to 2009 high$80 barrier is broken amid bullish global trading in New York while gas prices fall

UK’s Hi-Force continues expansion roll-out with new delivery

Oil surged to its highest price of the year in October, topping out at more than $80 a barrel on New York’s Mercantile Ex-change. Analysts said that the price hike was largely driven by the dollar’s fall against a basket of currencies.

Conversely, the price of natural gas in the US continued its downward spiral.

Crude surmounted $80 a barrel early on Tuesday 20th October, capping a two-week rally, before sliding on investor Oil surged to an annual high in October on the New York Mercantile Exchange.

October saw the fifth brand new Mori Seiki CNC Machining Centre arrive at the Hi-Force machine shop in the UK, bring-ing total spend on new machines in the past 18 months to over US$1.6 million.

Group managing director Kevin Brown commented: “This

will be the last new machine to be delivered to our existing machine shop, as all future purchases will be installed directly into our brand new facilities in Daventry after we relocate in June 2010. An order has already been placed for a state of the art 9 axis Mori Seiki

machining centre costing over US$800 000. “The move to this brand new state of the art facility will allow Hi-Force to accelerate our ambitious growth plans over the coming years. We are a company that exports over 85% of its products to more than 100 countries,” said Brown.

Work on a new 50,000 square feet facility will now proceed at full speed to ensure completion and handover by the end of June next year.

Hi-Force has operational offices in both Abu Dhabi’s Mussafah Industrial Zone and Dubai’s Jebel Ali.

concern sluggish US crude demand may not justify further gains. Despite significant builds in stockpiles and lackluster oil demand, oil prices have almost trebled from December’s low of $33 and have consistently traded between $65-$75 throughout summer. Oil producers and upstream service companies will be hoping the trend signals a steady trading zone of between $70 and $80, ensuring all but the most expensive projects will go ahead in early 2010.

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NEWS INTERVIEW

Service sector picks up

R ising oil prices should result in an upturn in fortunes for the serv-ice sector of the oil and

gas industry, experts have re-ported. After a year of testing conditions, there now appears to be hope in sight for service companies in the region.

“There is no question it has been a tough year for the service sector. Oil companies have been using many means and tech-niques for cutting costs. That has ranged from talking tough over the negotiating table to actually renegotiating contracts and looking for lower rates,” reports John McCreery, partner, energy practice, global oil and gas expert, Bain & Company.

Although there has been a recovery in the market and hope is at hand for the service sector, McCreery believes this

A swift recovery of the oil price has given renewed hope to the upstream service sector

is no time for them to get over enthusiastic. “As oil prices have recovered, quite a few of the service sector companies are breathing a sigh of relief. What we have seen in the past couple of months, despite the recovery in the oil price, many companies are looking for savings and reductions in cost, trying almost to restructure the cost base,” he states.

In seeking to reduce costs, oil companies in the Middle East appear to have increas-ingly looked to the East for support services, and this has led to increased competition. “There is competition coming from the East and particularly coming from the Chinese and Indian service sector compa-nies,” McCreery affirms.

“What we have seen generi-cally is things like 20% price

“If the oil prices settle at around $60-70 and stay in that kind of range, then the industry will generate a lot of cash, particularly in the Middle East” John McCreery

reductions in areas such as drilling, seismic and other explo-ration related activities and some areas of the capital project activi-ties like engineering design and construction. But it has been really the maintenance and operational types of expenditure which have remained pretty robust,” he adds.

PROJECT ANALYSISProject activity in the Middle East region has remained steady, reports McCreery. “Despite the downturn in oil price the Middle

East, and certainly Bain & Com-pany’s experience in the Middle East supports this, the area has held up pretty well in terms of activity,” he states.

“Many of the large NOCs have quite ambitious project schedules and plans to expand production. If you add in their existing fields, some of which are getting quite complex with maturing reservoirs, there is quite a lot of activity.”

McCreery adds that new techniques are also being deployed in the Middle East,

Oman is deploying cutting edge enhanced oil recovery techniques to capitalise on its hard-to-get assets.

NEWS INTERVIEW


in particular Oman. The long term oil output of Oman is relying on the success of the deployment of enhanced oil recovery (EOR) projects and they are to be found in several fields in the country.

This continuation of invest-ment has not been without casu-alties, however. “The NOCs and many of the big major oil compa-nies have largely continued to invest through the cycle and it’s been the independents and the smaller oil companies that have struggled,” McCreery explains.

With oil prices at a healthy level, NOCs in the Middle East will need to invest the money they are currently generating wisely, McCreery believes. “If oil prices settle at around $60-70 and stay in that kind of range, John McCreery, partner at Bain & Company

then the industry will generate a lot of cash, particularly in the Middle East where you have got fairly low production costs.

“So both the NOCs and the international companies oper-ating in the region have got some quite important decisions to make on where they deploy that additional cash because at $60-70 dollars, they are gener-ating pretty good returns.”

COLLABORATIVE ACTIONIn the wake of the downturn, there were renewed calls for greater collaboration between the NOCs and the IOCs in the Middle East, and this is some-thing that Bain & Company has witnessed in its research. “We have seen participation and collaboration evolving in

recent years and we believe that trend can and will continue,” McCreery stresses. “The driving force is that some of the NOCs have developed their capabilities and can be much more equal partners in areas like technology, field development planning and people development.” Mc-Creery sees no real barriers to future partnerships. “All the ingredients are in place for collaboration, so we see the opportunity being there for it to evolve and become more partner-ship-based over the next few years,” McCreery concludes .

NEWS ANALYSIS


NEWS ANALYSIS

Gains start in Mid EastSpending by the Middle East national oil companies (NOCs) is underpinning the return to previous levels of global spend in the upstream sector, ac-cording to a report from Wood Mackenzie.

The report reveals that the Middle East, along with the US, West Africa and the states of the former Soviet Union, will contribute to the majority of growth in the sector, as the economy recovers. The report also found that the major areas of growth have been underwrit-ten by NOC’s such as in Saudi Arabia, Abu Dhabi and Brazil.

Morris Reid, managing director of the BGR Group, affirms that NOCs in this region are in a strong position. “They are bullish, as long as they are running their prices at a steady level, they are in great shape. If we had every renew-able known to man available, it would still only be able to produce 50% of our energy, so crude is still a big part of our lives,” Reid states.

Reid adds that the Mid-dle East region is looking extremely healthy in general: “This region is still the most important region because it has all the capital, the major oil reserves and a young popula-tion,” he comments.

Middle Eastern countries to kick-start upturn in global upstream spending - report

Production capacity is expected to grow globally over the next few years, and the Mid-dle East is expected to lead the way in this respect. Iain Brown, vice president, upstream energy research for Wood Mac-kenzie explains in the report: “By far the greatest growth in the five year period to 2014 is in the Middle East, with installa-tion of new oil capacity in Saudi Arabia, Iraq and Abu Dhabi, and incremental gas in Qatar, Abu Dhabi and Iran.”

Part of the reason for this projected increase in capac-ity is the relatively low cost of expansion in certain regions in the Middle East. “New capac-ity in Iraq is amongst the low-est cost in the world, but at the same time it is the most tenu-ous. We expect that over US$24 billion dollars could be spent in the five years to 2012, with the prospect of increasing produc-tion capacity by 850,000 b/d,” reveals Brown.

“However, the scale and schedule of any significant development spend is fun-damentally uncertain due to the prevailing security situa-tion, and growth in oil capac-ity is reliant on renovation and expansion of key distribution and processing infrastructure,” he adds. Stable oil for much of 2009 is enabling the region to spend its way to recovery.

Morris Reid, is managing director of BGR Group.


UAE IN PROFILEThe state of play in the region’s most dynamic upstream market

The United Arab Emir-ates derives the over-whelming majority of its State revenues from the

rich oil and gas reserves which sit beneath the Emirates. Of course, strictly speaking, the lion’s share of that is concen-trated in Abu Dhabi, the capi-tal city and production hub.

However, a good number of the support and service indus-tries that dot the Fujairah and Sharjah coasts, and the mas-sive enterprises nestled into the booming Freezones of Dubai can attribute their success to those reserves too.

The UAE has managed to deliver business and enterprise

throughout the country from that oil and gas base in a much more successful way than many of its neighbours. Whilst chinks have appeared in the armour in 2009, the successful diversification programmes it has embarked upon, including aluminium manufacture, pet-rochemical production and its hard-won status as a genuine logistical hub for the region, all remain solid and viable business ventures, and will remain so for decades more.

OVERVIEW Oil and gas production has been the mainstay of the economy in the UAE and will

remain a major revenue earner long into the future. Proven recoverable oil reserves are estimated in the 97 to 98 billion barrels range, depending on where you look. This equates to a phenomenal 9.5% of the global crude oil proven reserves.

As for natural gas, the proven recoverable reserves are esti-mated at around 214 trillion cubic feet (Tcf). The small Gulf nation holds the fourth larg-est proven natural gas reserves in the Middle East after Iran, Qatar, and Saudi Arabia. As with oil, the largest reserves of 198.5 Tcf are located in Abu Dhabi. UAE government sources esti-mate that such reserves, at cur-

rent production will, excluding any new discoveries, last for over 150 years.

The UAE ’s oil production is limited by quotas agreed within the framework of OPE C to 2.25 million barrels per day (mbd). Production capacity, however, is slated to rise to approximately 5 million bpd by 2014, though the impact of current OPEC quo-tas and sluggish global demand recovery may see those plans strategically slowed.

Japan is a major trade partner for the UAE, and in 2008 Japan imported 369.2 million barrels of crude oil from the UAE, cov-ering 25.1 per cent of Japan’s total crude oil imports.

COUNTRY FOCUS: UAE


COUNTRY FOCUS: UAE

its ability to export refined prod-ucts from the region.

PRESSURE POINTMuch of the UAE’s current crude oil production is made possible by the reinjection of natural gas to boost pressure in the nation’s major oil res-ervoirs. Without this massive programme, the UAE’s crude production would stagnate and decline. The UAE is testing carbon capture and sequestra-tion technologies to replace the reinjection of natural gas. This would enhance exports of natu-ral gas, create more flexibility in oil production and provide glo-bal environmental benefits.

BOOSTING EXPORTSIn 2005 the UAE became the one of the first major oil-pro-ducing countries to ratify the Kyoto Protocol to the UN Con-vention on Climate Change. As part of its energy diversification strategy, the UAE is working in

a variety of ways to reduce its carbon footprint, meet its own domestic energy needs and expand exports:

To reduce hydrocarbon con-sumption, and pave the way for a new generation of planned communities, Abu Dhabi is investing more than $20 bil-lion in the famous Masdar pro-gramme (See www.Utilities-ME.com for more on Masdar). Additionally, the UAE is a pio-neer in the region’s peaceful nuclear energy programme. Tremendous population growth as well as intense water desali-nation requirements require a huge electricity supply, and that demand is only set to grow. This reduces domestic demand for natural gas and the need for oil-burning power plants used to meet peak demand during hot summer months.

REGIONAL FIRSTIn the first major cross-border energy deal between Gulf coun-

tries, the UAE is importing nat-ural gas by pipeline from Qatar. The gas supports domestic elec-tricity demands and frees Abu Dhabi’s natural gas supply for crude oil recovery. The project began delivering gas to power companies in the second quar-ter of 2007.

Among other energy effi-ciency drives, is Dubai’s devel-

Ali-Al Jarwan general manager of Abu Dhabi Marine Operating Company (ADMA-OPCO).

The big question of course is what projects and develop-ments are in the pipeline over the course of the next dec-ade? Information from a vari-ety of government sources has been compiled and digested in the following snapshots. For detailed coverage and analysis of the UAE’s major oil and gas projects and plans, and a special report on the ADNOC group of companies go to ArabianOiland-Gas.com.

$43 BILLION PORTFOLIOTurning to the future, upstream oil and gas entities in the UAE continue to identify new projects aimed at boosting the nation’s crude oil production capacity to nearly 4 million barrels per day by 2020, which would amount to an additional increase of approx-imately 40 percent over current production levels.

Reaching this ambitious tar-get will represent a massive undertaking of resources and investment, particularly in light of persistent manpower and materials shortages that have afflicted the global oil and gas sector since 2003. The UAE has invested roughly $7 billion in upstream production infrastruc-ture since 2004 and anticipates investing some $43 billion more in the coming years. At the same time, the UAE will invest more than $6 billion to expand its domestic refining capacity, which will significantly expand

4BILLIONThe 4 billionth barrel of crude oil from Zirku Island terminal was shipped in April this year

Source: Zadco

• Proven recoverable oil reserves are estimated in the 97 to 98 billion barrels range• The proven recoverable gas reserves are estimated at around 214 trillion cubic feet (Tcf).• In 2008 Japan imported 369.2 million barrels of crude oil from the UAE• Oil production capacity is slated to rise to approximately 5 million bpd by 2014

QUICK UAE FACTS


COUNTRY FOCUS: UAE

opment of the region’s first light rail system, the Dubai Metro. Phase one launched this year, with a more comprehensive net-work going live in 2010.

WORKING WITH GLOBAL PARTNERSThe UAE has a history of wel-coming private-sector invest-ment into its upstream oil and gas exploration and production sector. Abu Dhabi was the only OPEC member not to national-ise the holdings of foreign inves-tors during the wave of nation-alisation that swept the global oil and gas industry in the mid-1970s, and it continues to ben-efit from high levels of private-sector investment.

Today international oil com-panies from the United States, Japan, France, Britain and other

countries continue to hold com-bined equity stakes of between 40 and 100 percent in Abu Dhabi’s vast oil concessions.

Occidental Petroleum of the US and Total of France each has a 24.5 percent equity stake in the Dolphin Energy gas pipeline project. ExxonMobil recently won a tender for the redevelop-ment of the Upper Zakum field, which will ultimately increase oil production by more than 220 000 barrels per day.

Last year, US supermajor ConocoPhillips won a multi-billion dollar open tendering bout for the development of mas-sive sulphur-rich gas reserves in Abu Dhabi, further limit-ing the amount of crude oil that would need to be burned domestically for internal elec-tricity generation.

This huge sour gas project involves the development of natural gas condensate reservoirs within the Shah gas field, located onshore approximately 180km southwest of the city of Abu Dhabi. The project will involve the construction of a new one billion cubic feet per day natural gas processing plant at the Shah gas field, new natural gas and liquid pipelines and sulphur-exporting facilities at Ruwais in Abu Dhabi. ADNOC will have a 60% interest and ConocoPhillips will have a 40% interest in the project. Recently the decision to move away from a pipeline solution to an overland rail link has come to the fore. Local reports suggest that Union Railway is enlarging the scope of its UAE heavy railway network so it can transport sulphur from Al Gharbia for the project. The proposed rail link will carry granulated sulphur, a by-product of processing sulphur-rich oil and natural gas, from the Shah field, the Ruwais petrochemicals complex and port. Sulphur, at times a valuable commodity (though prices have fallen somewhat since the field development plan was initially announced), could then be exported by ship to global markets.

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COUNTRY FOCUS: UAE

YARDS AHEADNawal Saigal, managing director of Drydocks World Dubai says upstream conversion work is booming and more offshore work is in the pipeline

D rydocks World – Dubai is one of the most pro-lific shipyards in op-eration. The shipyard

is the largest facility in the Middle East and is the flag-ship company of Dubai World subsidiary Drydocks World. A ship repair yard of choice, it is also a preferred location for vessel conversions, new build-ing and, increasingly, offshore oil and gas construction.

The facility handles around 400 vessels in a typical year, most of them ULCCs (Ultra Large Crude Carriers) and VLCCs (Very Large Crude Car-riers). It completed 25 years of operation in 2008.

Several of the world’s larg-est dredgers and jack-up rigs are serviced every year and the yard has specialised LNG han-dling capabilities. Among the yard’s numerous claims to fame is the conversion work carried out on the Knock Nevis, the world’s largest crude carrier, and by most measurements, still the world’s largest ship.

Sitting at the helm of the Dubai operation is managing director Nawal Saigal. In a year when most comparable yards around the world have seen the order book wither away, an upbeat Saigal says the hype of the economic crisis has sur-prised him to an extent.

“People keep talking about the world being a different place, but I’m a firm believer that if you have a stable busi-ness plan then you are ready to deal with the troughs as well as ride the peaks. Business has not stopped, it may have slowed down, but it’s not ground to a halt. If you are good you still get your share.”

The Dubai yard is testament to this fact. The yard may not be at full capacity, but is currently executing five huge conversion jobs including two floating stor-age and offloading vessels, one floating production, storage and offloading vessel and a land-mark floating storage and regas-

ification unit, but more about those later.

Saigal says the firm is run along three core business streams. One is ship repair and ship maintenance, one is shop conversion, and the other is newbuilds. “About 50% - 55% of the business share is still made up of ship repairs.”

At a time when lines of credit for such expensive work may be thin on the ground, Saigal says that whilst not immune, such revenue streams are relatively untouched by the collapse of cheap credit.

“Repair work typically does not require credit or financ-ing from outside organisations,

COUNTRY FOCUS: UAE


COUNTRY FOCUS: UAE

The company began new-builds back in 1995, but made some major investments in capability and infrastructure to support this in 2002 and 2003.

“From that point onwards we became a real player in that field,” says Saigal.

The managing director explains that the newbuilds part of the business has come about thanks to a desire to capture more offshore oil and gas work.

Focusing on the offshore upstream business sector of course makes sense in the Mid-dle East, but other UAE yards have built solid reputations for

jack-up related work. In a rela-tively short stretch of coastline there are several world class jack up maintenance and fab-rication facilities, but the high concentration does not dampen Saigal’s enthusiasm for the mar-ket in this region.

“That is something we are looking into, and we recognise that there are players well into the jack-up market, but I think we can deliver a value added product in the years ahead. Some of the jack-ups in the region have really come of age, and will need replacements. Most of the operators in these waters are tied in with, or owned by government related entities, and ultimately we are here to serve the nation. We are, ulti-mately, a national asset.

Current oil and gas related work includes two FSOs for a joint venture between Euronav of Belgium and Overseas Ship-building Group (OSG). Each of them have put a ULCC into the yard’s massive conversion dock. The vessels measure up at 318 metres in length and 68 metres

the owners plan for this as part of the vessels lifecycle. Addi-tionally, when you look at con-versions, owners undertaking these jobs have good credit lines with their financiers and institu-tions built up over decades, and finally, newbuild owners tend to have the credit organised before they come to the yard.”

Saigal adds that owners have tried to tempt the yard into becoming strategic part-ners, taking a share in vessels built there, but the Dubai yard has chosen not to go down that route. “It’s flattering, but we have taken a back seat on that. I think that blurs boundaries.”

The Drydocks World group on the other hand has engaged in this sort of business, (See Seismic Shift on arabianoiland-gas.com).

“Today, clients are moving towards environmentally sound energy, so wind and wave related yardwork could well be carried out at the Dubai yard” Nawal Saigal

Drydocks World - Dubai is among an elite group of yards worldwide which can carry out simultaneous ULCC conversions to FPSO vessels.


COUNTRY FOCUS: UAE

The longest ship ever constructed recently retired from Qatar’s Al Shaheen Field is waiting for decommissioning in the Arabian Gulf.Name: Knock Nevis Owner: First Olsen Tankers Length: 458.45 m Draft: 24.6 m (fully loaded)Longer than: Empire State Building and Petronas Towers

KNOCK NEVIS - WAITING IN THE WINGS

beam. It is thought these vessels will eventually go to work on the Al Shaheen Field, operated by Maersk Oil Qatar, to replace the giant Knock Nevis.

In April last year, the first of two 16 000 tonne hulls con-structed for Aker Solutions was delivered from the Dubai yard. Considered amongst the most advanced drilling rigs of its kind, the H6E rigs will be able to drill in water depths up to 3000m, with a maximum drill string length of 10 000m. Asked whether the successful deliv-ery of the H6E hulls opened new doors to Drydocks World – Dubai, Saigal is unequivocal.

“Definitely. The end product that left this yard has made a real impact in the offshore industry. That’s where the market is mov-ing in the years to come, deeper

E&P work, and we have proved we are both capable, and lead-ers in this field.”

A reputation for on time and on budget high-end conversion work also helped deliver the Golar Frost vessel to Drydocks World – Dubai. The 290 metres by 48 metres regasification unit marks what Saigal says is just the beginning of a growing mar-ket for such vessels. The con-cept of FSRU vessels is widely regarded as providing shore based safety to terminals and population centres. Most cit-ies would rather not have large liquefied natural gas storage nestled amongst the population centres, for obvious reasons.

“Parking the vessel 30 miles offshore and pumping the gas in through a pipeline to the grid is much safer. More and

Saigal says capturing more of the offshore oil and gas work is in his sights.

more countries want to be safety conscious and reduce risk exposure to their citi-zens, so I think this is some-thing that we will see more of.” Emerging trends are a particu-lar focus for Saigal. Despite the yard’s impressive heritage in upstream, greener technology is a slice of the business he only sees growing, and the UAE’s increasing emphasis on this should position the yard to cap-italise on a whole new revenue

stream in the years to come. “Today clients are moving

towards environmentally sound energy, so wind and wave will come to the fore in time. We have strategic conversations about the future and wind and wave work will almost definitely be an arena we work in. With Masdar and the International Renewable Energy Agency IRENA coming up in Abu Dhabi, all these things are possible. It’s really exciting.”

28 Oil&Gas Middle East November 2009

COUNTRY FOCUS: UAE

L eading oilfield services provider AlMansoori Specialized Engineer-ing (MSE) has stuck to

its ambitious growth strategy in 2009, and is looking to con-solidate its position as an ambi-tious player in the Middle East throughout 2010.

The company, which has its principal yard in the Mussafah Industrial Zone, was established in 1977. “The company grew very rapidly and although that growth was in many different parts of the oil and gas indus-try, the core of our business has always been services,” says CEO, Nabil Alalawi.

“As we evolved we added more and more services and at the present time offer nine dif-ferent services to the industry. As well as the services we also got involved with trading and representing foreign compa-nies, who by law have to have a local sponsor. So we added a commercial arm to our busi-ness. Then as we grew we started producing some special-ised products for the oil and gas industry,” he adds.

Last year the company reor-ganised its many branches and split the company into two inde-pendent standalone companies. One is called AlMansoori Petro-leum Services and the other one is called AlMansoori Petroleum Industries. “There is a manager for each company who reports directly to me, so these elements of the business were essentially

LOCAL TOUCH PAYS OFFstreamlined. It was too unwieldy as one operation,” says Alalawi.

His vision of the next few years will see a renewed push into the supporting heavy indus-tries which typically sit side-by-side in other global oil hubs. “If you look at Aberdeen, for exam-ple, most of the products are being produced there for the North Sea. If you look at the Far East most of the products are being produced in Singapore. However, if you look at the Mid-dle East you hardly have any industries to provide support. So, we believe it is a fantastic growth area for us,”

Despite the reduced service and maintenance budgets of the major NOCs in the region, Ala-lawi remains focused on strong growth this year. “In 2009 we are on target to achieve 25% growth. This is excep-tional when you think some of our competitors have said that they are going to be 6% under forecast. We are very bullish and have set our-selves some formidable growth tar-gets. Every four years we double in size - and we are still doing it,” he beams.

The company is involved in several joint ventures, including the Global Chemical Company which opened its chemical man-ufacturing facility in Abu Dhabi this year, CORT SAS (Sulpho-nated Asphalt – a drilling mud additive), a revolutionary prod-uct being brought to the Gulf market.

The UAE’s homegrown oilfield service provider, AlMansoori, is determined to keep its phenomenal growth momentum up throughout 2009 and beyond

AlMansoori is targeting 25% growth this year.

“New technologies are important to AlMansoori in order to continuously improve our services and at the same time offer our clients the latest in the industry so that we can be competitive and innovative in the market place,” he concludes.

www.arabianoilandgas.com

“We are on target to achieve 25% growth this year. We have doubled in size every four years, and we are still doing it” Nabil Alalawi


COUNTRY FOCUS: UAE

A bu Dhabi has proved to be the regional rock amidst the global storm which lashed

much of the industry this year. Amongst those reaping the benefits of being on the ground in Abu Dhabi is Cor Corbeek, Emerson Process Management’s general man-ager for the Central Region, Middle East and Africa.

The energy business is a major driver for Emerson in the region, accounting for the lion’s

share of revenue streams. “In the Middle East around 60%, up to maybe 70% of our business is in the oil and gas industry. Petro-chemicals, chemicals and power make up much of the remainder for our central region business, and those sectors are growing too,” he adds.

With a reduced cost environ-ment, now seems like the ideal time to perform maintenance and upgrade programmes.

“Actually almost the oppo-site has been the case for us. After the oil price went down so much, ADNOC, and most of its national oil company counter-parts in the region, instructed all of their operating businesses to

CAPITAL CHOICEreduce their maintenance costs. That has impacted upgrade work considerably.”

This year’s still considerable oil-revenues have spurred activ-ity centres like Abu Dhabi to push ahead with new projects.

“A lot of our business comes from projects, and that has remained strong in the UAE. ADNOC wants to increase its production capacity from 2.5 million barrels per day up to 3.5mbpd, and that means a lot of new business,” says Corbeek.

One of those projects which hold immense opportunity is the Shah Sour Gas Field develop-ment, currently in an advanced stage of tendering.

“Shah is a huge project. They are still selecting EPC contrac-tors, but behind the scenes there is a lot of lobbying and positioning for those instru-mentation and automation pack-ages,” explains Corbeek.

Process automation only accounts for a small percent-age of the overall EPC bid, though on a US$10 billion project, that in itself is substantial.

Corbeek says that UAE appe-

tite and enquiries for the wire-less automation solution, Plant-Web, have been very strong, specifically with oil and gas related companies. “Takreer recently placed a large wire-less automation contract with us. Other heavy industries here in the UAE are also interested now, such as Dubal, so wireless has really taken off this year.”

Part of the appeal of the Plant-Web solution is that, thanks to its wireless properties, installa-tion costs are greatly reduced. However, it’s not just that cost benefit which is seeing demand grow. “It would not really be feasible to run cabling to many of the places wireless sensors can go. The PlantWeb solution opens new opportu-nities to improve mon-itoring capabilities, and that’s what is exciting the market.”

Brisk business in Abu Dhabi is steering the UAE down the path to recovery, says Cor Corbeek, general manager, for Emerson Process Management

Cor Corbeek, general man-ager, Central Region, Middle East and Africa, for Emerson Process Management

Corbeek is unequivocal about where the largest oppor-tunity sits in his region. “It is Abu Dhabi for sure. That’s where everything is happening. ADNOC has something like $50-$60 billion worth of capital projects on the table. Even from a regional perspective, not just a national one, the activity there, both upstream and downstream, it’s a genuinely prolific market right now. It’s really quite amaz-ing,” he concludes.


“ADNOC wants to increase its production capacity from 2.5mbpd up to 3.5mbpd, and that means a lot of new business” Cor Corbeek

Pre-Engineered Steel BuildingsLow-Rise buildings for all applications from warehousing to multi-storey shopping complexes and aircraft hangars.

Structural SteelSteel Structures and plate works for power, oil & gas, petrochemical and commercial applications including high-rise buildings.

Process EquipmentSteel and alloy process equipment including pressure vessels, heat-exchangers, storage tanks, reactor columns and others.

Towers & GalvanizingTowers for power transmission, radio and telecommunication and lattice steel construction for substations.


CRESCENTRISING

CRESCENT PETROLEUM

In 1969, two years before the Trucial States joined to form the United Arab Emirates, and pre-dating the era when National Oil Companies shot to the fore of the regional oil and gas industry, Sharjah-based Crescent Petro-leum marked itself out as a first-mover and incorporated itself as the region’s earliest indigenous, private energy company.

The company’s first major project was the Mubarak Field which is offshore Sharjah, which began production in 1972 and produced over 60 000 barrels

per day at its peak in 1976. In turn, that led to operations right around the world, at one point holding petroleum concessions in Argentina, Canada, former Yugoslavia, France, Tunisia, and the UAE and in the 1990s add-ing Egypt, Pakistan and Yemen to its global portfolio.

“Our diverse international operations throughout the 80s and 90s brought valuable experi-ence as an upstream petroleum company, in a wide range of operating conditions,” explains executive director of Crescent

Petroleum, Badr Jafar. From that global presence, the com-pany in the 1990s began a proc-ess of reining back its interna-tional positions, a strategic move in a turbulent time for the indus-try. “At least 40% of the world’s remaining gas reserves and 60% of global oil reserves are here in our region. We felt that with our well-developed core competen-cies, and being an indigenous Middle-Eastern upstream opera-tor with regional business know-how, meant we had advantages over many of the IOCs (Interna-

Exclusive: Badr Jafar, executive director of Crescent Petroleum, speaks candidly about Iraq, the need for gas liberalisation, and arbitration with Iran’s national oil company


CRESCENT PETROLEUM

“After 4 years of intensive negotiation, we signed a long-term inter-nationally binding gas supply agreement with the National Iranian Oil Company (NIOC) in 2001. Both sides invested over 2 billion dollars in facilities in our respective countries to prepare for this project. Due to huge delays on the upstream development in Iran, which was being carried out by NIOC’s contractors, that gas which was due to commence delivery in Dec 2005 has not been supplied yet. The pipe-line is built and connected, the upstream facilities are in place, but the commissioning of their facilities has not yet been completed. We were extremely patient with NIOC’s contractors’ delays; however, we had relied upon this contract and committed to our customers as a result. NIOC is now almost four years late. As a result, and because of the stress that this delay was placing on our customers, we felt we had no option but to proceed with the arbitration route to seek independent judgement on specific performance to put an end to negative public debate, and that’s where we are today. We always strive to maintain good relations with our contractual counterparties, but contractual commitments are just that, and business is business. We are totally confident about our contractual position. Incidentally, NIOC has never defaulted on an internationally binding contractual commitment and we don’t expect that NIOC will start reneging on its deals now.”

BADR JAFAR - IN HIS WORDS: THE IRAN GAS DEAL

tional Oil Companies) operating here,” he says.

A coveted presence in the most prolific hydrocarbon region in the world remains the ultimate aim of IOCs from across the globe, but entry into National Oil Company interests comes at a price many deem steep. Better to be known as a local company, says Jafar.

“We decided to bring back our original focus on the Mid-dle East and North Africa. Over the years, we divested these operational assets and brought the core of our busi-ness back home.”

In the 1990s the company pioneered the development of a real Middle Eastern integrated project by recognising the region, even then, was head-ing towards a gas imbalance. “There was an emerging dispar-ity between gas rich producers and energy hungry gas short markets. As a company we saw that disparity would continue and exacerbate.”

Initially the company began looking at filling that gap, start-ing with the major asset hold-ers, Qatar and Iran. “As a pri-vate sector company we wanted to facilitate the supply from those countries into the gas short regions in the Gulf and beyond.” Widening its net, the company also began looking at hugely ambitious interna-tional projects, such as feeding the energy hungry India and Pakistan markets with surplus Middle East gas.

The Gulf-South Asia Gas Project (GUSA), first launched by Crescent in 1990, was the first workable scheme for pro-ducing, transmitting by pipeline and delivering natural gas from Qatar to South Asia and was ini-tially developed by Crescent to

service markets in the UAE as a result of rapidly increasing gas demand. Due to prevarica-tion in Pakistan over the years, the project has yet to come off the drawing board and enter an execution phase. “Pakistan missed the opportunity which would have saved the coun-try over US$50 billion at cur-rent prices,” Jafar says. When this project did not go ahead the Dolphin project emerged and implemented the Qatar-UAE pipeline. “The Mubadala-led Dolphin project did a great thing to engage with this oppor-tunity, and the benefits and suc-cesses of this particular project are evident to all,” Jafar said.

The desire to build a truly regional, private sector, but pub-licly listed gas company spurred the development and launch of Dana Gas in 2005. “Dana Gas was the first and still is the only private sector and publically listed firm really concentrat-ing on the full natural gas value chain and with a regional focus in the MENASA (Middle East, North Africa, and South Asia) region,” he says.

Crescent Petroleum essen-tially became the founder of pri-vate-sector monetising of the region’s natural gas, and is striv-ing to deliver value through-out the value chain. “From upstream, through midstream distribution and transporta-tion, even into downstream gas processing and facilitating gas based industries, we as a local regional company have sought to realise the maximum added-value of locally-produced gas, as opposed to focusing just on exports as many IOCs tend to do.”

Crescent Petroleum, as the key founder, holds around one fifth of the stock in Dana Gas. The gas project in the Kurdistan Region of Iraq came together in record time.

November 2009 Oil&Gas Middle East 35

CRESCENT PETROLEUM

Badr Jafar is executive director at Crescent Petroelum, and chairman of Gas Cities and Pearl Petroleum.

The scale of enthusiasm for the company is undeniable, judging from the IPO which attracted US$80 billion in less than two weeks, setting a world record for an IPO over-subscription.

Traditionally, gas reserve development partnerships in the Middle East with IOCs tend to be based predominantly on the concept of sourcing energy for exports. With nat-ural gas,

ing in Iraq, Egypt and most recently Yemen.

The idea of a country using its gas is a relatively simple concept, but Jafar is passion-ate about how much such a basic change could transform regional gas, and gas-based industries. He concedes that export has many positive effects beyond the cash flow, and that better use of gas domestically, whilst a priority, should not rule out export deals where reserves are sufficient to sup-port both.

“I’m not saying everything should be hoarded for domes-

tic consumption. Gas is a great facilitator to build political and economic bridges between two countries. I think that gas has something that oil doesn’t and that is the fact it can act like an umbilical cord between two nations, which in-turn pro-motes long-term stability and good relations between them because the economic impera-tive is there.”

GAS LIBERALISATIONOne topic which comes to fore in conversations with Jafar is

the real and pressing need to liberalise gas markets

in the region. Popula-tion growth and ram-

pant economic development is driving a huge demand increase for desalination,

and the growing burden of air conditioning the region in sum-mer.

Of course, the Middle East is more fortunate than much of the rest of the world, in that it has the resources to hand to support these demands, but without a liberalised pric-ing structure, a vast amount of those assets will be squandered in the years ahead.

“Regionally speaking, nat-ural gas rich countries are underselling their product to subsidise power generation and many of the downstream projects. In my opinion, without

gas market liberalisation going forward there is little prospect of the Middle East to capitalise fully on its reserves. Why? Sim-ply because artificially low gas prices have a double-whammy effect. On the one hand it increases demand unrealisti-cally and leads to wastage with-out regard to conservation and the detrimental environmental impact, while on the other hand robs our people of the eco-nomic incentive to develop our vast reserves,” he says.

Meaningful reform in the Middle East will require a dra-matic shift in regional govern-ment’s long term policies. In order to promote the diversi-fication of economies, most of the Gulf States have for a long time set gas prices well below unsubsidised market rates to support their rapid expansion

that usually entails export pipe-line projects when markets are close, and LNG shipping for far-ther export markets. “Once that gas molecule reaches the bor-der you’ve exchanged its value and that’s it. However, by using that molecule locally, whenever possible, you maximise the net-back value of that gas, and that has a major economic multiplier effect,” enthuses Jafar.

This logic led to Jafar establishing Gas Cities

LLC in 2007, a joint ven-ture between Crescent Petroleum and Dana Gas, which is develop-ing mega gas-based industrial cities in the region, based on the concept of

clustering. Jafar, also chairman of Gas Cit-

ies, says “The Gas City concept is unique in that

it is a private-sector ini-tiative that provides a one-

stop-shop for gas-intensive industries and communities in an integrated and energy efficient environment.” Gas Cities is now well on its

way to signing up a number of

these cit-ies in the

region, includ-

“Gas has something that oil doesn’t, and that is the fact it can act like an umbilical chord between two nations which then promotes long term stability” Badr Jafar



CRESCENT PETROLEUM

and building of nascent indus-tries. Additionally, consumers have been largely blessed with access to low price, heavily sub-sidised electricity and water.

“What happens in this situa-tion is that the provision of low cost electricity and gas feed-stock to consumers and down-stream industries becomes eco-nomically unsound when all the other factors are included in the picture, such as population growth and future power gen-eration investment. This then leads to major drains on gov-ernment budgets and its abil-ity to keep subsidising, which in turn leads to gas and power shortages, eventually heavily taxing the consumer.”

Despite the political implica-tions of charging the real price for power, water and fuels, it is a topic which has sailed up the agenda across the Middle East. Egypt and Iran have already seen proposals drafted at the highest levels of governments.

However, political will is just one bump on the road to a fully liberalised natural gas mar-ket. If one jurisdiction hikes its gas prices, the temptation for energy intensive industries would surely be to locate to a cheaper environment. Jafar does not seem deterred.

“We’ve seen in the past that a unified approach doesn’t nec-essary work in this region, or even worldwide for the gas industry for that matter. What drives fundamental shifts in pol-icies is first movers. You have to set examples, and we have done that in the past, including when we pioneered the region’s first two cross-border gas pipeline deals in the 80s.”

The landmark deal Jafar is referring to was the Sharjah to Dubai onshore gas transmis-sion and supply project pro-moted by Crescent in the mid 80s, followed a few years later by an offshore pipeline built and owned by Crescent. Back

then, Dubai burnt liquid petro-leum fuels for power generation in the summer, whilst in Shar-jah gas was being flared.

“Crescent came in as a pri-vate company to talk to the Dubai government. The logic was simple. At the time the price Dubai was paying for fuel oil was approximately $2.50 per MMBTU. We were burning the gas at zero value! Between the willing buyer and the will-ing seller, we ended up splitting the difference. So the very first cross border sale of gas in the Middle East was set at $1.25 per MMBTU. Unfortunately this mindset with gas pricing continues until today where the

alternative is more than seven times what it was back then, ultimately to the detriment of the consumer and producer.”

Jafar says that when Saddam Hussein was looking to sell gas to Kuwait in 1989, the Ministry had no idea what to charge for it. So he asked his Ministry to look for precedents and they came and found the Crescent Petroleum gas price to Dubai, and so the Iraq-Kuwait price was set at the exact same $1.25. When the Dolphin Energy pipeline began deliveries the price was thought to be in the $1.25 - $1.35 price range, at a time when energy commodities were trading at record levels.

“In my opinion, without gas market liberalisation there is little prospect of the Middle East to capitalise fully on its reserves”

Crescent Petroleum began life producing oil and gas from Sharjah’s Mubarak Field in 1971.


CRESCENT PETROLEUM

“This illustrates that the mentality in this region is usu-ally set by first movers. Gas is more efficient, cleaner, cheaper, and producers need to start to set prices at a rate that is mutu-ally beneficial for everyone in the region in the long-term, and I don’t think this will happen if we wait for a unified approach. It just needs to get done. When it is successful, it will then be used by all as the correct and sustainable benchmark.”

NEW IRAQAmongst the most well-known activities of Crescent Petrole-um’s group of companies is it’s participation in Iraq’s Kurdis-

tan Region. Crescent Petro-leum is in partnership with its affiliate Dana Gas, and is cur-rently implementing a major integrated natural gas project there. The company is work-ing under a risk service agree-ment with the regional authori-ties to, as a first phase, produce, process and deliver 200 million cubic feet per day of gas sup-plies urgently needed for power generation free of charge to the government, in return for guar-anteed off-take of associated liquids by the government, and subsequently to ramp up pro-duction of petroleum for local sales and eventual exports. The Kurdistan interests are cur-

rently held by Pearl Petroleum, of which Crescent Petroleum and Dana Gas are the major stakeholders, with Austria’s OMV and Hungary’s MOL each acquiring minority stakes earlier this year. Pearl Petrole-um’s interests are concentrated on the Khor Mor and Chem-chemal gas fields in the Kurdis-tan Region of Iraq.

The combined project invest-ment of around $700m (spent to date) is the largest private-sector investment ever under-taken in Iraq, and involves the fast track appraisal and develop-ment of the gas fields, construc-tion of two LPG plants and lay-ing of 180km of pipelines. The project will sustain two power plants to generate 1250 MW providing cost effective elec-tricity for over 4 million Iraqis, freeing the extra 300 MW of electricity to other provinces and saving Iraq over $2.5bn a year in fuel subsidies. “We were asked by the Prime Minister of

the Kurdistan Regional Govern-ment to assist with a problem they had. They had contracted two Independent Power Plant projects (IPP) – one 500MW plant and a 750MW plant – and as is standard, they guaran-teed feedstock for these power plants. The plants were one year away from completion, with no gas supply which was promised to them by the central govern-ment, in sight,” explains Jafar. That presented two problems for the Kurdistan Regional Gov-ernment. First, contractual obli-gations to provide gas for the IPPs, and second, it had prom-ised the people of the region, who were greatly neglected during Saddam’s era, that they would have electricity.

“They requested us to come in and solve this major prob-lem. We quickly undertook major studies on two fields, which at the time had uncertain reserves, but were good candi-dates. On this basis, we entered

$700 MILLIONSum invested in pure equity by Crescent Petroleum in KurdistanSource: Crescent Petroleum


CRESCENT PETROLEUM

into a risk service agreement which provided for the very fast-track appraisal and devel-opment of these fields, as well as installation of all the related facilities and infrastructure.”

The company rapidly embarked upon getting the fields ready for production, and building the 180km of pipeline in difficult rocky and mountain-ous terrain. “We literally had to move mountains, clear many square kilometres of minefields, and import over 65 000 tonnes of equipment into Kurdistan, all in record time!” explains Jafar.

The initial risk service agreement was signed in April 2007, and by the end of sum-mer 2008 Crescent was deliver-ing gas. That gas is now feeding turbines, which in turn is pro-viding much needed electricity to over 4 million Iraqis.

On top of the gas needed to fire up the power stations, recent appraisals of the fields have revealed that the reserves are sufficient to support local industry, and also enough to export. “During our efforts on the appraisal we discovered that the reserves in place could satisfy not just local - which is the priority - but also paral-lel export plans,” beams Jafar. Kurdistan is a landlocked coun-try, but neighbours gas hungry Syria and Turkey. Crucially, of course, Turkey is a gateway to Europe. “Natural gas, unlike oil, is worth nothing unless you develop markets for it, and this is what we have set out to do for the region.”

The addition of OMV and MOL, central Europe’s larg-est energy companies, is par-ticularly exciting for Jafar. “The great thing about this partner-ship is that it brings four private-sector energy companies, two

from the Middle East and two from Europe, together with the support of host governments, to create a market for this gas and bring excess Middle East-ern gas supplies to Western Markets,” he says. The JV com-pany, Pearl Petroleum, (which Jafar serves as chairman), is

an integrated natural gas part-nership with 40% Crescent, 40% Dana Gas, 10% MOL and 10% OMV shared ownership.

Whilst declining the oppor-tunity to reveal the full extent of the resources at the Khor Mor and Chemchemal Fields, Jafar notes that the often cited figures of between 2.2 and 4

“Natural gas is a great facilitator to build political, social and economic bridges between two countries” Badr Jafar

Crescent began its earliest operation in the Mubarak Field, offshore Sharjah in 1971. The fi eld peaked in 1976.

trillion cubic feet may well fall short of the real figures.

“Those figures are based on estimates published by the Ministry of Oil in Baghdad from studies done a long time ago. Nothing has been done since. Based on our extensive appraisal work we felt con-

fident enough to announce that we would be in a position to produce and supply over 3.5 billion cubic feet of gas daily from these fields combined, which would leave ample sup-ply left after satisfying local requirements to support addi-tional export projects, such as the Nabucco Project.”

MEGA-PROJECTThe Nabucco project repre-sents a new, 3,300 km gas pipe-line connecting the Caspian region, and Middle East via Turkey, Bulgaria, Romania, and Hungary to Austria, and further on to the Central and Western European gas mar-kets. When the project was ini-tially conceived, it was thought the main source of gas supply will be the second stage of the Shah Deniz gas field in Azerbai-jan, slated to come on-stream in 2013, but that date has since slipped to 2016.

Slow progress on the Azerbaijan projects has opened a massive opportunity to Pearl Petroleum. Through Turkey, the Khor Mor and Chemche-mal gas-condensate fields in Kurdistan will now at least be able to provide the initial sup-plies of gas to Europe, and potentially substantially more. “Initially 2014 was announced


CRESCENT PETROLEUM

by the Nabucco consortium as an aim for the Nabucco project to commence gas supplies. At that time they were relying pre-dominantly on Azerbaijan and Turkmenistan. The estimate of supply from those countries recently got revised to 2016. More recently the Nabucco management announced they are sticking to 2014 because the first gas supplies will be coming from Northern Iraq, which is the Pearl project,” says Jafar.

Despite the political, logis-tical, and financial challenges that lay ahead, Jafar is confident in Pearl Petroleum’s ability to deliver gas to Europe.

“We will absolutely not be the bottleneck in terms of sup-plying Nabucco, or any other European projects that get their act together.”

Constitutional wrangling and uncertainties surrounding Iraq’s Hydrocarbon law, has kept many players out of the Iraqi energy arena, but Jafar remains utterly confident in the company’s presence, and role in the embattled nation.

“We providing a tremen-dous service to the Region and are operating fully within the bounds of the Iraqi Constitution which has been ratified by over three quarters of the popula-tion, and the Kurdistan Oil and Gas Law which is constitution-ally recognised. We are fully confident of the legal, technical and moral status of our opera-tions in Iraq. We wouldn’t have invested over $700 million dol-lars in pure equity if we had not been comfortable with that!” he concludes. Over 180 km of pipeline has been laid for the Pearl project in Kurdistan.


QATAR FOCUS

Saad Al-Mohannadi, deputy managing director of Maersk Oil Qatar speaks exclusively to Oil & Gas Middle East as completion moves into sight for the giant Al Shaheen expansion project

STARTTO FINISH

QATAR FOCUS

$6bnPROJECT


QATAR FOCUS

Saad Al-Mohannadi surveys a scale model of the 2005 FDP expansion project.

wouldn’t normally experience. I would say the biggest challenge is to adapt to the daily, evolving challenges to remain on time and on budget whilst maintain-ing significant up-time in our production operations. Seeing the progression of the Al Shaheen field development from start to finish is hugely rewarding though. I’ve been involved from the very begin-

which is currently about 90% complete and of the cooperation with Qatar Petroleum, which has enabled such progress. 126 out of 169 planned long hori-zontal wells have been drilled within the FDP 2005; the drill-ing campaign is 75% complete. This includes the world’s long-est well at a depth of 40,320 feet drilled in May. Also, Seven of fifteen platforms (weighing 140,000 tonnes in total) have been installed, with the remain-ing eight either in the process of being installed offshore or to be loaded in Asia and the Mid-dle East for offshore installation later this year. Jackets have been installed for seven of the eight outstanding platforms. Final hook-up and commissioning will take place in early 2010. On top of this, the laying of 300km of inter-field pipelines and 50km of subsea cables has been finalised and these are currently being tied-in to the completed plat-forms, and a major 3D seismic survey, including interpretation of the data has been finished.

What are your goals this year?SAM: Our goal is to continue with the progress we’ve been making, without accidents and without any significant delays. We’re currently in the last phase of work and I would say our main goal is to simply focus on the successful completion of the project - around the end of Q1 next year. Our major milestones from 2009 include the installa-tion of four major decks includ-ing the largest (13,500 tonnes) in the Middle East later this year. The commissioning of a central utilities platform including the power generation plant supply-ing 32 MW of power to the satel-lite platforms is significant, and

commencing oil production and gas compression through new central processing platforms is a big step forward.

What is the most chal-lenging part of your job?SAM: In the beginning of this project we set out to do some-thing that had never been done before, that clearly brings chal-lenges on a scale that you

The Al Shaheen Block 5 field, which sits just shy of 80 kilometres off the Qatar coast has seen oil

production grow to over 300 000 barrels per day, and for a time was generating Qatar’s largest hydrocarbon revenue stream.

The Field Development Plan (FDP) signed in 2005, has posi-tioned Maersk Oil Qatar at the heart of QP’s oil producing future. The extension project, (2005 FDP), aims to increase production beyond the 330 000 bpd recorded in 2008, and includes an investment package estimated at US$6 billion, which covers EOR expenditure as well as infrastructure investment.

The 2005 FDP is a huge undertaking. The project encom-passes the drilling of more than 160 production and water injec-tion wells over a six year period. Fifteen new platforms were required, (several currently on barges inching their way towards Qatar’s waters from overseas international contrac-tors). These platforms are to be twinned with accommodation and production facilities and the whole project interconnected by subsea pipelines.

Saad Al-Mohannadi, deputy managing director of Maersk Oil Qatar reveals where the landmark project is at today.

How is the expansion plan progressing?SAM: We are currently on schedule with the FDP which is a real achievement consider-ing the size and complexity of the FDP, with significant instal-lations and hook-ups taking place, whilst maintaining high levels of production uptime. We’re understandably pleased by the progress being made

“A highlight for me was being in charge of the fi rst shipment of crude oil from the Al Shaheen fi eld in 1994, to see and realise we’d been successful and acheived our goal”


QATAR FOCUS

ning when there was nothing. I’ve since watched the company and this project grow steadily with no breaks in development, which is a real achievement.

: If you had to pick one moment as an absolute highlight of your time with MOQ, what would it be?SAM: There’s so many to choose from! One that stands out is being in charge of the first shipment of crude oil from the Al Shaheen field in 1994, to see and realise we’d been suc-cessful. Also the drilling of the world’s longest horizontal well in 2008 at 40,230 feet (12.3km) marked a real milestone in our capabilities as a company.But the real highlight has been my involvement with the first Field Development Plan (FDP). It was an exciting and challeng-ing time, we had really good sup-port from HH the Emir Sheikh Hamad bin Khalifa Al-Thani and Deputy Prime Minister and Ministry of Energy and Indus-try HE Abdullah Bin Hamad Al-Attiyah. We were embarking on a project that if successful, would give and enormous boost to the country’s economy.

What was your back-ground prior to joining MOQ?

SAM: I joined Maersk Oil Qatar in 1993 from Qatar Petro-leum, becoming the Deputy Managing Director in 1996. I have a background in opera-tions with QP with a BSc in Petroleum Engineering.

I was given the opportunity to join Maersk as a position for a Senior Qatari was available. At the time, Maersk Oil was virtually unknown in Qatar; a small company which few had heard of. At that time it was a risk to join such a company and many didn’t believe that Maersk would succeed in developing the Al Shaheen field. However, I believed in their potential as the geological conditions of the North Sea, which Maersk Oil had been developing over the previous decades, were similar to the Al Shaheen Field to some extent. They also had an expe-rienced team involved with the development of the field and who would share their knowl-edge on cutting-edge technolo-gies new to Qatar at the time, such as long horizontal wells. This made me ready to take on the challenge.

Saad Al-Mohannadi is deputy managing director at Maersk Oil Qatar.

40,320 feetMaersk Oil Qatar drilled the world’s longest well in May 2008.

140,000 tonnesWeight of the 15 platforms which have been installed to date.

AL SHAHEEN IN NUMBERS


UPSTREAM LOGISTICS

SHIFTING GEARChallenges in the logistics industry are plentiful, but throw in outsized oil and gas cargo and finance driven deadlines, and things can step up a notch

UPSTREAM LOGISTICS


Outsized cargo readies for its departure from Abu Dhabi to be shippied to Asia.


Logistics in the oil and gas industry can be much more complex than in any other sector. Sheer

weight, complexity, or quantity of items being moved makes the whole process a challeng-ing one.

Besides the issues surround-ing the size and shape of the cargo, there are also major chal-lenges in their final destination. Often these are integral parts of oil and gas equipment and need delivering to remote locations in short time frames, and under huge pressure.

Despite this, there is no short-age of companies taking up the challenge. One such company is GAC, which has been involved in the oil and gas sector in the Middle East region since the 1950s. “We pride ourselves on having helped build the region’s oil and gas infrastructure ‘from the seabed up’,” explains GAC group energy logistics manager Ismayil Manzil.

“We are unique in the energy sector in being able to provide service packages that integrate a range of services across ship-ping, logistics, and marine serv-ices that can be tailored to spe-cific client demands wherever

the project is. GAC Energy was created in 2008 to provide a sin-gle point of contact and bring the range of our services under a single umbrella,” he adds.

Another company involved in the sector is TNT, which oper-ates a global import and export system of road vehicles and air-craft for transport and a support network for managing the cus-toms and paperwork flows. In the UAE the firm also operates warehousing facilities in JAFZA for storage and redistribution.

The firm’s major challenges derive from the tight deadlines and short time frames being operated within upstream logistics.

“It would be easy to focus on the size of oil and gas pieces and the weight causing handling concerns, however, that is a day to day process,” says Bryan Moulds, country general man-ager, TNT Express UAE.

“The most chal-lenging part of serv-icing the oil and gas sector is the time sensitivity of some of the move-ments, matched to the distances and borders that some of the ship-ments have to cross. Added to the paper-work for tem-porary exports and managing the expiry dates of

pieces on loan some days can be more exciting than others,” he adds. Manzil agrees that the majority of GAC’s chal-lenges revolve around time and, more specifi-cally, the occa-sional lack of it. “We always talk about the value of time

“Time is a huge factor, especially if there are spills or breakdowns. That is massive, because you have to get the aircraft in the air very quickly” Eliska Hill, general manager, Chapman Freeborn.


UPSTREAM LOGISTICS

Bryan Moulds, country general manager, TNT Express UAE.


UPSTREAM LOGISTICS

at every opportunity. In a time-sensitive market, the value a logistics provider adds may be measured in days, hours or even minutes. Only experience and planning can help us meet the expectation of the industry.

“Like in any other busi-ness GAC is involved, we don’t treat our customers as an out-sider but we are part of them to ensure we add value constantly. We work and plan with the cli-ents, and follow-up on every stage of the process to ensure success,” he states.

Manzil adds that this can mean great difficulty in making sub contractors and authori-ties appreciate the importance of the time factor for the com-pany’s clients. “It is not uncom-mon that delays could cost US$50 000 or more per day, and in some cases that figure can pass the million dollar mark, so time is of the essence,”

Time is the crucial factor in all of the operations involv-ing oil and gas equipment, Eliska Hill, general manager, Dubai, Chapman Freeborn, reveals: “Time is a huge factor,

especially if there are spills or breakdowns. That is massive, because you have to get the air-craft in the air very quickly and you can be dependent on the piece being manufactured or made available.”

Abnormal Load Engineering (ALE) is a worldwide logistical engineering company which is heavily involved in the oil and gas sector. “We are an engineer-ing company which specialises in transportation and installa-tion of heavy loads, we are not a transport company, and that is a big difference from some of our competitors,” James Rob-erts, regional commercial man-ager, ALE, says.

While GAC and TNT are in the air, Roberts is using the roads and the seas to trans-port heavy equipment, with the roads in particular presenting challenges. “I think because it’s a rapidly developing region, the road networks are constantly changing which results in unforeseen challenges.”

While it may be a day to day process, the awkward shape and size of the cargo being

handled is undoubtedly a big challenge. Stuart Smith, cargo sales director – Middle East, Air Charter Service explains: “Large heavy outsized awk-ward pieces of equipment are a big challenge. You have often got really awkward long pipes, the biggest piece we had was a 13m piece of pipe and trying to maneuver it into the aircraft can be difficult.”

Air Charter Service pri-marily uses Russian planes to transport oil and gas equip-ment, as it claims they offer the best option when trying to fit huge pieces of equip-ment into an aircraft. However, there are further issues caused by these as regula-tions can restrict the use of certain aircraft. Russian air-planes can be old airplanes; not all of them are old but aviation is constantly evolving, and from time to

time sometimes aircraft will be restricted in certain areas, mostly due to noise restric-tions,” explains Smith.

RESTRICTIONSFurther restrictions exist on which aircraft can land in par-ticular airports. “You are tied into airports when you are fly-ing by air, some of the larger aircrafts can’t land in regular airports. It’s a difficult one,” reveals Hill.

Onshore locations of oil and gas facilities can sometimes be extremely remote. This is an opportunity for logistics com-panies to again show versatility. Some sites in onshore drilling locations

Nikolai Sorensen, general manager, Boxit.

GAC owns a fl eet of marine logistics vessels which serve the Arabian Gulf offshore industry.


Eliska Hill, general manager, Chapman Freeborn.

BBC Chartering, Dubai

Phone +971 4 355 1910

[email protected]

BBC Chartering, Singapore

Phone +65 6576 4130

[email protected]

Your heavy lift and project cargo expert

For further information please visit us online or contact:


UPSTREAM LOGISTICS

do not even have access roads. “So our job starts with work-ing with the clients on build-ing access roads to ensure easy access for the supplies to the site,” stresses Manzil.

“Having been in the region for over half a century, perhaps we can safely say that nothing can really catch GAC by sur-prise! This is a highly demand-ing environment where preci-sion in planning and execution are critical. At the same time, backed by our extensive experi-ence and expertise in this field, we have the flexibility to respond to last minute client demands or changes in circumstances.”

Due to the complexity of some of the processes in logis-tics in the Middle East, the serv-ices offered by firms here have actually expanded. “We recog-nise this is the Middle East, and Middle East shippers in particu-lar appreciate all inclusive solu-tions,” comments Smith.

“We get involved in that by having airport agents at many of our hub points, we can appoint nominated agents in airports of arrival. We can send repre-

sentatives and managers, we can tailor the service according to the position of the company. If it is a big oil and gas com-pany they tend to want an all inclusive service.”

Claudio Lietaert, passenger charter analyst, Air Charter Service, reveals: “We are a very global company, we have around ten offices worldwide, which I think is an advantage we have over local competitors. There is nowhere we don’t cover, other-wise what is the point in char-tering?”

“We often arrange the pickup if it is coming out of a freezone. We can do the trucking pick up, with specialist vehicles and take care of everything from the shipper at the end,” says Hill.

“You have to have local knowledge of the area and the problems; if you are moving things in and out of the UAE, it can be a challenge especially with dangerous equipment. We have operational staff who deal with all of that, the papers and the documentation,” she adds.

UPSTREAM EXPANSIONWhile some of the firms in this industry such as Abnormal Load Engineering and GAC treat oil and gas as their primary focus, others are also involved in other areas, although oil and gas is usually an area these companies want to be more involved in.

The ChallengeKuwait’s own gas supplies are not enough to generate the power needed in summer when air conditioning units are at full blast. To cover the short-fall, Kuwait signed a US$150 million contract with Excelerate Energy to build import facilities for liquefied natural gas (LNG) at Mina Al-Ahmadi about 40 kilometres from Kuwait City. The Excelerate Energy supplies are based in several countries in North America, Europe and Asia.

CASE STUDY: SHIFTING LNG FACILITIES FOR KUWAIT’S MINA AL-AHMADI The SolutionParts and equipment for the project shipped from various origins including the USA, UK, Italy, Holland, Belgium, Canada and Korea.

GAC helped Kuwait meet its high summer demand for electricity by handling all the parts and equipment ship-ments for a new natural gas import terminal.

Air Charter Services calls in the Antonov 225 for upstream project cargo.

250TONNES

The only Antonov 225 in service can lift a payload of 250,000 kilo-grammes at takeoff.Source: ArabianSupplyChain.com

“We have a wide range of ver-tical markets but oil and gas is an important part, accounting for around 10% of volumes. This year’s challenges with the econ-omy have meant that oil and gas become more interesting due to the stability of the sector,” explains Moulds.

“It’s not a huge part of us, because it’s a very ad-hoc busi-ness. Perhaps 10-15% of our cargo, so we are working on get-ting more and developing that in the Middle East. We are defi-nitely targeting it and that is an area where we want to do more work,” affirms Hill.


UPSTREAM LOGISTICS

Cross border logistics opera-tions can present major tests to a firm’s capabilities, particularly with the clock ticking. Problems can arise in this regard, on both land and in the air. “The prob-lem in this part of the world is that airspace is very much a point of national pride, where each country tries to protect its airspace,” reveals Lietaert. “They don’t like to see aircraft

from certain countries overfly other countries let alone land somewhere. When you have an aircraft on route and you get a call from operations saying you cannot fly across a country, you have a problem.”

Smith suggests a solution to this problem may be an open skies policy in the Middle East, to increase trade between coun-tries in the region.

There are many challenges being faced by these companies on a daily basis.

However, it seems it is these situations that get logis-tics industry members out of bed in the morning. Roberts describes the most exciting part of his job as “trying to find solu-tions to complex logistic situ-ations”. In essence the job is a problem solving one, however,

with a fast ticking clock and an awkward cargo, the oil and gas sector is permanently keep-ing the logistics industry on its toes.

“No single day is comparable to any other day. You are see-ing different challenges and dif-ferent opportunities every sin-gle day. What more does one need to be excited?” concludes Manzil.

Project ExecutionGAC was entrusted with door-to-door handling of all shipments whereby the logistics team took care of the logistics from all the origins including customs clearance all the way through to final delivery to Mina Al-Ahmadi GasPort (MAAGP) project site in Kuwait. In all, GAC has flown in 900,000kg of cargo and shipped in 125 TEUs for the project.

The OutcomeAll the client needed to do is issue purchase orders and leave a copy with GAC. The Kuwait office was following up every purchase orders with the origin office to ensure that the parts were in the site at just in time without increasing the transport cost or timeframe.


COUNTRY FOCUS: UAEUPSTREAM LOGISTICS

Moving giant oil and gas installations from hub to hub falls to the capable hands

of specialist project shipping firms. One such firm growing its regional operations and presence in the Middle East is BBC Chartering. Despite the disastrous year container shipping has suffered, Denis Bandura, managing director of BBC Chartering MidEast, says that project shipping de-mand in the Gulf has remained strong.

“Project cargo is pretty much 100% of our business, and oil and gas and mining make up a huge proportion of what we do. We do carry other cargo’s, such as bulk shipping, but that’s tra-

ditionally a repo-

MARITIME MOVERSsitioning cargo for us,” explains Dubai-based Bandura.

Inbound project logistics into Dubai in recent years has been huge business for the company, but strong links with oil and gas projects has kept the volumes up throughout the downturn.

“Our vessels can lift up to 500 tonnes, which covers all but the heaviest outsized cargo for the oil and gas business.”

The notion of lifting, through cranes attached to the vessel, a 500 tonne piece of kit worth several million dollars seems tricky to say the least, but Bandura says technological developments in positioning and monitoring onboard BBC’s fleet of ships take such loads in their stride.

“When lifting something very heavy the ballast tanks are flooded so the ship sits lower in the water, this way it’s more balanced and incredibly stable. The pumping system onboard shifts water around the vessel if it starts to list (lean to one side). Modern systems are so efficient they can keep the ship balanced to within a few centimetres, even

during the heaviest lifts.”Since establishing an office in the Gulf five

years ago, Bandura says the business

has gone from strength to

strength. “We have seen very steady growth in the Gulf over the last three years in particular, with volumes in the region up by around 35%.”

Although project work for the oil and gas industries has domi-nated the regional flow of cargo, some project shipping jobs con-tinue to surprise. Today the region’s exports go way beyond just liquid hydrocarbons. “As the Gulf economies have diver-sified, cargo flows have begun to change, which is interesting. We shipped the stadium for the 2010 World Cup final in South

Africa next year. It was pro-duced in Kuwait,” Bandura adds.

BBC Chartering has seen steady upstream project cargo volumes in 2009

The biggest single market is, unsurprisingly, Saudi Ara-bia. “Abu Dhabi has been busy recently, but Jubail is possi-bly the busiest port for project movements in the Gulf – almost all of it inbound, very little come out!” explains Bandura.

Asset repositioning plays a big part in the upstream cargo BBC moves. “We deliver off-shore and onshore rigs from Houston into Jebel Ali, and then after maybe six months we might be asked to reposi-tion it to Malaysia. Wherever the demand for drilling is high-est we deliver for owners such as TransOcean.”

From January to May of this year, BBC Chartering Middle East actually carried more cargo than in 2008. “Margins have been eroded to a certain extent, but it’s still at a very reasonable level for us today. Globally, this region is performing very well,” concludes Bandura.

Denis Bandura is managing director of BBC Chartering in the Middle East.

Some BBC Chartering vessels have a lift capacity of 500 tonnes.


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UPSTREAM LOGISTICS

T ransportation specialist Beluga Shipping was founded in 1995 and offers heavy lifting and

transportation services. The Beluga team consists of

1300 seafarers and 500 experts, experienced in chartering and engineering. The firm provides tailored transportation solu-tions that are professionally con-ducted worldwide.

“Whether it is a long and heavy demethanizer, a com-plex defractionator, structures and equipment for offshore platforms, modules for a plant system or a dismantled plant itself which has to be shipped, whether the cargo has to be loaded from the pier onto the

MOVING MOUNTAINScarrier or discharged from the ship onto a barge offshore, Bel-uga Shipping offers creative, safe and sound solutions,” Niels Stolberg, president and CEO of Beluga.

Among the many projects undertaken by Beluga, Stol-berg lists the transportation of a particular buoy as among the toughest and most rewarding. “The dimensions of this buoy outrange many conventional vessels: A weight of 1100 tonnes and a height of 27 metres mak-ing it the world’s largest in its category. The loading of such an object requires absolute precision and detailed prepara-tion,” states Stolberg. Due to the massive size of the cargo,

the firm was forced to restruc-ture the deck of the ship which was carrying it, as it restricted the sight from the bridge of the vessel. Stolberg describes the other changes which were nec-essary: “A specially designed grillage had been welded and was fixed to the weather deck of the vessel. One of the main tasks was guaranteeing the structural integrity of the vessel: The weight and size of the buoy and the grillage put tremendous loads on the ship’s structure, in some parts they exceeded 200 tonnes per square metre.”

Beluga is to launch a series of specifically designed multi-purpose heavy lift vessels late this year.

Beluga Shipping CEO Niels Stolberg says transporting a 1100 tonnes buoy across the ocean requires thorough planning and meticulous execution

“From late 2009 onwards, the new Beluga P class, a series of specifically designed multipur-pose heavy lift vessels, leaves the docks,” reveals Stolberg. “The Beluga P class provides for 16 powerhouses with combined 800 to 1400 tonnes crane capaci-ties, tonnage of up to 20 000 tonnes deadweight, moderate bunker consumption and ice class Finnish/Swedish 1A.”

“These vessels can operate in any port of the world and thus fulfil the market requirements for flexibility and a wide range of applications. They also under-line the company’s strategic focus on the stable and grow-ing super heavy lift market seg-ment,” says Stolberg.

1100-tonne cargos require steady hands.


This buoy was so tall it restricted vision from the special heavy lifter vessel’s bridge.


SPECIAL REPORT: PUMPS

Francesco Falco, pumps, valves and systems business leader for GE Oil & Gas is upbeat about both the potential, and performance of the Middle East upstream outlook, and delighted with recent contract wins. “The Middle East is one of the key growth regions for our products and serv-ices in general, including pumps. Recently we were contracted to supply a centrifugal pump system to Saudi Aramco, to help increase the ship-ping capacity of the Saudi Aramco refinery in Ras Tanura,” he says. The massive Ras Tanura expansion is designed to help Aramco increase its shipments to the central region of the Kingdom, which is facing a shortage of refined oil and gas products.

GE Oil & Gas provides pumps and valves specifically for oil and gas applications, providing its pump technology with flexible engineering capabilities across a wide variety of upstream and midstream applica-tions including oil pipelines, CO2 pumping for Enhanced Oil Recovery and subsea multiphase pumping.

“Our experience with projects around the world and strong synergies with key sub-vendors has enabled us to build a proven track record when it comes to supplying complete advanced pump technology solutions for some of the world’s largest oil and gas projects,” says Falco.

As enhanced oil recovery techniques increasingly come to the fore in the Middle East, Falco says that the company is well positioned to capi-talise on the need for intelligent pumping solutions. Excitingly, GE Oil & Gas is playing a critical role in the development of Brazil’s Tupi field,

GE OIL & GAS

PRESSURE POINTP

umps perform a mis-sion critical role for upstream operators. Despite a setback in

worldwide demand, Middle Eastern oil, gas and desali-nation projects have helped to prop up the global pumps market. According to a global market report by Freedonia, worldwide demand for fluid handling pumps is forecast to increase at a 4.4% annual rate to $47 billion in 2012.

In the Middle East, upstream demand has remained strong-

est in countries where National Oil Companies have pushed projects through in spite of pre-vailing economic conditions, namely Saudi Arabia, Qatar and the UAE with growth from Oman helping. From the Oil & Gas Middle East survey of lead-ing pump manufacturers, ven-dors and suppliers in the region there has been no question that the economic crunch has had an impact on local markets, notably with small to medium sized cli-ents ability to pay having been curtailed somewhat.

However, healthy economic conditions support the view that by 2010 the sector will have seen the bottom of the down-turn, and expectations remain high for a positive rebound from third quarter next year, through to sustained growth in 2011.

The twin pillars of the recov-ery for pumps sector will be rising energy consumption throughout the region, coupled with major infrastructure devel-opment projects geared to ena-ble each of the major produc-ers to increase their production

capacity. Both prerequisites seem to be in place for local producers to capitalise in the coming months.

The worldwide pump market is expected to be roughly $30 billion next year. Estimates range from roughly $22 billion (ITT), to $29 billion (McIlvaine), to $35 billion (Elsevier). Freedonia estimates the market will grow 4.8% annually through 2010 to reach $36 billion.

Pumps represent a mission critical investment for oil producers and field operators. Here, the region’s leading pump specialists provide an upstream perspective

providing CO2 re-injection pumps for oil recovery. “These pumps can operate at 540 bar pressure: the highest pressure ever reached globally by a liquid CO2 pump. GE is the only company able to combine the technical content and capability to make this CO2 re-injection pump because it can apply to pump technology the engineering required for compressors, which is a critical part of the solution.”

Falco says that reactor charge pumps, process pumps, oil pipeline pumps and high speed pumps have seen the strongest demand this year. Despite a relatively strong outlook, he concedes there are significant challenges for pump providers.

“We do a lot of business with both national and major oil companies including ENI, Saudi Aramco and Shell. We also work a lot with EPCs such as Technip, Chiyoda and Petrofac. Like everyone else involved in these projects, managing increasing pressure on costs as a result of the recession is my major challenge this year.”



Francesco Falco, GE Oil & Gas.


The GE Oil & Gas pumps for the Transnet project in South Africa will be centrifugal pumps designed for high effi ciency and a high degree of fl uid dynamic optimisation (pictured).


Calder Limited is a supplier of high and ultra high pressure pumps, which also manufactures high and ultra high pressure pump units and a wide range of water jetting accessories including nozzles, water blasting guns, and process pumps. The company has been steadily growing its global reach in recent years, and as well as Europe and Asia; its equipment is supplied directly or via representatives in UAE, Kuwait, Qatar, Oman, Syria, Yemen, Bahrain, and Iran.

Ian Calder Potts, managing director of Calder Limited, says that as a new entrant into the Middle East market the only way is up, but that enthusiasm is tempered with some economic realism. “In discussions with many of our poten-tial clients there is no doubt that the interna-tional downturn in the world markets is also impacting the GCC but probably to a lesser extent. The longer term future for high pres-sure pumps within the Middle East should be steady, but this is dependent on the oil price and continued investment in new projects.”

With the potentially lucrative business of the oil and gas industry in mind, Calder-Potts says the company is bringing its most cutting edge product portfolio to the Middle East. “As a pack-ager and supplier of very special high pressure and ultra high pressure pumps we are in the unique position of being able to offer a compre-hensive range of zero emissions reciprocating plunger pumps in full compliance of API 674 and capable of pressures up to 60 000 PSI with flowrates up to 160M³ an hour. Our range of Hammelmann ‘Zero Emissions’ pumps has the added advantage of the labyrinth sealing system

which is unique to our range of high pressure pumps providing significantly extended life resulting in reduced operating costs and a much safer working environment.”

That oil and gas pedigree is standing the company’s business in good stead in the Middle East. “Our range of well service pumps have been the least affected in the current market downturn. Well maintenance must continue as long as oil and gas is required to meet demand, which inevitably results in a strong demand for large 500 kW to 2000 kW diesel engine driven and electric motor driven pumps capable of delivering high flow rates at pressures up to 20 000 PSI.”

Certain key trends are emerging in the regional upstream pumps arena, says Calder-Potts. The decision-makers in the Middle East are increas-ingly aware of the importance of high quality high pressure pumps which can deliver low life cycle costs on a 25 to 30 your life where as in years gone by purchase decision was all too often made on the net buy price without much consideration for quality and longevity.

Echoing the sentiments of other leading pumps providers, Calder-Potts sees the flight from quality as a major challenge in the coming months. “Persuading end users that ‘cheap-to-buy does not necessarily mean, cheap-to-own’ is a top priority for us right now. The idea that one should always purchase the least expensive product on the market can often prove a disas-trous policy and no less so when it comes to high pressure pumps which are particularly sensitive to cost.”

CALDER

Calder High Pressure (10,000 psi) Methanol injection Pump Skids.

56 Oil&Gas Middle East October 2009

Sriram Iyer, regional manager, LEWA pumps and systems says that the emerging trends in the upstream field this year have been a more focused approach in relation to life-time cost of project. “End users are thinking both in terms of reduction in capital outlay and also lifecycle costs. This means that the customer would like all his equipments to do much more than in the past in terms of efficiency, productivity, ease of operation and of course, safety.

The strongest business line for Lewa this year has been in relation to upstream and midstream gas handling solutions. “Demand for gas has been growing very much in this region, and delivering the pumps and systems required for gas processing is still showing healthy growth.”

Whilst the year has been challenging, Iyer notes that the pumps market is still developing in the Middle East. “Sales are buoyant, and it’s only the growth rate that has taken a dip. While we have had some extraordinary growth in the past, the dip we see developing now keeps expecta-tion under control. The average trend is still towards growth and this will be visible clearly as global demand for energy recovers.”

The Middle Eastern countries dominating Lewa’s revenue stream have unsurprisingly been the most willing to press ahead with capacity building projects. “Currently Saudi Arabia and UAE have some very exciting expansion plans and these countries show the biggest investment in oil and gas related projects.” Iyer adds that is spite of the downturn 2009 will deliver the highest sales for Lewa in region to date.

LEWA



With the introduction of its newest range of pumps, Pulsafeeder says it has re-invented the hydraulically balanced diaphragm pump design. The new range called Pulsa Pro 900 pumps is specifically developed to handle demanding applications in oil and gas and petrochemi-cals industries.

“Pulsa Pro 900 pumps incorporate ease and simplicity of start up and maintenance, modularity of design, the best dosing accuracy and the longest warranty in the industry. This new range of pumps is available in Simplex, Duplex and Quadruplex configura-tions with Triplex configuration to follow by the end of the year,” explains Ashok Rekhi, director, international sales, Pulsafeeder Inc. In Simplex design, in phase one, the pump is capable of pumping 15,570 Liters/Hour and is rated for a pressure of 300 Bars. The phase two will increase the capacity and raise the rated pressure to 1,000 Bars. The four-bolt tie bar design on the PulsaPro 900 pumps resists pipe stresses, holds the check valves rigidly in position and promotes leak free operation.

TECH TALK: PULSAFEEDER

The Pulsa Pro 900 from Pulsafeeder.


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Abu Dhabi-headquartered Al Mazroui Engi-neering Co began life in Abu Dhabi in 1986, providing services to ADMA-OPCO. That rela-tionship continues to this day and has grown to include Takreer, Borouge and GASCO amongst others. EPC contractors and consult-ants such as Petrofac, Technip and NPCC have become important partners too, according to Drew Steedman, business development manager at Al Mazroui.

“We also represent some of our principals in other GCC countries, we are proud to include the likes of QVC, QAPCO, Dolphin Energy and SABIC amongst our customers.

Steedman says the wealth of hydrocarbon resources concentrated in the Middle East, and the associated industries it supports, has helped keep local suppliers busy this year.

“Due to the natural resources in the Middle East, many projects in the oil, gas and petro-chemical industries are still going ahead, and therefore there is still buoyancy in the pump market that is just not available in other regions of the world,” he adds.

However, not every market has been as determined to push ahead with its projects. “Kuwait, for example, has seen the majority of its projects cancelled or postponed. Saudi Arabia, Qatar and the UAE are largely pushing ahead, particularly with expansions to existing facilities,” says Steedman.

Al Mazroui represents several major pump manufacturersand provides a full range of services, including: Design engineering, fabri-cation, modification and upgrading, as well as installation and commissioning services.

As the projects going ahead in the region are predominantly expansions to existing oilfield and downstream facilities, demand for pumps meeting API 610 specifications seem to dominate Al Mazroui Engineering’s business streams.

“Behind this we see LPG pumps, vacuum pumps and compressors, as more vapour recovery systems are introduced as an alterna-tive to venting or flaring, thereby preserving natural resources and reducing greenhouse gas emissions.

Steedman says that in tight times the temp-tation for oil companies to cut costs is under-standable, but if this translates to cutting quality also, the gains may prove to be a false economy. “Our main challenge in the current economic climate, is to convince clients without the financial resources of the oil companies that cheap alternatives may very well be much more expensive in the long run. At a time when companies need to be at their most profitable and productive, downtime as a result of trying to save a few Euro’s or Dollars at the purchasing stage could be catastrophic. We believe that buying the right product with full service support is a far more economical proposition for any customer.”

AL MAZROUI

Bogdan Fatu, business develop-ment manager – Triplex Pumps, for Hydrolink, says delivering high and ultra high pressure pumps for tank cleaning, heat exchanger cleaning, surface preparation and pipe cleaning operations has been the mainstay of the company’s oil and gas related business this year. “The pumps market is growing and the demand on special equipment, especially for the upstream compa-nies remains high. We are busy deliv-ering custom build equipments for the local conditions as high ambient temperature and high humidity.”

Fatu says that whilst growth has slowed, 2009 and 2010 will still be years of expansion for Hydrolink. “We are working across the most dynamic markets in the region, but Saudi Arabia and the UAE represent our biggest markets, but we are also seeing strong growth from Qatar.”

HYDROLINK

Hydrolink’s primary fabrication site is based in Dubai, UAE.

$36 BNWorldwide pumps market is expected to grow annually by 4.4% to $36bn in 2010Source: Freedonia

A ction International Services is a pump services company based in Dubai, spe-

cialised in providing engi-neered pumping solutions to customers, with a business unit dedicated to the oil and gas industry. Padraig Nagle, managing director, talks to Oil & Gas Middle East.

What’s different about Ac-tion International Service’s offering from a typical hire company?PN: With our technical expertise and the largest and most diversi-fied fleet of specialised equipment in the region, we have the ability to provide superior cost effective solutions that meet customers’ budgets and timelines. We have a dedicated division focused on providing the upstream oil and gas and industrial sectors with tempo-rary pumping solutions.

How would an operator benefit from choosing a service partner as opposed to buying in trusted brand pumps?PN: We differ from many players in the pumps market because we offer pump services as opposed to being a pure hardware provider. We assemble the pump pack-

Trouble shootingBespoke pumping solutions can save oil-field service companies and producers money and time says Padraig Nagle of Action International Services

ages to order, and the specifica-tions for that come direct from the customers. We hold the distribu-torship for a number of different major pump manufacturers, such as Godwin and Hughes pumps from the UK, but when customers come to us, we deliver Action’s services complemented with the reliability of well maintained industry leading equipment. Action stands for innovative engineering solutions, operational excellence and product reliability, and we are strongly complemented by our principal partner’s products.

What has demand been like in 2009?PN: Each sector is quite different. The oil and gas business is quite robust for us. I expect that this year’s business will be at least the same, probably a bit higher than in 2008. That’s a combination of our growth, product diversifica-tion and capturing market share from our competi-tors. Action has recently expanded its industrial services capabilities to include shutdown equipment and asso-ciated services.

www.arabianoilandgas.com60 Oil&Gas Middle East November 2009

Padraig Nagle, managing director of Action

International Services.




rapid solutions in the event a pump fails. We can be there and have operations running again in a very tight turnaround. It’s very rare that we don’t have a solution in house. We have our own fabrication crew which means we can turn a bespoke solution round in just a couple of days. Because the solu-tions are tailored, fuel consump-tion is optimised, bringing associ-ated cost-benefits over the course of the project.

What support offering comes with the equipment?PN: We very much prefer to send a team along with the products. We highly recommend it, but it all boils down to how much risk the client wants to take on. What we are

very good at is listening to our clients and gath-

ering all the data we can from

our clients in order to resolve an issue or provide a solution. We have a level of compe-tence inter-

nally which is on a par with many specialist consultants. We have geologists, hydrologists, pipeline engineers, hydraulics experts, so we can do the A to Z of design internally. Additionally we have a very strong construction knowl-edge base which we can marry with our technical ability to deliver the solutions our clients need.

Have you seen regional variation in business this year?PN: The oil and gas business is quite different in each terri-tory. For example the Abu Dhabi market is very different to the general Arabian Gulf market, and even from the Dubai and Fujairah markets. We have quite a high and growing proportion of our busi-ness outside the UAE and the Gulf, and have recently sent equipment to Iraq, Pakistan and Azerbaijan.

How are you tackling the Saudi Arabian market?PN: Saudi Arabia isn’t a country we have exploited fully yet, but that said, it’s very much in our sights. Every market has slightly different dynamics in the region, so how we penetrate the Saudi Arabian market may involve acquisition or partnership, and we’re looking at the best vehicle for us now.

“We can deliver bespoke, rapid solutions in the event a pump fails. We can have operations running again in a very tight turnaround.” Padraig Nagle, Action International Services

What’s a typical upstream call-out for you?PN: Typically in the oil and gas business it would be a contractor who is experiencing problems. Usually it is water supply issues. In many cases small to medium sized service providers, which don’t maintain many assets, but may be specialists in their field, contact Action in order to expand their scope and capabilities. What we have developed is a reputation for delivering bespoke,

Nagle says the Saudi Arabian market is a top priority for future growth.

AL MAZROUI ENGINEERING.CO .LLCAL MAZROUI ENGINEERING.CO .LLC

Since its inception back in 1986, the trademark of Al Mazroui Engineering is its approach to problem

solving. The company's strategic approach yields solutions that integrate client n ee ds with long term

sustain ability.

Services

Design engineering.Fabrication.Modification and upgrading.Supply.Installation and commissioning.Preventive maintenance.Post sales service for pumping stations.Consultancy, design and supply for corrosion protection requirements. Environmental services.Specialised recruitment services (engineers, skilled technicians etc).

AL MAZROUI GROUP

VOITH NETZSCH


EVENT PREVIEW

DOHA DELIVERS

N ext month will see Doha play host to the The International Pe-troleum Technology

Conference (IPTC), with an expected draw of over 3000 up-stream professionals.

The conference is tipped to be the industry event of the year, with a stellar list of digni-taries and energy leaders flying in from all over the world.

The conference programme will address technology and rel-evant industry issues that chal-lenge industry specialists and management around the world, with a strong focus on the gas business, as well as topical issues such as HSE, Security, HR and training.

“The response has been unprecedented and we applaud our industry colleagues for making such a valuable contri-bution to the development of the oil and gas sector,” says Khalid Al-Hitmi, manager gas develop-ment at Qatar Petroleum and co-chairman for the IPTC con-ference programme.

“The conference is an impor-tant date in the calendar, coming to the Middle East only every two years. All 52 technical top-ics we initially proposed for the event will be addressed and due to the calibre of the papers, we have added a further six techni-cal discussions so that delegates truly get the most out of the con-ference,” adds Al-Hitmi.

IPTC 2009 will play host to a stellar line-up of upstream energy leaders.

Oil & Gas Middle East previews the upcoming event of the year, December’s IPTC conference and exhibition in Doha

THINK TANKConference organisers, the SPE, have said the industry has responded in record numbers to the call for papers for this year’s IPTC. With 1128 papers submit-ted, the highest amount ever to be received in the history of the IPTC, the programme commit-tee selected 600 papers for pres-entation, representing 130 com-panies from 35 countries.

The select committee, which includes some of the world’s foremost leaders in the oil and gas sector, set high selection criteria for the papers, as part of their efforts to make the confer-ence a must-attend event for eve-ryone working in the upstream oil and gas business.

Olivier Dubrule, director of Total Research Centre – Qatar, also co-chair for the conference, says the topics up for discussion will have real value for attend-ees. “The programme will focus on the dissemination of new and current technology, best practices and multi-disciplinary activities, designed to empha-sise the importance of the value chain and the maximisation of asset value,” says Dubrule.

BIG HITTERSThe conference has become a platform of choice for glo-bal energy leaders to address their international counterparts, and this year’s event will be no exception. Andrew Gould, chair-


EVENT PREVIEW

The Society of Petroleum

Engineers is the lead

organisation in the

management and

financial control of

the event.

IPTC is being held under the patronage of Sheikh Hamad bin Khalifa al-Thani.

develop the current and future energy resources, particularly the more difficult and uncon-ventional resources. The morn-ing session will also shine a spotlight on the issue of recruit-ment and retention of peo-ple with the skill sets to over-come those challenges.

since the inaugural event in 2005. This year the conference presentations and networking events will take place on the exhibition show floor, maximis-ing interaction among industry colleagues,” explains Waleed Refaay, the project director for IPTC 2009.

DON’T MISSThis year’s opening plenary session, taking place on Mon-day 7th December at 11.15am, will address world energy chal-lenges, with a focus on endur-ance and commitment. The energy industry is poised to enter a new phase of its growth, facing huge challenges due to the significant drop in demand for oil and gas and energy prod-ucts across the world. This has led to a dramatic reduc-tion in the hydrocar-bon prices, which led to the recon-sideration of the investment conditions and resulting in postponing a few of the most costly projects.

On the other hand, it is clear that long-term energy demand will continue to surge, thanks to a growing global population of over 6 billion and the rising standards of living, especially in places like China and India.

The session, to be chaired by Nasser Al-Jaidah, chief execu-tive officer of Qatar Petroleum International and Yves-Louis Darricarrère, president, Exploration and Produc-tion at French Superma-jor Total, will address how the industry will con-tinue to meet the growing demand for energy and how supplies will be sus-tainable in the future. The session will also examine how companies should maintain stable investment conditions

to secure fund-ing to

man and CEO of Schlumberger, will be joined by Olivier Appert, chairman and CEO of Insti-tute Français du Pêtrole, Rich Kruger, president of Exxon-Mobil Production Company and Saad Al-Kaabi, director of Oil and Gas Ventures for Qatar Petroleum.

The theme of the fourth edi-tion of the IPTC, held under the patronage of His Highness Sheikh Hamad Bin Khalifa Al Thani, Emir of the State of Qatar, is ‘World Energy Chal-lenges: Endurance and Commit-ment’. The event, which returns to the Middle East from Kuala Lumpur in 2008 has become established as a biennial event and has been endorsed by OPEC as well as the Organisation of Arab Petroleum Exporting Countries (OAPEC). Industry heavyweights ADNOC, Saudi Aramco, and Qatar Petroleum are taking a leading role in this year’s event. Whilst the impres-sive portfolio of conference ses-sions will no doubt prove the biggest draw, this year’s IPTC is augmented by a strong exhi-bition element. “IPTC’s exhi-bition space has grown by 40%

The IPTC is a collaborative effort among:• American Association of Petroleum Geologists (AAPG)• European Association of Geoscientists and Engineers (EAGE)• Gas Processing Association (GPA)• Society of Exploration Geophysicists (SEG)• Society of Petroleum Engineers (SPE)

ALL UNDER ONE ROOF

$178 BILLIONThe GCC gas sector alone has 155 projects worth US$178 billion in pre-construction or execution phase.Source: Proleads

SPE AT THE HELM

Olivier Dubrule, director of the Total Research

Centre in Qatar.


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ASK THE EXPERT


What does the API 682 standard involve? The American Petroleum Institute issues standards for all aspects of oil and gas production and has a number of standards relating to equipment, of which API 682 is the standard for our product range, which is mechanical seals. It is an important standard because it allows purchasers to get a degree of confidence that a product is of a certain quality and the standard provides certain criteria for performance standardisation. And the standard is primarily aimed at improving reliability of plants and reduction in fugitive emissions.

What new ground does it cover?The standard is currently on its third edition, while the fourth edition is being worked on.

It is offering improvements primarily in the comprehension of the standard, which is quite compli-cated to follow. The work that is being done by the taskforce on the new standard is added comprehen-sion, which should make it easier to read. There are no substantial changes, only ones intended to make the standard a little more comprehensible.

What makes these types of standard important?I think the major importance of it, is that if you apply these standards when you are specifying equip-ment, you know that you are guar-anteed to get equipment that is safe and reliable, particularly when the equipment is going to be used for hazardous and possibly toxic type services.

What’s topical in the pumps and seals business?I think pump vendors and users need to look at the total cost of ownership, obviously there is the initial costs involved in purchasing seals, but over the lifetime of the plant, selection of the seals can impact on maintenance costs considerably and energy costs can be impacted as well. Considera-tion should be given for these long term costs at the design stage.

The seals project market is suppressed to what it was a few

years ago for equipment. However I believe that is a short term situa-tion and when the global economy picks up, the demand for new plant equipment will probably outstrip supply. So I am very optimistic that it is going to be extremely busy in a few years time. I think the Middle East has been largely unaffected. The global slowdown has affected the developed nations such as the

US, Western Europe and the Far East. The Middle East has prob-ably benefited from investing at this time because the costs are lower. AESSEAL as a business is still showing strong growth throughout this period.

What challenges are you facing?Our business is not typical to other businesses. Finding good people is always a challenge and fortunately we have been able to assemble a very good team. I think one of my

challenges is trying to get people to understand the total costs of owner-ships and for that you need to look a little bit further than just pure equipment costs. You also need to consider the periphery equipment associated with seals and pumps, and their lifetime costs.

What developments should readers be aware of?There are a number of break-throughs currently taking place in the seals market. One of the things that has happened in recent times is that machine tool technology has moved forwards, allowing us to offer more elegant designs that provide better performance and improve reliability. That is a manufacturing breakthrough that has opened up the scope of designs. We have also had break-throughs in technology associated with cooling seals, which offer improved methods.

What are your hopes for the next six months?My hope for the business is that the brand grows and gets recogni-tion throughout the globe and in particular the Middle East market, I’m hoping that we will have more market awareness of our brand.

Question: What developments in API standards for pumps and seals should I be aware of?

Expert: Richard Smith, director, oil and gas development, AESSEAL, met Oil & Gas Middle East in Abu Dhabi.

“Pump vendors and users need to look at the total cost of ownership, throughout the lifetime of the plant”

Ask the

ExpertIf you have a question you want answered, or a topic discussed, please send it to [email protected]

Richard Smith, AESSEAL.


MIDDLE EAST WORKBOATS

Middle East Workboats was held in Abu Dhabi.

SHOWBOATINGMIDDLE EAST WORKBOATS

Middle East Work-boats was opened to the sound of bagpipes, but was the event in tune with industry re-quirements, or just hot air? Oil and Gas Middle East reports from the exhibition

M iddle East Work-boats 2009 was held in Abu Dhabi last month, and the

topics of interest varied wide-ly. The economic situation was considered throughout, while more industry specific topics such as piracy were delved into on a much deeper level.

The exhibition was opened with a marching band boast-ing a number of bagpipers, and as the music died down, the buzz of the exhibition was ramped up. A number of exhib-itors commented on the ‘right people’ being present, and there was certainly a commu-nity atmosphere at the show as partners, clients and competi-

tors put their companies and their services on display.

The future for workboat companies appears to be mixed. Geir Sjurseth, managing direc-tor and global head of offshore for DVB Bank said at the event: “The majority of Middle East companies will see a satisfac-tory 2009 but 2010 is far more uncertain. The well established players that survive will have a fantastic future.

“The strong companies, and there are many in the Middle East, will preserve capital, cut costs and the smartest guys are planning how to benefit in the longer term. When the dust finally settles, the outlook is favourable but before that we

will likely see defaults and con-solidation among highly lever-aged, recent entrants into the workboats market.”

A seminar and conference programme ran alongside the exhibition. The seminar ses-sions gave companies the chance to showcase their spe-cific abilities, as well as giving technical advice to the industry, while the conference covered more widespread issues.

Kicking off the conference was Darwish Al Qubaisi, gen-eral manager, ESNAAD, who covered the approach to quality in vessels.

“I want to say that trying to save a little bit of capital will cost you a lot in the long run,



What services does Irshad offer?We are primarily service providers to the mari-time industry. Firstly, our role consists of being on-board pilots. So when a ship is coming in from London, from Lisbon or Sydney, or wher-ever it may be, we are waiting for it. In the ship-ping industry, you need to work ahead of time

so the ship has to be ready on arrival and the terminal has to be ready because time

is money. So we make plans before the ships arrive and when she arrives we

are ready for her. Our mantra is that we wait for the ship; she doesn’t

wait for us. The closer the ship is to the shore, the higher the risk,

so our pilot work is crucial. We meet the ship 20 miles out, before boarding her to bring

her in. Once she gets close to the dock, tugs complete the journey. At that stage, we swap hats to become loading masters. This is our mission; to wait for a ship, to bring her in and to unload her.

Why did you choose to exhibit at Workboats?As far as marketing is concerned, right now we already have ten ships loading so we don’t need marketing. So in actual fact, I don’t need to talk about what I do; I believe the service we offer does the talking for us. However, we do need to have the latest technology, so we are here to see different engines amd also simulators for training. Luckily, there are a lot of engine makers here, so we’re happy to discuss our needs with them.

What challenges are you facing?In summer here, sea temperatures are 37 degrees, and that water is designed for cooling. However, water that warm won’t cool your engine. So we are here to talk to companies and see how their technology can fit into our environ-ment. Some firms here are offering simulators; if I have a difficult situation, I will not take a chance, so I will use the simulator. And with the wealth of tugs available, which should I use in my opera-tion? You have to look at your needs, starting with the environment, and build out from there.

IRSHADCaptain Cheikh Atbi, marine recovery and training specialist, Irshad

in terms of maintenance. To end up with a good finished prod-uct you must start with a clear operation requirement,” Al Qubaisi revealed.

Another topic covered in this conference opening, was the issues attracting new personnel to the sector, which was a heav-ily discussed subject through-out the exhibition.

Al Qubaisi described one of his firm’s solutions. “We have started working with the UAE navy and we are trying to rehire ex-navy people. Of course you have to get them ready through training and I’m very happy to say we have had some good suc-cess back from the Navy.”

A presentation was also held showcasing the capabilities of

the International Marine Con-tracting Association (IMCA). Roy Donaldson, chairman, Middle East and India Section, IMCA, revealed: “We promote self regulation within the indus-try. We are given an indication of good practice from our mem-bers, we supply advice to our members and we issue guide-lines through clients.”

With a good turnout, inter-esting conference debate, not to mention an original and inter-esting way to open the show, it is fair to say Workboats Middle East was more than useful for all involved.

Among the products on show was a simulation training programme.


For full coverage of Mid-dle East Workboats, visit www.arabianoilandgas.com.

Captain Cheikh Atbi of Irshad.



The W Tug 80, designed for 80 ton

bollard pull, can attain a speed of

14.5 knots.

What brings you to Abu Dhabi?BK: We have a special focus at Workboats on the W-Tug, a new Wärtsilä tug design. This is a high performance escort tug of 35m, capable of carrying out ship assist duties at offshore termi-nals, as well as high-speed escorting, push-pull operations, and coastal towing.

What’s special about the W-Tug?AB: Due to its compact size and two Wärtsilä steerable thrusters, the tug is highly manoeu-vrable. The rounded bow profile with moderate flare is optimised for pushing and reduces the risk of slamming. The towage and escorting duties are served well with a forward 112t towing/anchor winch. A 91t towing winch is sited aft of the superstructure. The tug can be equipped for fire-fighting duties, and can operate 200 nautical miles from the coastline. Also, because everything on board in finely tuned to this particular hull, we envisage fuel savings of around 7%.

What are your hopes for Workboats 2009?BK: We hope to get a lot of feedback on what customers in the Middle East think of the vessel. It’s still in design stage so it will be useful to

WÄRTSILÄ SHIP POWER

INTERVIEW: Bram Kruyt, director, Ship Power, Special Vessels Arthur Boogard, business manager, Ship Power, Special Vessels

hear what people like, and maybe what they don’t like about the vessel.

Diesel and electric hybrid engines are also exciting. The response so far from customers has been enthusiastic, obviously from a green environmental approach. The whole industry is getting greener and whilst the emissions legis-lation is not yet in force in the Middle East as it is in some European waters, we think from a corporate social responsibility and environ-mental angle there will be appetite here.

Are oil and gas vessels keeping lo-cal demand strong?AB: The Middle East is relatively favourable to other marine environments right now. The latest results from our global studies show that this region is more dynamic than the rest of the world, also the market for tug boats is more resilient than merchant shipping, which is having a tough time right now.

When do you think the market will be back up to strength?BK: The second half of next year is probably a cautious timeframe to say orders

will start increasing again. Owners are being more cautious with placing orders. For tug and workboats we expect recovery by third quarter next year, however, merchant shipping may take another one to two years to fully bounce back.

Are owners having difficulty financ-ing right now?BK: For the right vessel and the right owners there is still finance out there. To help our cus-tomers we have developed a model so we can become a partner in newbuild vessels, which eases the pressure on owners to find finance

from distressed banks.

Bram Kruyt, and Arthur Boogard (left to right).



What challenges are you facing?Everybody is sceptical about the future, and everyone is studying what everybody else is

planning for. What we see in this part of the world, and in the workboats and supply busi-ness, is there is still a demand. There are still rigs under construction, there is still oil explora-tion and production, and there is still a need for workboats to carry out offshore work. Today, I believe that this market is stable, perhaps with a little bit of growth.

What are you doing to help customers?We have tried to increase the confidence of our customers with respect to cost cutting. There are a lot of laid-off ships from owners and we are offering laid-off services as a result. We are also trying to increase training to customers and increase awareness of how they can work in these circumstances with more quality, safety and efficiency.

What are your hopes for the next six months?I hope the market is going in the right direction; I

hope that the confidence flows back to the shipping market in partic-

ular; and I hope to see growth.

DNVOmar Abu Omar,

district manager, DNVWhat services does Noble Denton

offer?We are a technical assurance and consultancy company. The merger of GL and Noble Denton in April this year brought together two very strong companies in the marine industry. GL is best known for its clasifications and also for indus-trial services, while Noble Denton is famous for its marine operations.

How much of your business is in the UAE?A lot of our business is based in the UAE and the surrounding GCC countries. We currently have a combined staff of around 300 people. We wanted to be here because it’s very important to meet our local clients and show what we do; one of our problems is that we do so many different types of work that clients aren’t aware of the full range of our business.

What are your hopes for the show?More business! We’ve got strong technical values but equally both companies are commer-cially minded. It is a competitive market and the only way you can win is through delivery of a good product to your clients. We also want to let people know about our office opening in

Sharjah. This is a unit that we designed

the detailed engi-neering for; the office there has

approximately70 people.

NOBLE DENTONCaptain Ian Bacon, general manager, Noble Denton

What services does Svitzer offer?In a nutshell, Svitzer delivers marine services globally and that ranges from the towage business in salvage to ocean towage. We also have rescue and safety services, which is training and products. So I would say we are quite a diversified company in this particular industry and we can offer safety and support in a number of significant and different ways.

Why did you choose to sponsor Workboats?What we like about this exhibition is that it covers a high niche, it is focused and it attracts the right people. Our potential custom-ers, our customers and suppliers, in fact everybody we deal with or compete with are here. It is also a great place to be seen.

What are your hopes for the show?We hope to talk to existing clients and potential new ones. This forum presents a good opportunity to allow people to work together. Our goal here is to network; we don’t expect any major deals to be signed here. For that we normally need a little more time but our market is here, along with a nice crossover to the Asian sector.

SVITZERJaap-Jan Pietersen, commercial manager, Svitzer.



Captain Ian Bacon, GM, Noble Denton.

Jaap-Jan Pietersen, Svitzer.

Omar Abu Omar, district manager, DNV.



need to educate some of the ship owners and the operators of the equipment, which does tend to be forgotten. They tend to buy the equipment but then very little training is done after that. Especially when you are using the water to keep a structure cool when the fire is in place, it needs training to get the most out of the equipment.

What services does CounterFire offer?We do fire monitors and we do a whole system design. If someone comes up to us and says we want a certain system then we will select the correct gearboxes, the pumps, the valves, do the water deluge system for the boat, commission the system and if asked we can also give training to the ship crews. Normally the shipyards are in such a panic to get things commissioned and the boat delivered, that part of it very rarely happens. Our products are made in the US.

How much of your busi-ness is in the Middle East?As a percentage for the whole company its probably only 5-7.5%

but we are seeing an increase in activity at the moment, certainly in regards to enquiries so hopefully that situation will change . That is one of the reasons for our pres-ence here at Workboats as well – to remind everyone we are here.

How can fire and safety improve in the Middle East re-gion?You would need to evaluate what equipment they have got over here at the moment to be honest with you. We have supplied quite a few systems to vessels but these tend to be the first line of the systems and you probably need more of the bigger systems which are more substantial and have higher volumes of water. I think there is a

COUNTERFIRERegion must buck up training ideas, says Richard Lucas

Richard Lucas, CounterFire.



What services does Albwardy offer?As a marine engineering company, we have been around for 30 years. We build ships, we repair ships, we dry-dock vessels and we work offshore as well. Our bases are located in Dubai, Fujairah and Oman and we employ around 900 people. Albwardy is 49% owned by Damman Shipyards group in Holland, a company for which we build ships. We build tugs, work-boats and dredgers for Damman but we also repair vessels of any size from VLCC tankers to small boats.

How much of your busi-ness is in the Middle East?The majority of our business is in the Middle East but our customers are not all from this region. We deal with a lot of ship owners from the United Kingdom, from Singapore and also from mainland Europe. Because Fujairah is such a busy bunker port, a lot of our repair work is done at the anchorage in that location. But we also send people around the world, sailing them to various companies to carry out voyage repairs.

Why did you choose Workboats to exhibit at?We came last year and we didn’t exhibit, but it was a great event. So this year we decided to link up with Damman on a joint stand. I hope to generate new business here too. It’s a good opportunity to showcase our abilities not just with newbuilds but also with regard to the repair work that we carry out.

What are the toughest challenges in today’s market?We have had to diversify. Last year we were very busy as everyone was but more with repairs. This year, we have had to change our balance a little bit. Our bottom line hasn’t changed - we are still talking about the same numbers, but the balance of repairs has changed. Now we are doing more newbuild work and more float repairs; we are still doing dry-docking but not as much as before. One of the main areas of our business was dry-docking dredgers but right now there’s a lot less dredging going on. But there is an awful lot of float repairs at the anchorage because there are more ships out there right now.

ALBWARDY MARINE ENGINEERINGMark Pearson, deputy general manager, Albwardy Marine Engineering

In terms of bottom line we are doing as well as last year but we have re-addressed our balance. As a company we are fortunate because we are not in one specific area. Because our company is spread over three different markets you can gener-ally weather problems, so if one market is affected, the other two can usually keep you going.

What are your projections for the next six months?In the next six months, we will be looking to relocate. We are currently based in Al Jadaf, and we’re looking at the new developments at Dubai Maritime City, as well as a number of other options. So that is one of our focus points. The other main issue is keeping the busi-ness up; we are very fortunate that we haven’t been affected too much, but you can never take your eye off the ball.

Mark Pearson, Albwardy Marine Engineering.

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SEISMIC VESSELS

Oil & Gas Middle East meets Polarcus CEO Rolf Ronningen to find out what makes the UAE-built Nadia a real offshore game changer

SEISMIC SHIFT

Polarcus is currently building four ultra-mod-ern new build seismic vessels, in Drydocks

World’s flagship yard in Dubai. Three of these new builds are high end 12 streamer 3D ves-sels, and the remaining one is a multipurpose vessel for ei-ther 6 streamer 3D operations or source operations for wide azimuth projects.

Guiding the good ship Polar-cus is CEO Rolf Ronningen,

bringing 28 years of seismic experience to the helm.

From his office at the top of Dubai’s skyline, the waters into which the first vessel, Nadia, will be launched this month, are just visible. Polarcus, a brand new start-up has obviously joined the industry in a tough year, but Ronningen’s enthusi-asm hasn’t been dampened by events outside the company’s office. “Today we are a four ves-sel company. We started with six

vessels, but because of the finan-cial crisis we did not see that we would be able to fully fund all six vessels. We were faced with a choice and we decided to sell the vessels to the founding shareholders, essentially trans-ferring the risk whilst holding a purchase option to buy the ves-sels back.”

Ronningen hopes the com-pany will be in a position to re-acquire the remaining two ves-sels in 2010.

The first two vessels are due to be delivered in November and December this year, and the company has already secured a contract for the launch vessel Nadia. “We have signed a Let-ter of Intent with TGS-NOPEC Geophysical Company ASA (TGS) for the charter of the 12 streamer 3D seismic vessel Polarcus Nadia for around three months commencing in Decem-ber 2009. The Letter of Intent further includes a right of first

SEISMIC VESSELS

Leaders in Fluid Engineering

SEISMIC VESSELS


CUTTING EDGE

The X-Bow is an exciting devel-opment. In bad weather, rather than smashing into waves, which retards the flow of the vessel, these bows will slice through the water, reducing pitch. As well as a more comfortable ride, it actually uses half the fuel at the same speed as a conventional vessel, or twice as fast for the same fuel consumption.

refusal for TGS to extend the charter in two six month incre-ments under pre-agreed terms”

The Polarcus Nadia is the company’s first newbuild and incorporates leading design features that will position her as one of the most advanced seismic vessels in the industry. With the first contract under its belt, business for Polarcus could really take off next year. “We have 17 bids outstanding with the oil industry, and we

SEISMIC VESSELS



SEISMIC VESSELS

have been told we are the front-runner in some of those tender bids,” beams Ronningen. The company is targeting key stra-tegic areas of business, initially East Africa – stretching from Madagascar to Somalia and the Mediterranean, and is hoping to tap into the hotspots of activity from Oceania and the Arctic.”

Polarcus will own and oper-ate the vessels itself - a strong offering to oil and gas compa-nies. “The fewer management systems you have on board the better as far as exploration is concerned,” says the CEO.

When the oil price is below a certain level, exploration tends to drop off, and drop off fast. However, high-level seismic is

the most resilient marine mar-ket to this volatility. In the late 90s when the crisis hit, most high-end towed seismic opera-tors remained cash-positive. That said, it’s not as though the market has escaped the lull completely.

“Compared to where it was a year ago, there has been a very significant reduction in vessel prices. But I am confi-dent we have seen the bottom of the cycle. There were very few

cables, with the depth and infra-structure ‘clutter’ making accu-rate readings more challenging for towed seismic operations. However, Ronningen says the

lack of competi-tion in the

region is

leads coming up back in March, but now there is a heck of a lot of activity. From the second half of next year I am very, very con-fident that utilisation and rates will have bounced back.”

Given the shallow waters lapping at Arabian Gulf’s edge, most seismic activity in the Middle East tends to be carried out by bottom laid

“I am confi dent we have seen the bottom of the downturn. There was very little business going on back in March, but now there is a lot of activity” Rolf Ronningen, chief executive offi cer, Polarcus.

Rolf Ronningen.


SEISMIC VESSELS


SHIP AHOY!The Polarcus vessel Nadia splashes into service in November, launching from the local fabrication yard, Drydocks World - Dubai.

Ulstein, ship designer of the X-Bow vessel type also has a stake in the Polarcus project, says Gunnar Haug, regional director of Ulstein Middle East.“We occasion-ally enter into projects as stake-holders, partly to show interest in the project, but also to make it easier for a customer to realise his project. We inject some capital and then sell out after a couple of years. Essentially this acts as a facilitator,” says Haug.

“There are many ways to help the client with financing, and I think this sort of stakeholder and financing collaboration is likely to increase in the future.”

Ulstein is also building seismic vessels for Western Geco, a subsidiary of oilfield service giant Schlumberger. The first two seismic vessels with the Ulstein X-Bow, WG Columbus and WG Magellan, have been working together in the Gulf of Mexico throughout the summer. WG Columbus, hull number 1657, was deliv-ered in March, while WG Magellan, hull number 1658, was delivered at the end of July. Both vessels were built at Barrerasin Vigo, Spain.

Western Geco currently have four ULSTEIN SX124 vessels under production, two at Barreras and two at Drydocks World in Dubai. The Dubai vessels are planned for deliveries in 2009 and 2010.

Aside from the seismic vessels, Ulstein is a designer of offshore construction vessels, field support and well intervention vessels.

“The Arabian Gulf waters often demand vessels with a draught of less than six metres, so we are working to adapt our workboat and support vessel designs to fit the needs of the local market,” reveals Haug.

BOW WOW FACTOR: ULSTEIN GROUPa real advantage. “There are no seismic companies based here, yet when you look at the con-centration of resources here, we see a big opportunity. It also has additional benefits. It’s very easy to attract people to come to Dubai. I have experience in Nor-way, Singapore and the US, but this is by far the easiest place to attract people.”

The Polarcus asset Ronnin-gen is most enthusiastic about is the company’s ultra-green ethos. “Our unique offering is the Explore Green technology. This is not just repackaging something and calling it envi-ronmentally friendly. It is real

and we are taking way beyond

CSR.

We are massively reducing par-ticle exhaust emissions. All of the vessels are double hulled which is an extra expense, but one that in the event of a ground-ing, could prevent any pollutants escaping.”

Ronningen reveals that the extra build-costs are paying off already. The company has had pre-qualification meetings with Shell in The Hague, which he is excited about. “The head of that department is determined to make the seismic industry more environmentally sound. Typically, Shell does not accept a seismic company until they have a certain track record, but with what we are bringing to the table, Shell will be happy to fast-track the approval. And this is a fairly typical example of the reac-tions we’ve had from oil compa-nies. There is a lot of enthusi-

asm for this,” he concludes.

Gunnar Haug, regional director of Ulstein Middle East.


PROJECTS


Ongoing and upcoming projectsInformation is supplied by Ventures Middle East. Tel: +971 2 622 2455. URL: www.ventures-uk.comBAHRAINProject Title Client Consultant EPC Contractor Budget ($M) Status

Redevelopment of the Refi nery in Bahrain Bapco Chevron Lummus Global (US) Not Appointed 100 FEED

Redevelopment of Awali Onshore Oil Field Bapco / National Oil and Gas Authority (NOGA) / Occidental Petroleum Corporation (US)

Not Appointed 1000 Study

Lube Base Oil Project Bapco / Nestle Jacobs Engineering Samsung Engineering Company 430 Execution

Offshore Field Development Bapco Fugro Robertson Limited (UK) Occidental Petroleum Corporation / PTT Exploration and Production (PTTEP)

2000 Execution

KUWAITPtitle Client Consultant EPC Contractor Budget ($M) Status

Project Kuwait Scheme KPC / KOC Sproule Associates Limited (Canada) Not Appointed 7000 FEED

Gas Pipeline From BS-131 to Mina Al Ahmadi KOC AMEC Petrofac International 544 Execution

Crude Oil Manifold at GC 27 KOC Not Appointed 30 EPC Bid

Gathering Center 16 in West Kuwait KOC Fluor Corporation Not Appointed 750 EPC Bid

Gathering Centre 24 at Sabriya KOC AMEC SK Engineering & Construction 621 Execution

Repair and Replacement of Pipelines in Southeast Kuwait KOC Arabi Enertech 17 Execution

Replacement of Oily & Effl uent Water Lines at GC 23 and GC 25 KOC Instruments Installation and Maintenance Co. (ImCo)

4 Execution

Effl uent Water Injection Phase I & Sea Water Injection Phase II KOC AMEC, Kuwait Not Appointed 750 FEED

Transit Line from Abdali Main Point to Abdali Mid-Point Manifold KOC Not Appointed 30 EPC Bid

Crude Oil Flow Pipelines in North Kuwait KOC Not Appointed 110 EPC Bid

Gas Compressor at GC 16 & Gas Reinjection at Minagish KOC Safwan Petroleum Technologies 67 Execution

Gas Pipeline between Booster Station 140 & GCMB Manifold KOC United Gulf Construction Company (UGCC)

7 Execution

LPG Filling Plant at Umm Alaish KOTC Not Appointed 100 FEED

Mina Al Ahmadi Refi nery Upgrade - Phase 1 KPC Fluor Corporation Almeer Techical Services Company/ Flour Corporation

140 Execution

Upgrade of South Ghudair Gathering Centre KOC / SAT Arabi Enertech 27 Execution

Flowlines Upgradation & General Support Services Saudi Arabian Texaco/ KGOC Mushrif Trading 23 Execution

Maintenance Services for KOC KOC Petrofac, Kuwait 125 Execution

Mina al Ahmadi - Doha West Pipeline Ministry of Energy (Electricity & Water) Penspen International (UK) Heavy Engineering Industries & Shipbuilding Company (Heisco)

128 Execution

Gas Booster Station 160 KOC AMEC, Kuwait Snamprogetti Kuwait 649 Execution

Maintenance of Mina Abdullah Refi nery in the South Kuwait National Petroleum Company (KNPC)

Kharafi National, Kuwait 111 Execution

Jurassic Early Production Facility (EPF) KOC Not Appointed 400 EPC Bid

Booster Station 132 KOC Not Appointed 800 EPC Bid

Drilling Service in Kuwait - Contract 4 KOC Weatherford Oil Tools Middle East 80 Execution

Al Zour North Project - Pipeline Packages Ministry of Energy NJS Consulting/Al Dowailah Not Appointed 136 EPC Bid

New Base Oil Plant at Shuaiba KNLOC Not Appointed 400 Study

Dry Crude Storage Tank at Gathering Centre 1 KOC Bridge and Roof Company 9 Execution

Gathering Center 14 in the South East KOC Almeer Technical Services 45 Execution

OMANProject Title Client Consultant EPC Contractor Budget ($M) Status

Sohar Bitumen Refi nery Sohar Industrial Port Company (SIPC) Mashael Group of Companies 200 Execution

Nimr C Full Field Water Injection Project PDO Al Hassan Engineering 65 Execution

Harweel Cluster Phase - 2 Petroleum Development Oman (PDO) AMEC, Abu Dhabi Petrofac International, Oman; Galfar Engineering & Contracting, Oman;

960 Execution


PROJECTS

Project Title Client Consultant EPC Contractor Budget ($M) Status

Crude Oil Stabilisation Unit at Mukhaizna Occidental Mukhaizna Not Appointed 55 EPC Bid

Mabrouk Field Project PDO Galfar/Integrated Engg. & Construction Co;

1500 Execution

Asphalt Plant at the Sohar Refi nery Complex Sohar Refi nery Company Engineers India Ltd. Not Appointed 80 FEED

Gas Compressor Station at the Nimr fi eld Oman Gas Company Tecnicas Reunidas / Worley Parsons Galfar Engineering & Contracting, Oman 36 Execution

Octal Petrochemical Project at Salalah Free Zone Octal Holding Uhde National Construction & Trading Co. LLC (NCTC)

700 Execution

Kauther Gas Compression Project PDO Petrofac International, Oman 350 Execution

Aromatics Complex in Sohar AOL Jacobs Engineering LG International / GS Engineering & Construction

1200 Execution

Two New Gas Pipelines in the South of the Sultante PDO Not Appointed 101 - 250 EPC Bid

Depletion-Compression Project at Saih Nihayda Petroleum Development Oman (PDO) Not Appointed 350 EPC Bid

Pipeline Between the Nimr Field and the Port City of Salalah Oman Gas Company Not Appointed 51 EPC Bid

Marmul Central Development - Phase 3 Petroleum Development Oman (PDO) Gulf Petrochemicals Services, Oman 61 Execution

Qarn Alam EOR Project - Off-plot Package PDO Galfar Engg. & Cont. 139 Execution

Qarn Alam EOR Project - On-plot Package PDO MEG WorleyParsons Dodsal 450 Execution

Methanol Plant in Salalah Oman Oil Company (OCC) / UK GTL Resources / Mubadala Development Company, Oman / Vitol

Jacobs Engineering GS Engineering & Construction 910 Execution

Oil & Gas Pipeline in Musandum Oman Oil Company (OCC) Not Appointed 500 EPC Bid

Saih Rawl Gas Depletion Project PDO Tecnicas Reunidas, Oman Bahwan Engineering Company (BEC) 545 Execution

QATARProject Title Client Consultant EPC Contractor Budget ($M) Status

Petrochemical Complex at Ras Laffan QP/Total Not Appointed Not Appointed 3000 Concept

Low-Sulphur Condensate Storage Facility at Ras Laffan Dolphin Energy Limited, Qatar Qatar Engineering & Construction Company

212 Execution

Al-Shaheen Oil Refi nery Qatar Petroleum Axens France Not Appointed 5000 EPC Bid

Block 4 North Qatar Petroleum/Anadarko Not Appointed Wintershall, Germany 150 Execution

Acid Gas Removal Pant in Dukhan Qatar Petroleum (QP) Technip, Qatar Not Appointed 350 EPC Bid

Melamine Project at Mesaieed Qatar Melamine Co. Eurotecnica/Urea Casale QECC 250 Execution

Petrochemical Complex at Ras Laffan QP /ExxonMobil Corporation Not Appointed Not Appointed 3000 FEED Bid

Subsea Pipelines Pkg. for Qatar Gas 3 & Qatar Gas 4 Qatar Petroleum (QP) J Ray McDermott, Dubai 100 Execution

Oryx GTL - Phase 2 QP/Sasol/Chevron Not Appointed 1400 Study

Gas Pipeline Network within Ras Laffan Industrial City Qatar Petroleum Mott MacDonald Qatar Larsen & Toubro, Qatar 123 Execution

Olefi ns Complex QP/ Shell Not Appointed Not Appointed 2500 Study

PROJECTS



Condensate Refi nery at Ras Laffan Laffan Refi nery Company Technip, Qatar Daewoo Engineering & Construction, Qatar; GS Engineering & Construction, Qatar;

602 Execution

Pearl GTL Project - Pipelines Package QP/Royal Dutch/Shell JGC Corporation/Halliburton J Ray McDermott 150 Execution

Q-Chem 2 Q-Chem Aker Kvaerner Daewoo Engineering & Construction, Qatar

700 Execution

Pearl GTL Project - Package C8 QP/Royal Dutch/Shell JGC Corporation/Halliburton Veolia/Saipem/Al Jaber 101 - 250 Execution

Pearl GTL Project - Storage Tanks Package QP/Royal Dutch/Shell JGC Corporation/Halliburton CB&I 400 Execution

QVC Expansion Project QVC Not Appointed Not Appointed 31 -100 Study

Ras Laffan-Mesaieed Ethylene Pipeline Q Chem ll / Ras Laffan Olefi ns Co. Punj Lloyd 45 Execution

Methanol Capacity Expansion at Mesaieed Qafac Mustang Tampa Not Appointed 501 - 750 FEED

Gas to Liquids Project-3 (Pearl GTL) QP/Royal Dutch/Shell JGC Corporation/Halliburton Consolidated Contractors International Company (CCC)

16000 Execution

Low Density Polyethylene Unit at Mesaieed Qapco Uhde Uhde/Tefken 549 Execution

Al Shaheen Project - Packages 17 & 18 Maersk Oil Qatar NPCC 600 Execution

HFO Bunkering Project Qatar Petroleum Maritime Industrial Services 60 Execution

Condensate Refi nery at Ras Laffan - Phase 2 Laffan Refi nery Company Not Appointed 800 Study

Al Khaleej Gas Development Phase 2 - Onshore Package Exxon Mobil/ Ras Gas Chiyoda Chiyoda/Technip 1600 Execution

Plateau Maintenance Project Qatargas Technip, Qatar Not Appointed 1200 EPC Bid

Al Shaheen Project - Package 13 Maersk Oil Qatar J Ray McDermott 185 Execution

Two New Glycol Regeneration Trains in Dukhan Qatar Petroleum Worley Parsons Qatar Kentz 101 - 250 Execution

Ras Gas 3 - Trains 6 & 7 Rasgas 3 Chiyoda Foster Wheeler Chiyoda/Technip 13000 Execution

Qafco V Qafco Not Appointed Saipem/ Hyundai Engineering & Construction Co

3200 Execution

Al Shaheen Project - Package 12 Maersk Oil Qatar Qatar Engineering & Construction Company

100 Execution

dry gas mechanical seals & repair •engineered mechanical seal support systems •

advanced air coolers •bearing protection •mechanical seals •

reliability focused engineering

www.aesseal.com

contact: don van rooyenemail: [email protected]: +971 4 2669595 / +971 2 6778700cell: +971 (0) 508120142

solutions extending equipment life


PROJECTS


Headworks for Muaither RPS and Associated Pipelines Qatar General Electricity & Water Corporation (Kahramaa)

Al Waha Contracting 109 Execution

Ethane Cracker cum Aromatics Complex at Mesaieed QP/Honam Foster Wheeler Not Appointed 3500 EPC Bid

Common Sulphur Project DEL Washington Group International Not Appointed 101 - 250 FEED

Pearl GTL Project - Wellhead Platforms Package QP/Royal Dutch/Shell JGC Corporation/Halliburton J Ray McDermott 300 Execution

Al Khaleej Gas Development Phase 2 - Offshore Package ExxonMobil Corporation/ RasGas Company limited (Ras Laffan Liquefi ed Natural Gas Company );

Chiyoda Corporation, Qatar J Ray McDermott, Qatar 300 Execution

Gas Sweetening Facilities Integrated Project at Mesaieed Qatar Petroleum Worley Parsons Not Appointed 350 EPC Bid

Doha Urban Pipeline Relocation Project Qatar Petroleum Tebodin Punj Lloyd 181 Execution

Pearl GTL Project - Package C2 QP/Royal Dutch/Shell JGC Corporation/Halliburton Linde 900 Execution

SAUDI ARABIA Project Title Client Consultant EPC Contractor Budget ($M) Status

Marjan, Zuluf and Safaniya Oil Fields Upgrade Saudi Aramco WorleyParsons J Ray McDermott 250 Execution

South Rub Al Khali Gas Development SRAK KCA Deutag Drilling 2000 Execution

5 Sulfur Recovery Units in Uthmaniyah & Shedgum Saudi Aramco Imad Company for Trading & Contracting 150 Execution

Shbab-1 Oil Pipeline Project Saudi Aramco Stroytransgaz 200 Execution

Sasref Refi nery - Ultra-low Sulphur Diesel Complex Sasref ABB Lummus Global ABB Lummus Global 350 Execution

Jubail-2 Export Refi nery - Pipeline and Offsite Package Saudi Aramco/Total Technip Gulf Consolidated Contractors (GCC) 300 Execution

Onshore Maintenance Potential Project Saudi Aramco RHM/CAT/Suedrohrbau 300 Execution

Sasref Refi nery - Control Systems Upgrade Sasref Petrocon Arabia / Yokogawa Middle East 100 Execution

Biaxially Oriented Polypropylene Plant (BOPP) in Dammam Rowad National Plastics Co. DMT Technology Holding 53 Execution

Yanbu Gas Plant Expansion Saudi Aramco Jacobs Engineering Inc. Enppi 180 Execution

Jubail-2 Export Refi nery - Distillation and Hydrotreating Saudi Aramco / Total Tecnicas Reunidas (TR) 1200 Execution

Petrochemical Complex - Polyolefi ns Package SCP Parsons E&C Daelim Industrial Company 1200 Execution

Ras Tanura Refi nery Saudi Aramco WorleyParsons Not Appointed 8000 Feed

Ras Abu Ali Upgrade Saudi Aramco Zuhair Fayez Partnership Consultants Bonatti S.p.A 160 Execution

Hawiyah Plant Expansion Saudi Aramco Jacobs Engineering Inc. Tecnicas Reunidas 400 Execution

Shedgum - Yanbu NGL Line Expansion - Phase 2 Saudi Aramco Suedrohrbau 200 Execution

Ras Tanura Refi nery - DHT Unit Saudi Aramco Foster Wheeler Samsung Saudi Arabia Ltd. 500 Execution

Refi ning & Integrated Petrochemicals Complex Nama Not Appointed 1500 Study

Ebgaig - Al Khobar Natural Gas Pipeline SWCC Not Appointed 100 FEED

Ethylene Amines Project At Jubail Arabian Amines Company Jacobs Engineering / Burns & McDonnell Engineering

Hyundai E&CC / Hanwha E & C 300 Execution

Jubail - 2 Export Refi nery - Aromatics Plant Saudi Aramco / Total Axens Samsung Saudi Arabia Ltd. 650 Execution

Jubail-2 Export Refi nery - Coker Unit Package Saudi Aramco / Total Foster Wheeler Samsung Saudi Arabia Ltd / Chiyoda Corporation

850 Execution

Karan Field Exploration - Platforms Package Saudi Aramco J Ray McDermott 500 Execution

New Domestic Refi nery in Jubail Saudi Aramco Not Appointed 5000 EPC Bid

Jubail Petrochemical Complex - Phase 3 Sipchem Not Appointed 8000 EPC Bid

Petrochemicals Complex in Yanbu Saudi Aramco / Sabic Not Appointed Not Appointed 3000 Study

Karan Field Exploration - Onshore Elements Package - Gas Facilities Saudi Aramco Foster Wheeler /A. Al Saihati , A. Fattani & Al Othman Consulting Engineering Company (Sofcon)

Hyundai Engineering & Construction Company (HDEC)/ Petrofac

600 Execution

Rabigh Refi nery Expansion - Phase 2 Petro-Rabigh / Saudi Aramco / Sumitomo Corporation

JGC Corporation Not Appointed 4000 FEED

Ammonia Plant In Jubail Sipchem Haldor Topsoe Not Appointed 10 FEED

Khurais Field Development - Gas-Oil Separation Plants (GOSPs) Package Saudi Aramco Jacobs Engineering Group Inc. Snamprogetti / Imad Company for Trading & Contracting

1300 Execution

Yanbu Export Refi nery - Hydrocracker Package Saudi Aramco/ConocoPhilips Kellogg Brown & Root (KBR) Not Appointed 1200 EPC Bid

Jubail-2 Export Refi nery - Storage Tank Package Saudi Aramco / Total Technip, Saudi Arabia Punj LIoyd Ltd / Petro Steel 1000 Execution

Karan Field Exploration - Offshore Elements Package Saudi Aramco Petrocon Arabia, Saudi Arabia J Ray McDermott 1000 Execution

Fertiliser Complex Expansion at Jubail - Urea & Ammonia Plant Saudi Arabian Fertilizer Company (Safco) Not Appointed 150 EPC Bid

PROJECTS



PROJECTS

Wafra Steam Injection - Phase 2 Chevron / Saudi Aramco Saudi Arabian Texaco INC 500 Execution

Jubail - 2 Export Refi nery - Plant Utilities Package Saudi Aramco / Total Technip SK Engineering & Construction 150 Execution

Manifa Oil Field Redevelopment - Onshore Package Saudi Aramco Foster Wheeler JGC Corporation / TR / Snamprogetti 2500 Execution

Manifa Oil Field Redevelopment - Platforms Package Saudi Aramco J Ray McDermott, Saudi Arabia 800 Execution

Ras Tanura Petrochemicals Complex Saudi Aramco / Dow Kellogg Brown & Root Not Appointed 17000 FEED

ASU at Jubail National Industrial Gas Company (GAS) Samsung Saudi Arabia Ltd. 300 Execution

Petrokemya - 4 in Jubail Petrokemya Technip / Aker Kvaerner Not Appointed 10 FEED

Upgrade of the Oil Refi nery at Yanbu Saudi Aramco Mobil Refi nery Company Ltd. (Samref)

Worley Parsons, Saudi Arabia Worley Parsons, Saudi Arabia 2000 Execution

Sasref Refi nery Expansion Sasref ABB Lummus Global Not Appointed 275 FEED

UNITED ARAB EMIRATESProject Title Client Consultant EPC Contractor Budget ($M) Status

Replacement of Oil & Water Pipelines Adma - Opco Technip / Worley Parsons, Abu Dhabi Costain 900 Execution

Adnoc Storage Facility in Hamriyah Free Zone Takreer Not Appointed 150 EPC Bid

Borouge Complex Expansion - Phase 2: Offsites and Utililies AUH Polymers Company Foster Wheeler Technicas Reunidas 1230 Execution

Hail Field Development ADCO / Gasco Not Appointed Not Appointed 749 Study

Crude Oil Pipeline Replacement Zadco Not Appointed 300 EPC Bid

OGD-3/ AGD-2 - Pack 2 GASCO Bechtel Bechtel 1460 Execution

OGD-3/ AGD-2 - Pack 4 GASCO Bechtel Snamprogetti 1420 Execution

Green Diesel Project in Ruwais Takreer Wood Group Mustang GS Engineering & Construction 350 Execution

Umm Shaif Gas Injection Facilities Adma - Opco WorleyParsons Hyundai Heavy Industries 1597 Execution

Modifi cations to 41 Well Head Towers Adma - Opco WorleyParsons Not Appointed 150 EPC Bid


PROJECTS


Zakum West Gas Processing Facilities Project Adma - Opco Technip Technip / NPCC 300 Execution

Asab Full Field Development ADCO Foster Wheeler Petrofac 1000 Execution

Bab Oil fi eld Development - Phase 2 ADCO Technip SK Engineering & Construction Company 805 Execution

Gas Processing Facility in UAQ Gulf Energy Company Technip/Kvaerner Not Appointed 120 EPC Bid

Umm al Dalkh Full Field Development Zadco Not Appointed Not Appointed 650 Study

Sahil Phase-2 Development ADCO Foster Wheeler Tecnicas Reunidas / CCC 250 Execution

Onshore and offshore Sour Gas Development ADNOC / ConocoPhilips Fluor Corporation Not Appointed 10000 EPC Bid

IGD - Gas Processing Platform - Pack 6 Adnoc / Adma-Opco Fluor Corporation Abu Dhabi NPCC 405 Execution

Borouge Complex Expansion - Phase 2: Olefi ns Conversion Unit AUH Polymers Company ABB Lummus Global, Abu Dhabi Samsung Corporation, Dubai 300 Execution

Fertil Plant Expansion Fertil Jacobs Engineering Not Appointed 450 EPC Bid

OAG Network-Das Island Compression Facilities Adgas Fluor Corporation Technip 610 Execution

OAG Network-Pack 2 - Das Island to Ras Al Qila Pipeline Gasco Fluor Corporation NPCC 241 Execution

OAG Network-Pack 3 - Ras Al Qila to Habshan Pipeline Gasco Fluor Corporation CCC 400 Execution

OGD-3/ AGD-2 Pack 3 GASCO Bechtel Bechtel 1241 Execution

Borouge Complex Expansion - Phase 2: Ethane Cracker AUH Polymers Company Linde 1100 Execution

Development of Qusahwira & Bida Al-Qemzan Fields ADCO Washington Group International / Veco Engineering

Not Appointed 1800 EPC Bid

Taweelah-Qidfa Gas Pipeline DEL Stroytransgaz, Abu Dhabi 418 Execution

Asab Gas Development (AGD) Modifi cations - Package 1 GASCO Veco Engineering Not Appointed 500 EPC Bid

Jebel Dhanna Crude Oil Storage Tanks Adco ILF Consulting Not Appointed 100 EPC Bid

LNG Storage Hub in Techno Park, Dubai DMCC / Techno Park / LNG Impel Not Appointed 2000 FEED

Umm Al Lulu Oil Field Development Zadco Tebodin Middle East, Abu Dhabi Not Appointed 1500 EPC Bid

New Refi nery in Fujairah AGOL Mott MacDonald Not Appointed 1000 Study

Borouge Complex Expansion - Phase 3: PDH & Phenolics Complex AUH Polymers Company Not Appointed Not Appointed 1000 Study

Abu Dhabi Gas Grid ADNOC Distribution Not Appointed Not Appointed 1000 Pre FEED Bid

Zirku Production Facilities Debottlenecking Zadco Technip, Abu Dhabi Not Appointed 450 EPC Bid

Upper Zakum - Fujairah Oil Pipeline IPIC/Conoco Phillips WorleyParsons China Petroleum Construction Corporation

3290 Execution

Flowlines & Wellhead Installations to ADCO Abu Dhabi Company for Onshore Oil Operations (ADCO)

Mott MacDonald Al Husam General Contracting 100 Execution

Tank Terminals in Fujairah Emarat Penspen International Not Appointed 22 EPC Bid

Khubai-Margham Gas Pipeline Margham Dubai Est. Parsons Brinkerhoff Not Appointed 30 FEED

Integrity Enhancement of Fire Protection System at Umm Al Nar Refi nery Takreer Not Appointed Not Appointed 15 EPC Bid

Integrated Gas Development (IGD) - Das Island Process & Utilities Package Adnoc / Adgas Fluor Corporation Hyundai Heavy Industries(HHI),Abu Dhabi 1000 Execution

Satah Full Field Development Zadco Tebodin Middle East, Abu Dhabi Not Appointed 250 FEED

Expansion of Sulphur Handling Facility in Ruwais Takreer Washington Group Int'l Dodsal 272 Execution

Cathodic Protection on Wellhead Casing in Bab and Ruwais Fields ADCO ILF Consulting Engineers, Abu Dhabi EMDAD LLC, Abu Dhabi/ Alsa Engineering 27 Execution

Gas Exploration Facilities - Kahaif, Moveyid and Sajaa BP Exploration Operating Co Ltd(BP Sharjah)

AMEC, Abu Dhabi Not Appointed 500 FEED

Expansion of Ruwais Refi nery - Package 1 Takreer Bechtel Not Appointed 400 EPC Bid

Crude Oil Storage Tanks at Umm al-Nar Refi nery Takreer Engineers India Ltd Al Hussam General Contracting 33 Execution

New SCADA System at Umm Shaif and Lower Zakum Adma - Opco WorleyParsons Telvent 50 Execution

Integrated Gas Development (IGD) - Ruwais Storage Tanks Package Gasco / Adnoc Fluor Corporation Chicago Bridge & Iron (CB&I), Dubai 533 Execution

NGL Pipeline from Asab to Ruwais Gasco VECO Dodsal 153 Execution

Gas Injection Topsides at Upper Zakum Zadco Technip Not Appointed 400 FEED

Shah Full Field Development Adco Foster Wheeler CCC / Tecnicas Reunidas 250 Execution

Integrated Gas Development (IGD) - Ruwais 4th NGL Train Package ADNOC / Gasco Fluor Corporation, Abu Dhabi Petrofac International / GS Engineering & Construction

2100 Execution

Refi nery in Fujairah IPIC Foster Wheeler Not Appointed 12000 Concept

November 2009 Oil&Gas Middle East 87www.arabianbusiness.com/energy

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FACE TO FACE

What trends have you seen in the Middle East upstream business?I would say that for the oil and gas sector the market is pretty stable here. The national oil companies obviously have a role in bringing revenues to the Gulf states, so inde-pendent of the oil price, activities continue to be extended. Also, the international companies here are engaged in truly mega-projects. I don’t see a dip in that industry.

Where can oil and gas companies save money? Having generators and compres-sors on a platform is not very effi-cient. We offer a solution which provides a link to the shore – and we are talking with customers in the Gulf area now about this. We have a DC link from the shore to a platform, and then AC distribu-tion to the other platforms. Essen-tially one cable extends from the shore, and then distributes the energy from a hub platform. That’s much more efficient because you can generate the electricity from a power plant, instead of a generator. Some local firms are looking at this with interest.

How are you approaching the Iraq upstream market?We have the strategy in place, and we will be doing some business there this year, but safety is still an issue. We need to be cautious. The

Houston mirrors Abu Dhabi in resilience to tough 2009

FACE TOFACE Veli-Matti Reinikkala, president, ABB Process

Automation

first phase is going to be rebuilding the power infrastructure. When that is in place we expect the indus-trial plant business to take off.

What’s your 2010 forecast?I think that the market for oil and gas in 2010 will be roughly the same. My expectation is that we will grow in oil and gas, because that has been our trajectory for several years.

How often are you in the Middle East?I am in the Middle East at least once or twice a year, but I often have the regional and local managers over to Houston for group meetings. I’m primarily here to meet the customers and catch up with the managers. It’s important for me that we are still in dialogue with our customers even when orders aren’t necessarily coming. It’s important to stay in touch and visit them. It’s also polite!

How has Houston been affected by the credit crunch?Houston is of course an energy town, but it didn’t go through the same bubble as many American cities. House prices remained steady and didn’t shoot through the roof. Houston was hit of course, but it’s still better than the US average. There are some signs of general recovery in sight now.

“It’s important that we are still in dialogue with our customers even when orders aren’t necessarily coming. It’s polite”

Veli-Matti Reinikkala, president, ABB Process Automation during his UAE visit.

Documents

Oil & Gas Middle East - Nov 2009