Muscat, Oman: Citing MEED Insight’s ‘MENA Oil and Gas Report 2017’ Oil, an article in the Oman Daily Observer’s website has said that oil, gas and petrochemicals projects of nearly USD 294 billion are currently underway in the MENA region even as concerns are being expressed about the global oversupply of oil which is suppressing oil prices. Last year, the crude oil prices slipped to a 13-year low due to the global oversupply, the report observed.

Giving a brief overview of the market, the article said: “The drop in crude revenues coincided with an eight-year low in the value of engineering, procurement and construction (EPC) contracts awarded in the regional oil, gas and petrochemicals sectors. Investment in the Mena hydrocarbons industries hit an eight-year low in 2016, dropping 34 per cent to $32.4 billion.”

The article highlighted that with countries, such as Saudi Arabia and UAE, studying the higher-cost shale gas and sour gas, gas spending is likely to increase.

Furthermore, the article said that the GCC region has been witnessing an upstream investment due to domestic and international demand. Region-wise, the article noted that “Saudi Arabia, the UAE, Kuwait and Qatar have all raised their sustainable crude oil production capacity, while Oman has managed to reverse a slump in output through its enhanced oil recovery (EOR) programme. Outside the GCC, production capacity and output has stagnated or fallen in Algeria, Egypt and Libya, mainly due to the political problems in those states. Iraq has been able to increase capacity through one of the world’s largest upstream investment programmes”.

Kuwait received a mention in the report for reportedly being the biggest spender in the past two years, with a capital spending of approximately USD44.3 billion on oil and gas projects.

Quoting Richard Thompson, Editorial Director of MEED, from the report, the article said, “With an estimated $294 billion-worth of projects in the pre-execution phase, the sector provides a wealth of opportunity for business from Saudi Arabia’s ambitious oil-to-chemicals complex to the re-emergence of the Iran oil industry following years of sanctions.”