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United Arab Emirates Oil and Gas report Q4 2012

Friday, Nov 09, 2012

Research and Markets ( has announced the addition of the "United Arab Emirates Oil and Gas Report Q4 2012" report to their offering.

“United Arab Emirates Oil and Gas Report Q4 2012”

The UAE has delivered on its stated ambitions to raise sustainable oil production capacity to 2.7-2.8mn b/d, compensating for missing Iranian barrels. Further increases are likely to materialise by year-end 2012. Meanwhile, the start of commercial oil exports through the Fujairah pipeline marks a significant new stage in the UAE's export capabilities.

We Highlight the Following Trends and Developments in the Uae's Oil and Gas Sector:

- Our view is that the UAE's proven oil reserves will slip gradually over the period to 2016,

dropping to 91.3bn barrels (bbl) from the end-2011 total of 96.7bn, and this will fall in subsequent years to 85.3bn by 2021.

- With around 1mn barrels per day (b/d) of Iranian crude removed from the market due to sanctions, the UAE is one of the countries that are taking up the slack - taking advantage of investment in production capacity. Output in mid-2012 has averaged 2.7mn b/d, with overall sustainable production capacity at 2.8mn b/d.

- Gas production will get a big mid-decade boost from the start-up of the Shah sour gas project.

- By 2016, we see output of around 67bn cubic metres (bcm), rising to 74bcm by 2021.

- A further 200,000b/d of output is expected by Q412, bringing total production capacity above 3mn b/d. Abu Dhabi is planning to spend US$60bn over the next five years to raise production capacity above 3.5mn b/d. The increase in production capacity has helped support an increase in 2012 oil production; UAE crude output in August 2012 was estimated at 2.7mn b/d.

- A major ongoing sour gas project should help boost domestic production of gas, as consumption doubles in the period 2010-2020. The US$10bn Shah sour gas project will add 9,8bcm of gas capacity when it comes onstream in 2015.

- Liberalisation of fuel prices is unlikely in the short term, owing to the government largesse following political unrest across the Middle East and North Africa (MENA) region in 2011.

Fuels distribution in the UAE will therefore remain a loss-making proposition.

Discussions are ongoing with regard to changes in contractual terms on offer for international oil companies (IOCs) involved in ADNOC field developments. Foreign companies are arguing for improved per barrel terms, currently estimated at just US$1.

Source: Business Wire

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