GCC Oil and Gas Industry Overview-January 2013
Economies in the Gulf Cooperation Council (GCC) namely, Saudi Arabia, United Arab Emirates (UAE), Qatar, Kuwait, Bahrain and Oman, after decades of growth following the first discovery of oil in the sixties, have come a long way to dominate the world hydrocarbons market Accounting for over 40 percent of the world’s hydrocarbon reserves (40 percent comprises oil, 23 percent natural gas) as of 2012. This share is also likely to grow to 70 percent by the end of the decade according to a study by Kuwait based Diplomatic Center for Strategic Studies promising a large growth potential in the closely government guarded and highly regulated GCC upstream sector. Recent years have witnessed GCC economies reaping rich dividends from the burgeoning global demand for oil and gas and the high oil prices on the one hand. On the other, these economies have been forced to walk a tight rope to balance their equally fast growing domestic demand for the fossil fuels with maintaining enough export surpluses and augmenting capacities from the fast depleting non-renewable reserves. As the hydrocarbon industry matures, these economies have begun to realize the value of diversification of their economies so as to reduce their dependence on hydrocarbons and begun judiciously ploughing back their hydrocarbon surpluses into ambitious programmes of industrialization, diversification and expansion.
While hydrocarbon industry continues to form the backbone of these economies accounting for more than three fourths of their government revenues and over half of their exports, the hydrocarbon industry on its own has witnessed a subtle shift from core upstream projects into downstream activities of refining, petrochemicals and storage tanks, each vying with the other to enhance their refining capacities to exploit this trend to the maximum. Investments in the energy sector across the GCC total US$ 470 billion between 2010 and 2015, of which oil and gas accounted for 47 percent and 36 percent, respectively of the total. Contracts worth US$ 39,405 million were awarded across the GCC hydrocarbon sector in 2012 of which downstream projects accounted for 82 percent with a large focus on petrochemicals, overtaking the earlier emphasis on refining, reflecting the maturing nature of the industry and its need for diversification. The GCC petrochemicals sector has witnessed promising growth with a Compound Annual Growth Rate (CAGR) of 26 percent between 2007 and 2011 despite financial instabilities across the region and among its trading partners and continues to demonstrate strong potential in spite of the worsening global economic conditions, especially its key trading partner Europe with its financial woes and other prime markets. The challenges likely to be faced by the industry in the prevailing economic climate are manifold, including external financing, retaining economic growth while reducing vulnerabilities to external shocks. This report examines the nature of the GCC hydrocarbon industry, its regulatory structure and its growth trajectory, the developments across its upstream and downstream sectors including top projects and contracts awarded with forecasts up to 2014 and concludes with a comparative analysis of economic growth versus hydrocarbon growth across the GCC countries in 2012 and its absolute performance over a period of time.
While hydrocarbon industry continues to form the backbone of these economies accounting for more than three fourths of their government revenues and over half of their exports, the hydrocarbon industry on its own has witnessed a subtle shift from core upstream projects into downstream activities of refining, petrochemicals and storage tanks, each vying with the other to enhance their refining capacities to exploit this trend to the maximum. Investments in the energy sector across the GCC total US$ 470 billion between 2010 and 2015, of which oil and gas accounted for 47 percent and 36 percent, respectively of the total. Contracts worth US$ 39,405 million were awarded across the GCC hydrocarbon sector in 2012 of which downstream projects accounted for 82 percent with a large focus on petrochemicals, overtaking the earlier emphasis on refining, reflecting the maturing nature of the industry and its need for diversification. The GCC petrochemicals sector has witnessed promising growth with a Compound Annual Growth Rate (CAGR) of 26 percent between 2007 and 2011 despite financial instabilities across the region and among its trading partners and continues to demonstrate strong potential in spite of the worsening global economic conditions, especially its key trading partner Europe with its financial woes and other prime markets. The challenges likely to be faced by the industry in the prevailing economic climate are manifold, including external financing, retaining economic growth while reducing vulnerabilities to external shocks. This report examines the nature of the GCC hydrocarbon industry, its regulatory structure and its growth trajectory, the developments across its upstream and downstream sectors including top projects and contracts awarded with forecasts up to 2014 and concludes with a comparative analysis of economic growth versus hydrocarbon growth across the GCC countries in 2012 and its absolute performance over a period of time.
EXECUTIVE SUMMARY
CHAPTER1. GCC OIL AND GAS INDUSTRY OVERVIEW
Hydrocarbons Production, Consumption and Exportable Surplus
How Hydrocarbon Markets are Organized in the GCC Countries
Bahrain
Kuwait
Oman
Qatar
Saudi Arabia
United Arab Emirates (UAE)
The Life Cycle and Future Direction of the GCC Hydrocarbon Regulatory Framework
CHAPTER2. OIL PRICES, GCC OUTPUT AND SURPLUSES
CHAPTER3. GCC HYDROCARBON SECTOR MARKET SIZE AND FORECASTS- 2013
GCC Oil and Gas Market
Construction Projects Awarded for the GCC for the Oil and Gas Sector (US$ Million), 2011-2014
CHAPTER 4.GCC UPSTREAM SECTOR
Bahrain
Saudi Arabia
The United Arab Emirates (UAE)
Qatar
Kuwait
Oman
CHAPTER5. GCC DOWNSTREAM SECTOR
Saudi Arabia
The United Arab Emirates (UAE)
Oman
Kuwait
Bahrain
Qatar
CHAPTER6. REGIONAL HYDROCARBON INDUSTRY OVERVIEW
Regional Hydrocarbon Sector Analysis
The GCC Hydrocarbon Sector and Economic Growth
Analysis of Oil Industry Growth versus Economic Growth
Analysis of Natural Gas Industry Growth versus Economic Growth
CHAPTER7. FUTURE FOCUS AND OUTLOOK FOR THE GCC OIL AND GAS INDUSTRY
Methodology
Code of Ethics
Ventures Onsite MENA Projects Database
CHAPTER1. GCC OIL AND GAS INDUSTRY OVERVIEW
Hydrocarbons Production, Consumption and Exportable Surplus
How Hydrocarbon Markets are Organized in the GCC Countries
Bahrain
Kuwait
Oman
Qatar
Saudi Arabia
United Arab Emirates (UAE)
The Life Cycle and Future Direction of the GCC Hydrocarbon Regulatory Framework
CHAPTER2. OIL PRICES, GCC OUTPUT AND SURPLUSES
CHAPTER3. GCC HYDROCARBON SECTOR MARKET SIZE AND FORECASTS- 2013
GCC Oil and Gas Market
Construction Projects Awarded for the GCC for the Oil and Gas Sector (US$ Million), 2011-2014
CHAPTER 4.GCC UPSTREAM SECTOR
Bahrain
Saudi Arabia
The United Arab Emirates (UAE)
Qatar
Kuwait
Oman
CHAPTER5. GCC DOWNSTREAM SECTOR
Saudi Arabia
The United Arab Emirates (UAE)
Oman
Kuwait
Bahrain
Qatar
CHAPTER6. REGIONAL HYDROCARBON INDUSTRY OVERVIEW
Regional Hydrocarbon Sector Analysis
The GCC Hydrocarbon Sector and Economic Growth
Analysis of Oil Industry Growth versus Economic Growth
Analysis of Natural Gas Industry Growth versus Economic Growth
CHAPTER7. FUTURE FOCUS AND OUTLOOK FOR THE GCC OIL AND GAS INDUSTRY
Methodology
Code of Ethics
Ventures Onsite MENA Projects Database
LIST OF TABLES
Table 1: Top Bahrain Upstream Projects by Value (US$ Million), 2013
Table 2: Top Saudi Arabia Upstream Projects by Value (US$ Million), 2013
Table 3: Top UAE Upstream Projects by Value (US$ Million), 2013
Table 4: Top Qatar Upstream Projects by Value (US$ Million), 2013
Table 5: Top Kuwait Upstream Projects by Value (US$ Million), 2013
Table 6: Top Oman Upstream Projects by Value (US$ Million), 2013
Table 7: Refineries and Refining Capacity across the GCC countries, 2012
Table 8: Top Saudi Arabia Downstream Projects by Project Value (US$ Million), 2013
Table 9: Top UAE Downstream Projects by Project Value (US$ Million), 2013
Table 10: Top Oman Downstream Projects by Project Value (US$ Million), 2013
Table 11: Top Kuwait Downstream Projects by Project Value (US$ Million), 2013
Table 12: Top Bahrain Downstream Projects by Project Value (US$ Million), 2013
Table 13: Top Qatar Downstream Projects by Project Value (US$ Million), 2013
Table 1: Top Bahrain Upstream Projects by Value (US$ Million), 2013
Table 2: Top Saudi Arabia Upstream Projects by Value (US$ Million), 2013
Table 3: Top UAE Upstream Projects by Value (US$ Million), 2013
Table 4: Top Qatar Upstream Projects by Value (US$ Million), 2013
Table 5: Top Kuwait Upstream Projects by Value (US$ Million), 2013
Table 6: Top Oman Upstream Projects by Value (US$ Million), 2013
Table 7: Refineries and Refining Capacity across the GCC countries, 2012
Table 8: Top Saudi Arabia Downstream Projects by Project Value (US$ Million), 2013
Table 9: Top UAE Downstream Projects by Project Value (US$ Million), 2013
Table 10: Top Oman Downstream Projects by Project Value (US$ Million), 2013
Table 11: Top Kuwait Downstream Projects by Project Value (US$ Million), 2013
Table 12: Top Bahrain Downstream Projects by Project Value (US$ Million), 2013
Table 13: Top Qatar Downstream Projects by Project Value (US$ Million), 2013
LIST OF FIGURES
Figure 1: GCC Proven Oil Reserves (Billion Barrels per Day (BBL) (As of January 1, 2012)
Figure 2: GCC Proven Natural Gas Reserves (Trillion Cubic Meters), 2012
Figure 3: GCC countries -Oil Production and Consumption (bbl/day), June 2012
Figure 4: GCC Natural Gas Production and Consumption (Billion Cubic Meters), June 2012
Figure 5: Sector Organization of the Bahrain Oil and Gas Industry, 2012
Figure 6: Organization of Kuwait Hydrocarbons Industry, 2012
Figure 7: Organization of the Oman Hydrocarbons Industry, 2012
Figure 8: Organization of the Qatar Hydrocarbons Industry, 2012
Figure 9: Organization of the Saudi Hydrocarbon Industry, 2012
Figure 10: Organization of the UAE Hydrocarbons Industry, 2012
Figure 11: OPEC Oil Basket Price (US$ per Barrel), 1999-2012
Figure 12: GCC Share of Hydrocarbons in Government Revenues and Exports by Country, 2012
Figure 13: GCC Oil and Gas Industry Budget Totals Split by Segment, 2013
Figure 14: GCC Oil and Gas Construction Contract Awards (US$ Million), 2011-2014
Figure 15: Share of GCC Oil and Gas Construction Contractor Awards by Country, 2012
Figure 16: GCC Countries Oil Sector Growth versus Economic Growth, 2012
Figure 17: GCC Countries Natural Gas Sector Growth versus Economic Growth, 2012
Figure 1: GCC Proven Oil Reserves (Billion Barrels per Day (BBL) (As of January 1, 2012)
Figure 2: GCC Proven Natural Gas Reserves (Trillion Cubic Meters), 2012
Figure 3: GCC countries -Oil Production and Consumption (bbl/day), June 2012
Figure 4: GCC Natural Gas Production and Consumption (Billion Cubic Meters), June 2012
Figure 5: Sector Organization of the Bahrain Oil and Gas Industry, 2012
Figure 6: Organization of Kuwait Hydrocarbons Industry, 2012
Figure 7: Organization of the Oman Hydrocarbons Industry, 2012
Figure 8: Organization of the Qatar Hydrocarbons Industry, 2012
Figure 9: Organization of the Saudi Hydrocarbon Industry, 2012
Figure 10: Organization of the UAE Hydrocarbons Industry, 2012
Figure 11: OPEC Oil Basket Price (US$ per Barrel), 1999-2012
Figure 12: GCC Share of Hydrocarbons in Government Revenues and Exports by Country, 2012
Figure 13: GCC Oil and Gas Industry Budget Totals Split by Segment, 2013
Figure 14: GCC Oil and Gas Construction Contract Awards (US$ Million), 2011-2014
Figure 15: Share of GCC Oil and Gas Construction Contractor Awards by Country, 2012
Figure 16: GCC Countries Oil Sector Growth versus Economic Growth, 2012
Figure 17: GCC Countries Natural Gas Sector Growth versus Economic Growth, 2012
