The Middle East will be a key market for oilfield services companies for decades to come as countries across the region seek to maximize recovery from maturing assets and bring new fields into production, reports energy specialist corporate advisory firm Simmons & Company International Ltd.
Speaking at a conference in Abu Dhabi, Nick Dalgarno, co-head of eastern hemisphere corporate finance at Simmons, said there is an increasing willingness among governments and the national oil companies to build relationships with foreign companies to bring know-how and technology into the region.
The oil and gas and wider energy factors driving this include the accelerating need for enhanced oil recovery, sour gas, heavy oil, tight gas, LNG, GTL, “clean fuels” refineries, carbon capture and storage, nuclear and solar technologies.
Just over half of the world’s proven conventional oil reserves and 42% of the world’s proven conventional gas reserves are located in the Middle East and North Africa (MENA). The region has 13 of the world’s 20 giant oilfields, as well as the largest gas field in the world. There is an estimated US$3 trillion of projects underway or planned in the six Gulf Cooperation Council countries (Saudi Arabia, United Arab Emirates, Kuwait, Oman, Bahrain and Qatar) plus Iraq and Iran. The majority of these relate to upstream oil and gas, downstream (including refineries, LNG and GTL), petrochemicals and related infrastructure projects.
“Iran is also an enormous untapped market, which, when it is eventually rehabilitated into the international community, will have to address decades of underinvestment in its oil and gas industry,” said Dalgarno.