Major operators in the GCC are refocussing their strategies towards the downstream industry. The recent announcements from Saudi Aramco, ADNOC and ENOC, to mention few, planning huge investments to the sector, stand as testimony to the new dynamism gathering around the downstream industry in the region.
For example, few days back, the Supreme Petroleum Council of the United Arab Emirates gave the green light to ADNOC to pursue international downstream investments that will position ADNOC as a global player in the dotwnstream market. It is interesting to note here that the Supreme Petroleum Council approval was for ADNOC’s plans for capital expenditure of over $108bn, over the next five years, as it embarks on its upstream and downstream expansion and growth projects.
The downstream industry in the Middle East is currently at the forefront of economic transformation, job creation and development, serving as a key enabler for the region’s economic growth. As many ‘transformational’ new, highly complex projects come on stream during 2017-2018, growth is set to continue at a faster pace for the region’s downstream sector.
The downstream capacity has been increasing steadily since 2010 in the Middle East, thanks to rising domestic demand and progressive moves to increase exports. As much-needed investments in the oil and gas sector pick up this year and beyond, alongside prices, there is a more positive outlook for the downstream business. The Middle East is forecasted to be the fastest growing region in terms of refining capacity in the next decade.
In an era of low oil prices being the accepted norm of the industry, it is worth mentioning here that this year, the operators in the GCC attained momentum in resetting their priorities to the strategic move towards creating a vibrant and promising downstream industry for the region. I hope 2018 will witness many watershed downstream initiatives in the region.