POST-OIL ADNOC-LEDGING THE THE TIME IS NOW · PDF filePOST-OIL AMBITIONS page 10 ADNOC-LEDGING...

NOVEMBER 2016

THE TIME IS NOW PAGE 18

UAE

POST-OIL AMBITIONS

page 10

ADNOC-LEDGING THE NEED FOR CHANGE

page 14

THE TIME IS NOW - COVER STORY page 18

Acknowledgements

Energy Boardroom would like to thank:

H.E. SULTAN AL JABER, Chief Executive Officer of ADNOC

H.E. SUHAIL AL MAZROUEI, Minister of Energy

H.E. THANI AL ZEYOUDI, Minister of Climate Change and Environment

ABDULKARIM AL MAAZMI, President and General Manager of BP

MUSABBEH AL KAABI, Chief Executive Officer of Mubadala Petroleum

HATEM NUSEIBEH, President of Total

UAE Oil & Gas 2016 3www.energyboardroom.com

CONTENTSNovember— 2016

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Looking To The Future Interview 10

ADNOC - Ledging the need for change Featured 14

UAE OIL & GAS

2 ACKNOWLEDGEMENTS

5 PREFACE

6 SNAPSHOT IN FIGURES

10 POST-OIL AMBITIONS INTERVIEW H.E. Dr. Thani bin Ahmed Al Zeyoudi, Minister of Climate Change & Environment

12 THE UAE’S NEW ENERGY MIX INTERVIEW H.E. DR. Matar Al Neyadi, Undersecretary, Ministry of Energy

14 ADNOC - LEDGING THE NEED FOR CHANGE FEATURE Forging an Innovation Nation

16 NICHE TECHNOLOGY INTERVIEW Sonny Sola, NORDIC

18 THE TIME IS NOW COVER STORY

19 Increasing Operational Efficiency

20 New technology is a Plus

22 Weathering the Storm

22 Avoiding the Clash of Civilizations

24 When Fire and Ice Combine

25 Localizing the Emirati Way

27 Becoming a true energy leader

27 Oiling the Gears of innovation

29 In it for the Long Haul

30 Strategically Investing in the future

32 MARITIME TRADE INTERVIEW Mohamed Al Shamisi Abu Dhabi Ports

34 SWEETENING THE OFFSHORE DEAL FEATURED

35 FIRE SAFETY INTERVIEW Gerry Boux, Haven Fire & Safety

38 PERFORMANCE OPTIMIZATION INTERVIEW David Mullen, Shelf Drilling

40 RENEWABLES INTERVIEW Badar Al lamki, Masdar clean Energy

The time is now Cover Story 18

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KRISHNASWAMY IYER – Regional Director UAE, Qatar, Iraq & North Africa, WorleyParsons

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OLAF GRIMM – Managing Director, Sigma Oilfield Services (Mazrui Holdings), Abu Dhabi

DR. STEVEN GRIFFITHS – Vice-President of Research & Interim Associate Provost, Masdar Institute of Science and Technology, Abu Dhabi

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PREFACE


The United Arab Emirates (UAE) ranks as one of the world’s top ten oil and gas producers, with proven reserves of 97.8 billion barrels (one-tenth of the glo-bal total) and production of around 3.1 million bpd in 2016. Notwithstanding its strong oil and gas fun-damentals, the new reality of USD 50 oil has not left this Gulf petrostate unscathed.

2016 has already been a year of unprecedented change, instigated by the ruling Al Nahyan family from Abu Dhabi: the Federal Cabinet reshuffle, the merger of two of Abu Dhabi’s main investment arms, Mubadala Development Company (Mubadala) and the International Petroleum Investment Company (IPIC) and most critically, a new CEO for the Abu Dhabi National Oil Company (ADNOC), who unvei-led his plan for transformative reform within the first hundred days.

With global E&P activity faltering (global rig count down by about 60 percent since late-2014), oil and gas companies are returning their attentions to the

Preface

UAE

petroleum Mecca of the Middle East, which re-presents 60 percent of global oil and gas reserves with an average lifting cost of USD 27 per barrel. As Halliburton SVP Ahmed Kenawi declared, “I am convinced that the last drop of oil globally will come from this region”. An oasis of calm in a hot (climactically as well as politically) region, the UAE is at once a critical geomarket in itself and also the ideal gateway to the most important oil and gas region in the world.

These changes pale against the UAE’s staggeringly ambitious goal to transition into a post-oil economy built on the twin pillars of energy and economic di-versification, as outlined in the UAE Vision 2021 and Abu Dhabi Economic Vision 2030. For now, an extremely successful clean energy initiative, spear-headed by Masdar, the Abu Dhabi Future Energy Company, and increasing emphasis on Emiratization (i.e. the cultivation of the local workforce) stand tes-tament to the UAE’s overarching ambition to con-vert its oil leadership to a true energy leadership.



SNAPSHOT IN FIGURES

ADNOC CRUDE OIL EXPORTS

Australia and New ZealandCrude oil exported(‘000 bbl) 15,597

Europe

Crude oil exported (‘000 bbl)

Refined products exported (‘000 tonnes)

Jet oil 2,032

3,054

North and South America



Jet oil 123

4,875

42Sulphur exported (‘000 tonnes)

Africa



Jet oil

LNG

Gas oil

Sulphur

332

40

240

1,401

5,045

Gas and sulphur exported (‘000 tonnes)

Sulphur exported (‘000 tonnes)

Asia



Naphtha

Jet oil

Gas oil

4,85036472

42

697,231

Source: Abu Dhabi Chamber of Commerce & Industry - Biannual Abu Dhabi Economic Report 2016 Q1, SCAD, IHS

Source: ADNOC - Sustainability Report 2014

USA

INDIA

CHINA

1.2

1.0

0.8

0.62008 2009 2010 2011 2012 2013 2014 2015

SINGAPORE

GERMANY

ABU DHABI

ECONOMIC PERFORMANCE INDEX



SNAPSHOT IN FIGURES

ABU DHABI’S TARGET REAL GDP

IN REAL 2005 USD BILLION (2005-2030T (*))

41% 41% 42% 44% 47% 49% 51% 54% 56% 60%57% 63%59% 64%

CAGR (%) Oil GDP

(*) T, hereinafter, refers to targeted years that fall within the scope of the Abu Dhabi Economic Vision 2030Source: Abu Dhabi Executive Council - Abu Dhabi Economic Vision 2030

2005

17.4%

59%

2006

25.2%

2008

4% 4% 4% 3% 3% 3% 2% 2% 2% 2% 2% 2%

2010 2012 201820162014 2020 2022 2024 20282025 2030

11.8%7%

7%

6%

415.7369.9310.6293.0

260.8232.1204.6

178.7156.1136.4119.1104.087.077.8

Non-Oil GDPGDP Deflator Inflation (%)

59% 58% 56% 53% 51% 49% 46% 44% 40%43% 37%41% 36%

6.7%

8.8%

4.5%

Pre-Vision Phase 1(2008-2013)

Norway’s non-oil share of GDP stood

at 82% in 2006

Phase 2(2014-2019)

Phase 3(2020-2030)

Source: Abu Dhabi Chamber of Commerce & Industry, IMF

Billion USD

Percentage of GDP

2014 20152013

110

82

54

27

0 20

30

40

50

ABU DHABI GOVERNMENT’S HYDROCARBON REVENUE



SNAPSHOT IN FIGURES

ADNOC CRUDE OIL EXPORTS

ADCO

· Operates 6 major onshore fields: Asab, Sahil, Shah, Bab, Bu Hasa, North East Bab fields (Al Dabbiya, Rumaitha and Shanayel)· The Bu Hasa field is one of the top twenty fields in the world in terms of proven reserves· Total concession area covers over 21,000 km2

· 2 export terminals: Jebel Dhanna Terminal and Fujairah Terminal.· Over 1,300 oil and gas wells.· Current oil production capacity of 1.4 million barrels of oil per day (bpd) with plans to increase to 1.8 million bpd by 2017, by initiating production from 3 new fields: Qusahwira, Mender an Bida A-Qemzan.

TAKREER

· Operates two oil refineries: - Abu Dhabi Refinery: located in Umm Al Nar, capacity of 80,000 barrels of oil per day. - Ruwais Refinery: capacity of 817,000 barrels of oil per day.

· Capacity at the Ruwais refinery increased in 2014 from 417,000 bpd to 837,000 bpd upon completion of the Ruwais Refinery Expansion (RRE) Project.

BOROUGE

· Operates 3 ethane crackers with a combined annual capacity of 3.6 million tonnes and 9 polyethylene and polypropylene plants with an annual manufacturing capacity of 4.5 million tonnes; all located in the Ruwais Industrial Complex.· Operates a compounding manufacturing plant in Shanghai, China. Currently being expanded from 50,000 tonnes to produce 90,000 tonnes of compounded polypropylene per year.

ADNOC DISTRIBUTION

· Operates 223 motor vehicle service stations across the UAE, and has taken over 75 petrol stations in the Northern Emirates.· Provides a range of services: - Storage and distribution of liquid fuels and LPG. - Lube oil and grease production and marketing. - Bunkering (marine) and aviation fueling. - Auto services. - Convenience stores.

ELIXIER

· Operates two facilities: - Ruwais Air Separation Plant: provides gaseous and liquefied nitrogen to Borouge via pipeline; liquefied nitrogen to ADNOC subsidiaries via tanker; and liquid oxygen to end users in the UAE. - Mirfa Nitrogen Plant: consists of two identical air separation trains to provide nitrogen (capacity of 670,000 Nm3/h) for injection into gas reservois located at Habshan.

GASCO

· Operates 3 desert plants for gas processing and natural gas liquids (NGL) extraction: Asab, Bu Hasa and Habshan / Bab complex (Bab has additional sour gas treatment facilities)· Operates an NGL Fractionation Plant in Ruwais.· Operates a pipeline distribution network to route natural gas to several industrial consumers.· Overseeing several major expansion projects, implementing new gas processing facilities and revamping existing ones.

(to ADGAS)

Al Hosn Gas

· Operates the Shah Gas Field (220 km south west of Abu Dhabi)· Complete facilities expected to be operational by 2015, with a sour gas production capacity of 1,000 million standard cubic feet per day (MMSCFD) over the field’s lifetime.

FERTIL

· Operates two Ammonia Plants and two Urea Plants in the Ruwais Industrial Complex: - Ammonia: total capacity 3,300 metric tonnes per day. - Urea: total capacity of 5,800 metric tonnes per day.

· Total Urea export of 1.9 million metric tonnes per day.

Nitrogen (Gas/Liquified)

Urea and Liquid Ammonia

Refined Products (Local Sales)Refined Products

SalesGas

End Users

Sales Gas

Ethylene, Polyethylene

Crude Oil

Jebel Dhanna Terminal

Fujairah Export Terminal

RuwaisTerminal

Network &Industrial

Consumers

Condensate &Natural Gas LiquidsAssociated

an non-associated

Gas

Hydrogen

and Prolypropylene Resins

ONSHORE

Sulphur



SNAPSHOT IN FIGURES

ADMA-OPCO

· Operates 2 offshore fields: - Umm Shaif: 360 km2 in size, located 150 km north-west of Abu Dhabi - Zaum: 1,270km2 in size, located 65 km north-west of Abu Dhabi

· Tha Zakum field is the second largest offshore field in the Gulf and the fourth largest field in the world. It contains five separate zones which make up Lower Zakum and Upper Zakum. Field development has been centred on the lower zones in view of their superior productivity.· 37 platforms 408 oil and gas well heads (some of which are shared with ZADCO)

ADGAS

· Operates a Liquified Natural Gas (LNG) Plant on Das Island (180 km north-west of Abu Dhabi) The LNG Plant is unique worldwide in its ability to process both associated gas, which is a by-product of oil extraction processes, and natural gas extracted as a free product from gas reservois.· Average annual production: 8 million tonnes of Liquified Natural Gas (LNG), Liquified Petroleum Gas (LPG), paraffinic naphtha and liquid sulphur.

Integrated GasDevelopment Project

Associated Gas

Associated Gas

CrudeOil

Zirku Island

Das Island

Flow of existing products

Flow of future products

Industrial terminal for processing, storage and export of products

Major projects

Crude Oil

Associated andNon-associatedGas

LNG, LPG, Praffinic Naphtha and Sulphur

ZADCO

· Operates 3 offshore fields: - Upper Zakum (UZ): 1,269 km2 in size, located 84 km north-west of Abu Dhabi. - Umm Al Dalkh (UA): 150km2 in size, located 25 km north-west of Abu Dhabi. - Satah (ST): 35 km2 in size, located 200 km north of Abu Dhabi.

· Oil operation centres on zirku Island (140 km north-west of Abu Dhabi)· Major expansion project underway at Upper Zakum. This project, known as Upper Zakum 750 (UZ750) aims to increas production from 600,000 bpd to 750,000 bpd by 2017.

(to GASCO)OFFSHORE

LEGEND

Source: ADNOC Sustainability Report 2014



LOOKING TO THE FUTURE

POST-OIL AMBITIONSH.E. Dr. Thani bin Ahmed Al Zeyoudi,Minister of Climate Change & Environment

EBR: Following the February 2016 Cabinet reshuffle, you were appointed Minister of the renamed Ministry of Climate Change and Environment. What mandate were you given? H.E. DR. THANI BIN AHMED AL ZEYOUDI (TBAAZ): The Cabinet reshuffle was fundamentally anchored in the UAE’s commitment to sustainable growth across all sectors. The establishment of the newly named Ministry of Climate Change and Environment is an impor-tant milestone which reflects the importance our leadership places on climate action.

The UAE is committed to moving away from a hydrocar-bon-based economy and transitioning into new knowled-ge-based industries. One of our new areas of focus will be the engagement of the private sector and academia, becau-se a focus on innovation, and research and development (R&D) is essential. We will be great champions for partner-ships which will allow the government, private sector and academic institutions to work hand in hand.

The defining characteristic of the UAE is that when we make a commitment, we always see it through. This exp-lains why the private sector sees the UAE government as one of the main drivers: we set the best practices and guidelines

so that the private sector can work with us to achieve the country´s goals.

EBR: What do you see as some of the primary chal-lenges when it comes to safeguarding the UAE’s leader-ship role in energy diversification?TBAAZ: We do have some particular challenges. The UAE is a country with scarce water supply. That said, I am proud that we have proactively taken the initiative to invest in tech-nologies suitable for our environment in order to address the challenge we are facing. Last November, the UAE’s first desal-ination plant that works on renewable energy was inaugurat-ed in Abu Dhabi. The project, which began in 2013, aims at producing 1,500 cubic meters of water daily and forms part of the UAE’s ambitious target to increase clean energy to 24

Preface: In an exclusive interview, Minister H.E. Dr. Thani bin Ahmed Al Zeyoudi discusses the UAE’s post-oil ambi-tions and the future role of the oil and gas industry.

H.E. DR. THANI BIN AHMED AL ZEYOUDI MINISTER OFCLIMATE CHANGE AND ENVIRONMENT

It is clear that the oil and gas industry plays a crucial role in developing the country’s human talent and supporting the wider economy.

“

“



POST-OIL AMBITIONSH.E. Dr. Thani bin Ahmed Al Zeyoudi,

Minister of Climate Change & Environment

percent of the national energy mix by 2021. While we know our petroleum resources can sustain us for at least another century, we have to think about our future. In the shorter term, we want to reduce our dependence on the volatile natu-ral resource market, which sees heavy price fluctuations that affect the stability of our economy.

Today, 70 percent of our GDP comes from the non-oil sector. We will continue our efforts to build an economy independent of oil market fluctuations.

EBR: While international expertise is crucial in the development of the UAE’s clean energy sector, what importance do you attach to Emiratization as part of the UAE´s green development?TBAAZ: Emiratization is at the heart of the UAE’s Vi-sion 2021. 1,600 jobs will be created through the country´s green growth strategy. Masdar achieved an Emiratization rate of 44 percent in 2015. This demonstrates that even in the more technical sectors, increasing the local workforce content is not only a priority but has been a reality. We also attach a lot of importance to empowering women, as we believe that they can act as leaders in the development of the UAE’s technical sectors. As part of the February reshu-ffle, the government appointed H.E. Shamma Al Mazrui,

who is just 22 years old, as Minister of State for Youth Affairs, highlighting the UAE leadership’s emphasis on youth development. Most impressively, the average age of the new ministers is 38.

The country´s focus on education is paramount. Internationally renowned universities, including the likes of NYU and the Sorbonne have been brought to the UAE. Locally, establishments such as Masdar Institute – which has partnered with MIT and Abu Dhabi’s Petroleum Institute – have played an important role in advancing the energy education sector.

We have a dedicated program for the youth as part of the Abu Dhabi Sustainability Week (ADSW), a ground-brea-king global forum that unites thought leaders, policy makers and investors to address the challenges of renewa-ble energy and sustainable development. ADSW helps to raise awareness in the UAE about the importance of sus-tainability and energy diversification.

EBR: What role do you think oil and gas companies can play in UAE´s energy diversification strategy?TBAAZ: Notably, at the leadership level, there is a lot of movement between the traditional and renewables sectors. I come from an oil and gas background. It is clear that the oil and gas industry plays a crucial role in developing the coun-try´s human talent and supporting the wider economy.

Looking at the International Oil Companies (IOCs), Total has played a key role in the development of the Shams-1 project, the largest concentrated solar power plant (CSP) in operation in the world and a major breakthrough for renewable energy in the Middle East. This shows that IOCs can play a major role in building the UAE´s energy future. Another flagship project is the Abu Dhabi Carbon Dioxide Capture and Storage Project, a joint venture between the Abu Dhabi National Oil Company (ADNOC) and Masdar. The project involves the capture of CO2 from the Emirates Steel factory in Abu Dhabi and its transportation to the ADNOC reservoirs for the purpose of enhanced oil recovery (EOR).

Ultimately, we see the IOCs as innovative solution pro-viders, contributing to best practices in the region and I am confident that the oil and gas industry will play a key role in achieving the UAE´s green growth strategy and Vision 2021.



STRIKING A BALANCE

THE UAE’S NEW ENERGY MIXH.E. Dr. Matar Al Neyadi,Undersecretary, Ministry of Energy.

EBR: How has the Ministry devel-oped in the past few years in terms of its mandate?MATAR NEYADI (MN): Since 2013, the Ministry of Energy has em-barked on an ambitious restructuring process to ensure it is more efficient and systematic in the way it operates. Our responsibilities have expanded with the renewed mandate given by the UAE Federal Government in 2016; we have become a more sophisticated en-tity in charge of the coordination and regulation of energy policy, as well as the entity responsible for representing the UAE energy sector across the world.

To achieve this, we have added key new functions and departments to support the Ministry in its responsi-bilities, such as the Regulation and Supervision department and the Energy Conservation and Efficiency department.

We have also developed new tools to serve the energy sector. For instance, in January 2016, we launched the Energy Balance, which is a key tool for reliably tracking the supply and consumption of energy in the UAE. This data is essen-tial for energy decision makers because it allows for the precise tracking of the performance of the energy sector, which is fundamentally important in energy policy planning.

EBR: In the February 2016 Cabi-net reshuffle, the water portfolio was moved from the Ministry of Environ-ment to the Ministry of Energy. What is the significance of this decision?MN: His Highness Sheikh Mohamedbin Zayed Al Nahyan, Crown Prince of

Preface: H.E. Dr. Matar Al Neyadi, Undersecretary at the UAE Ministry of Ener-gy, discusses the 2016 integration of the water portfolio under the Ministry of Energy, and the UAE’s energy mix strategy.

H.E. DR. MATAR AL NEYADI,UNDERSECRETARY AT THE UAE MINISTRY OF ENERGY



THE UAE’S NEW ENERGY MIXH.E. DR. Matar Al Neyadi,

Undersecretary, Ministry of Energy.

Abu Dhabi, has famously stated that water will more important than oil for the UAE´s future. In the UAE, we have scarce water natural resources and there-fore have to produce water using a wide array of energy-intensive technologies. This means that there is a unique nexus between energy and water in this coun-try, so linking them under the Ministry of Energy is the right approach.

EBR: The UAE is seeking to sig-nificantly increase oil and gas production, while also diversify-ing into nuclear and solar energy. What is the Ministry’s strategy re-garding the UAE’s energy mix?MN: The diversification of the en-ergy sector is a key component of the

UAE Vision 2021 to deliver a sustain-able environment and infrastructure. This will, firstly, bring more energy se-curity for the nation and, secondly, im-prove our environmental sustainability by saving millions of carbon dioxide (CO2) and other greenhouse gas (GHG) emissions per year, thereby preserving our natural resources. To achieve this, peaceful nuclear energy and renewables have both been selected as the right en-ergy technologies to power the UAE’s

growth. Together, they will contribute to an estimated 27 percent of electricity demand by 2021. The UAE was blessed with abundant natural resources but it had to develop an entire energy sector – to maximize every opportunity possible and ensure that the energy sector became an engine of growth. With the delivery of energy diversification, the UAE will po-sition itself not only as a regional leader in the Middle East but also as one of the most sustainable nations in the world.

H.E. DR. MATAR AL NEYADI UNDERSECRETARY AT THE UAE MINISTRY OF ENERGY

The diversification of the energy sector is a key component of the UAE Vision 2021 to deliver a sustainable environment and infrastructure.

“

“



STRAP IN HERE PLEASEStrap subhead in here please

ADNOC-LEDGING THE NEEDFOR CHANGE

ccording to 2014 data, the Abu Dhabi National Oil Company (ADNOC) is the 12th largest oil producer in the world, accounting for essentially all of the UAE’s output. A veritable conglomer-ate of 21 entities, parent company ADNOC acts

as a fully integrated holding company with a controlling stake (typically 60 percent) in the various subsidiaries, with the rest held by IOCs. In 2013, ADNOC announced it was increasing production to 3.5 million barrels per day (bpd) from 2.7 million. Despite crashing oil prices, it remains on an impressive track to achieve this target, with production in June 2016 reaching 3.15 million bpd.

Nevertheless, with ADNOC embodying the traditional role of an NOC as wealth generator for the country, con-tributing to 60 percent of the Federal budget and 30 per-cent of the UAE’s GDP, a dramatic shake-up was announced in February 2016, starting right from the top with H.E. Dr. Sultan Al Jaber announced as the new CEO. Within the first hundred days, the reshuffling of top-tier leader-ship commenced, most notably with previous Abu Dhabi Company for Onshore Petroleum Operations (ADCO) CEO Abdulmunim Al Kindi moving to Director of Exploration and Production at the parent company. This reflects ADNOC’s intention to streamline activities across its three main E&P entities – ADCO, the Abu Dhabi Marine Operating Company (ADMA-OPCO) and the Zakum

Development Company (ZADOC) – in pursuit of a more cohesive and efficient production strategy.

ADNOC’s relatively high performance compared to its peers can be attributed to its unique system of corporate gov-ernance, where it performs the twin functions of regulating the Abu Dhabi oil sector and governing one of the world’s largest oil companies. This has allowed for the absorption of foreign expertise and talent directly as technical and oper-ational personnel are installed within ADNOC alongside Emiratis. Nevertheless, it still remains worryingly dependent on IOCs, with the development of its own internal capabili-ties offset by the increasing complexity of its maturing fields.

The buzzword du jour was therefore very much ‘oper-ational efficiency’. While the full masterplan has yet to be unveiled, with some suggestion that ADNOC is keen to use its own Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC) in November as platform, some tan-talizing hints have been doled out.

Four strategic themes have been identified: performance, profitability, efficiency and people, all of which will buttress a new commercial mentality within the company.

H.E. Al Jaber sums up, “ADNOC must evolve into a more agile organization to main¬tain its competitive edge in today’s global economy. This will ensure ADNOC remains a core contributor to the UAE’s progress, future development and long-standing efforts to diversify the economy.”

KEY INITIATIVES

UPSTREAM: LEVERAGE GROUP POWER

DOWNSTREAM:SMARTER USE OF CRUDE

NEWCORPORATEBRANDING

PERFORMANCECONTRACTS FORSENIOREXECUTIVES

● Centralize procurement in parent company(e.g. mega tenders)

● Benchmarking practices based on bestindustry standards on criteria like operatincost per barrel

● Optimize inventory and working capital

● Replace flagship Murban(sold at a premium) with offshoreblended crude in refiningprocess

● Develop new refining products

A Technology that

CHALLENGES CONVENTIONRedefi ning how operators drill, complete, and produce wellsThrough the depth and breadth of our portfolio, we are continually adapting to changing needs of our customers and their economic realities. We have earned our position as a leading, multinational oilfi eld services provider, by delivering innovative technologies with an integrated approach to enable safe, more effi cient and cost-effective operations.

Discover our game-changing technologies at weatherford.com

DRILLING & FORMATION EVALUATIONWELL CONSTRUCTIONCOMPLETION & STIMULATIONPRODUCTION

OPERATIONAL EFFICIENCYNOC RESTRUCTURING




Technology that

CHALLENGES CONVENTIONRedefi ning how operators drill, complete, and produce wellsThrough the depth and breadth of our portfolio, we are continually adapting to changing needs of our customers and their economic realities. We have earned our position as a leading, multinational oilfi eld services provider, by delivering innovative technologies with an integrated approach to enable safe, more effi cient and cost-effective operations.

Discover our game-changing technologies at weatherford.com

DRILLING & FORMATION EVALUATIONWELL CONSTRUCTIONCOMPLETION & STIMULATIONPRODUCTION



NICHE TECHNOLOGYSonny Sola, NORDIC

FILLING THE GAPS

Preface: CEO and MD of NORDIC, the Norwegian Drilling and Intervention Company, Sonny Sola, discusses the inspiration behind the founding of NOR-DIC in the UAE, the niche technology – the world’s first hydraulic rotating coil – his company is offering and his perspective on the trajectory of the petroleum industry in the region.

EBR: As the founder, CEO and MD, can you tell us your inspira-tion for the founding of NORDIC?SONNY SOLA (SS): The gene-sis of NORDIC can be traced back to Rogaland Research, a public research institution in Stavanger, Norway, now called the International Research Institute of Stavanger (IRIS), where I spent two years on a project to de-velop a sliding friction-reduction technology, particularly intended for coil tubing operations in horizontal wells, funded by Statoil, Shell and ENI. When the technology was ready for commercialization, IRIS formed a company called Extended Reach Technology, which later became NORDIC.

The name change was as a result of a strategic overhaul; initially, we had wanted to be a technology develop-er and provider, with the intention of partnering with major interna-tional service companies. We quick-ly realized that it is very difficult to convince major international service

companies to test and use your new technology and inventions, no matter how innovative, so we became a ful-ly-fledged service company. Today, we provide a range of services and prod-ucts, from drilling and work over services, hydraulic snubbing services to coil tubing services with cement-ing and pumping – including well interventions.

EBR: What was the rationale be-hind setting up the company in the UAE, given your Norwegian back-ground and your extensive inter-national work experience?SS: My passion has always been developing new technologies and I do what is necessary to realize their potential. That is what brought me from the extreme cold of Alaska to the extreme heat of Dubai.

In the early 90s, companies started to use coiled tubing for drilling, but the increased size of this coiled tub-ing increased the fatigue that occurs during operation. To drill effectively,

larger sizes needed be used but they were also more expensive, so we had to find a way to reduce costs. By com-pletely redesigning the conventional design, we managed to prolong the life of the coil by approximately 400 percent, reducing cost by 75 percent.

Another related problem was that of sliding friction, which occurred with the introduction of horizontal wells in 1988. As the horizontal wells became longer, the friction affecting the conventional sliding coil placed a ceiling on the maximum possible reach in a horizontal well. Our solu-tion was to rotate the coil very slowly, at around 10 to 15 rpms in order to remove up to 80 percent of the slid-ing friction.

After we had successfully developed these new technologies, we encoun-tered the problem of finding wells for testing. Norway is not the best place for this kind of testing because the oil is offshore and the entire infra-structure is very expensive. Oil com-panies are reluctant to test any new



NICHE TECHNOLOGYSonny Sola, NORDIC

technology there because of the ele-vated financial risk. Our solution was to move to North America, because the production cost is much lower there. There are thousands of wells there, and they are onshore, which makes it easier for the testing of new technology. The patent for this technology, which had been held by Transocean, expired in 2014 and as a result, Nordic will develop the first coil tubing rotating unit in Dubai this year.

EBR: How do you think NOR-DIC’s – and your – Norwegian background has given the compa-ny an advantage in the very com-petitive landscape of the industry? SS: Being a company which originated in Norway does give us some advantages in this region. Norwegian technology has a rep-utation that precedes it– the only concern is that it may be expensive, but companies are always willing to listen to the idea. After that, it is

a matter of controlling the prices to suit the market.

This stems partly from the empha-sis Norway has put on the training and development of its workforce in the petroleum industry. In the past four decades, Norway went from knowing absolutely nothing to being the main supplier of premium tech-nology in the world, particularly in the subsea sector. I remember when I started working on rigs in 1977, the Norwegians were just assistants and it was Americans and Canadians who were in charge. It took less than a decade for Norwegians to grow into those positions and by 1990, there were barely any non-Norwegians left on the offshore rigs, having all been replaced by Norwegians educated and trained specifically for these positions.

That said, the disadvantage for Norway and Norwegian companies at the moment is that operations are very expensive. For instance, the average annual salary for an offshore worker across all positions is over

USD 100,000, and they only work 120 days a year. In the current price environment, it is not sustainable and Norwegian firms are struggling with this.

Hence, our position in the Middle East actually offers us these twin advantages.

EBR: How are you positioning NORDIC to meet the challenges you have identified in the indus-try here?SS: Every challenge is an oppor-tunity. We specialize in precisely the sort of technology that is increasing in popularity in this region. Our hy-draulic drilling and workover rigs are smaller, very quick and very easy to move – there is no need for any special moving equipment. They are also very easy to automate and very reliable. We have positioned ourselves in this niche precisely because we foresaw this trend. The recent drop in oil prices has simply accelerated that process.

SONNY SOLA CEO AND MD, NORDIC

My passion has always been developing new technologies and I do what is necessary to realize their potential. That is what brought me from the extreme cold of Alaska to the extreme heat of Dubai.

“

“



COVER STORYThe time is now

As one of the world’s top 10 oil and gas producers, the UAE

enjoys one tenth of global reserves, but the new reality of USD

50 a barrel has not left the Gulf petro-state entirely unscathed.

With a Federal Cabinet reshuffle and the appointment of a new

CEO for the Abu Dhabi National Oil Company (ADNOC), who

unveiled a plan outlining transformative reform, it is clear that

the UAE is seizing the opportunity of the oil price crash to thor-

oughly revamp itself.

In February 2015, in response to the prospect of oil running

out in the UAE in 50 years, Sheikh Mohammed, Crown Prince

of Abu Dhabi suggested, “if we are investing today in the right

sectors … we will celebrate at that moment” – an extraordinary

statement, no less because the UAE currently depends on oil

for around half of its GDP. With the country going all out to

convert its oil leadership to a true energy leadership, the time

is truly now.

Faltering global E&P activity has meanwhile pushed oil and gas

companies to return their attentions to petroleum Mecca: the

Middle East, which possesses 60 percent of global reserves and

an average onshore lifting cost of USD 27 per barrel, accord-

ing to compiled sources from International Energy Agency and

Morgan Stanley Equity Research. As Halliburton SVP Ahmed

Kenawi declares, “I am convinced that the last drop of oil glob-

ally will come from this region”. An oasis of calm in a hot region,

the UAE is at once a critical geo-market and the ideal gateway

to the most important oil and gas region in the world.

UAE

THE TIME IS NOW




INCREASING OPERATIONAL EFFICIENCY

Despite being in a region where high underground pres-sure forces crude oil to literally gush out of the ground, not even the UAE cannot afford to ignore the ‘new nor-mal’ of being fit for fifty. With the social compact of Gulf petro-states premised on the role of the state as the chief distributor of wealth, the International Monetary Fund (IMF) estimates the UAE’s breakeven price – needed to meet overall government expenditure – at USD 73. While the UAE has sufficient fiscal buffer to withstand USD 50 oil for nearly thirty decades, it also needs to contend with the various challenges of its maturing oilfields, most of which have been operational for decades. Little wonder, then, that new ADNOC CEO, H.E. Dr. Sultan Al Jaber, announced upon his appointment a program of mod-ernization and restructuring centered on the concept of ‘operational efficiency’ “to drive efficiency, performance

and profitability”. The ultimate goal, he declared, was to “ensure the ADNOC group remains a pillar of the UAE’s social and economic development for decades to come”. To this end, ADNOC “must evolve into a more agile organization to maintain its competitive edge in today’s global economy”. Key initiatives include the centraliza-tion of procurement in the parent company through the use of mega-tenders and the introduction of benchmark-ing practices based on industry best practices.

Furthermore, ADNOC remains committed to its 2013 plan to increase production from 2.8 million barrels per day (bpd) to 3.5 million bpd by 2018. With the low oil price grinding E&P activity to a temporary halt, ADNOC is counting on maximizing production from existing fields, having set the unprecedented target of achieving an Enhanced Oil Recovery (EOR) rate of 70 percent. Add to this ADNOC’s intention to raise offshore production from its current 40 percent share of total to 50 percent as well as their increased emphasis on sour gas through the Integrated Gas Development (IGD) project, technical challenges abound. These, the UAE is preparing to meet, with timely assistance from technology companies spe-cializing in EOR. Musabbeh Al Kaabi, CEO of Mubadala Petroleum admits, “we still need to address certain tech-nology gaps in EOR and unconventionals”, but points out that, due to their relationships with IOCs, they have “historically benefited from accelerated access to cut-ting-edge technologies and advanced know-how”. As CH2M SVP Joel Eacker highlights, however, the Middle East is always “looking at the bigger picture and are not overly focused on quarterly results. Consequently, clients are willing to spend money to invest in technological improvements”.

H.E. DR. SULTAN AL JABER

CEO, ADNOC

H.E. ENG. SUHAIL AL MAZROUEI

Minister of Energy

AHMED KENAWI

Senior Vice President, Halliburton

UAE

QATAR

K.S.A

IRAN

OMAN

El Buduq

Umm ShadABK Nasr

BelbazemMandous

Fabeh

Umm Al-DalkhZakum

GashaMubarrasUmm Lulu

Al-Dabb’iva

Abu Dhabi

Rumaitha

Sahil

Bab

Bu Hasa

Asab

Shah

UAE OILFIELDSSource: 2b1st Consulting




With stronger competition, compa-nies are scrambling to differentiate themselves in a crowded landscape, particularly as technologies and ser-vices become increasingly commo-ditized. Applus Velosi Regional Ma-nager Brian Dawes laments, “as with any service, older NDT technologies have become a commodity.” In line with increasing opex, asset integrity management services, which provide clients with accurate data on plant and equipment condition, are soaring in popularity. In response, Applus Ve-

losi has developed two proprietary technologies:

INCOTEST™ (an acronym for ‘Insu-lated Component TEST’) is a unique corrosion survey method that allows ferrous pipes and vessels to be surve-yed through thermal insulation under demanding circumstances. It essentia-lly provides a complete corrosion map of the metal structure and will identify any weak parts of the metal that require maintenance or repair, helping to pre-vent catastrophic failure in the pipeline.

New pipelines in oil and gas have long prefabricated sections that are welded end-to-end. RotoScan™ was developed for the inspection of girth welds during construction of long-dis-tance pipelines, both onshore and offs-hore. The RotoScan™ technology tests

the welding to make sure the weld inte-grity is up to standard. The advantage of RotoScan™ vis-à-vis conventional X-ray technologies is that it is done in real-time at high-speed, ensuring that projects stay on schedule.

In addition, he adds, “following the global merger between Velosi, the ins-pection and testing division of Applus Group, and RTD, the advanced NDT division, as well as the acquisition of NDT Technology in the UAE, we have introduced our own proprietary techno-logies to the UAE and the Middle East region, in addition to the full range of conventional certification, inspection and testing services.” For companies looking to stand out during these trou-bled times, in-house R&D and strate-gic M&A activity seem to be two solid strategies.

BRIAN DAWES,— Regional Manager,Applus+ Velosi

NEW TECHNOLOGY IS A PLUS

in the early 1990s starting with ‘huff and puff ’, then first gas injection pilots, horizontal wells and experi-mentation with selective injection production. When you aggregate these sorts of findings to Total’s overall knowledge and technolo-gy base derived from the company’s entire experiences round the world, I view the 70 percent target as highly achievable.” In the Emirati spirit of dreaming big, he adds, “why not even 80 percent one day?”

Service companies also see ample opportunity in the UAE’s stated targets. Amec Foster Wheeler Regional Operations Director Ross Gibson points out, “We have seen a reduction in capital expenditure (Capex) from our customers, which is very understandable. However, operating expenditure (Opex) has increased”. Industry estimates put total fall in E&P investment worldwide in excess of USD 400 billion. To meet clients’ Opex needs, companies are rolling out new service lines, as Expro VP

In a beleaguered global market, IOCs are understanda-bly eager to assist ADNOC – who controls 95 percent of the UAE’s oil and 92 percent of the UAE’s gas – in its goals to retain their participation in the UAE. BP President and GM (UAE) Abdulkarim Al Maazmi affirms, “BP has been investing in Abu Dhabi for about 75 years” and “is a leader in developing and deploying EOR techniques … to boost recovery from maturing fields.”

Total MD Hatem Nuseibeh has even bigger ambitions. “As development manager, we started the first EOR pilots

JOEL EACKER

Senior Vice President, CH2M

JOEL EACKER CH2M

[the Middle East is always] looking at the bigger picture and is not overly focused on quarterly results. Consequently, clients are willing to spend money to invest in technological improvements.

“

“




multi-product line, integrated solu-tions for customers”. Operational efficiency is also driving deeper structural changes: increas-ingly, clients prefer to have one company manage complex assets in full instead of relying on multiple

(MENA) Riccardo Muttoni outlines: “we recently launched four new busi-ness streams, including production optimisation and well abandonment, which ref lect the changing needs of our industry.” He stresses, “Our strategy is focused on delivering

consultants offering specialist services. In January 2016, Penspen was awarded a four-year PMC contract by the Abu Dhabi Marine Operating Company (ADMA-OPCO) for ongoing work on Das Island, the main industrial center of offshore oil and gas production.

ABDULKARIMAL MAAZMI

President and General Manager, BP

HATEMNUSEIBEH

President,Total

ROSS GIBSON AMEC FOSTER WHEELER

We have seen a reduction in capital expenditure (Capex) from our customers, which is very understandable. However, operating expenditure (Opex) has increased.

“

“




WEATHERING THE STORM

Given the importance of relations-hips in Arab culture, the UAE is not a place to make a quick buck; Emiratis want to see genuine com-mitment to the country. Weather-ford’s UAE office is one of its top ten affiliates with a huge market share of projects involving Direc-tional Drilling and LWD services, so it is little wonder that this Big Four company has sunk significant investment into the UAE. Moha-med Galal, Central MENA area director exults, “The importance of our operations in the UAE has grown over time and the UAE now serves as the hub for the region

because we are able to deliver equipment and support services for all our clients in the Eastern Hemisphere; which covers the Mi-ddle East, Africa and Asia-Pacific. Moreover, logistics ranging from visa processes, safe business prac-tices and the infrastructure of the seaports and airports in the UAE allow Weatherford to operate in a controlled environment.”

He explains their dual-Emira-tes strategy. “Our regional head-quarters are in Dubai while in Abu Dhabi we have three facilities in Mussafah, as well as our down-town office located close to our clients.” This is important becau-se Dubai has better transport links to the rest of the world while AD-NOC sits in Abu Dhabi – and cri-tically, any oil and gas company wishing to work in the sector must register an office in Abu Dhabi. To show investment and commit-

ment, “the company built three state-of-the-art facilities five years ago in ICAD, including our training center where we offer our emplo-yees and clients both technical and nontechnical training.”

Having a strong local presence also brings convenience and effi-ciency to companies. Galal elabo-rates, “These strategically built facilities allow Weatherford to fix and build tools locally instead of having to ship equipment back to Houston or the United Kingdom, resulting in faster services and turnaround time for our clients – which allows us to take on more projects.” Weatherford’s efforts have been recognized, most re-cently during the 2015 Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC), when they were awarded ‘Best Oilfield Services Company’ in the Interna-tional category.

not want to see a lost generation in this industry”. He adds, “we have been very careful to retain such a skill base, while still streamlining the organization [by] increasing the integration and skills transfer” between their teams in Norway, the UK, APAC, UAE and the Americas”. Jotun’s Regional Protective Sales Director Trevor Maughan adds, “innovation is neces-sary to survive and grow”, which is why “we have focused on continuous product innovation”. Involvement in major flag-ship infrastructure projects like the Burj Khalifa, the Burj Al Arab, the Dubai Metro and more recently, the Dubai Opera House, are testament to their success. CH2M’s motto rather sums it up: “global capabilities, local execution”.

AVOIDING THE CLASH OF CIVILIZATIONS

With falling activity in the Americas and the North Sea, oil and gas companies are refocusing on the Middle East.

MOHAMED GALAL— Central Mena area Director, Weatherford

Penspen SVP (Middle East and Asia-Pacific) Michael Simm explains, “this is [the new delivery] model that the UAE is increasingly turning towards, with a focus on obtaining bet-ter value from their oil resources”, which integrates opera-tions and integrity management more closely. CH2M SVP Eacker concludes, “the current downturn in oil prices means that service companies need to think strategi-cally and position themselves as solutions providers to our clients. My role is to imagine a future where the price of oil remains at USD 50 to 60 a barrel for the long-term”. The usu-al recourse is cost cutting and globally the industry has seen significant layoffs, with even ADNOC cutting almost ten per-cent of its workforce. While understandable, cost cutting is not a panacea and AGR CEO Svein Sollund cautions, “we do

SVEIN SOLLUND AGR

We do not want to see a lost generation in this industry. “

“




Hong Namkoong, Vice President & Managing Director at Samsung Eng ineer ing UA E , empha si z-es, “Since 2000, the Middle East has been Samsung Engineering’s primary market.” The multicul-tural and aggressively open envi-ronment of the UAE may pre-vent the worst of culture shock, but inter nat iona l compa n ies still need to adapt to the quirks and foibles of the industry there.

Archer Regional Director Sherif Refaat muses, “the Gulf is a very different environment from Europe … it is people-oriented as opposed to systems-orient-ed [so] the approach to training has to be different”, which explains Archer’s strong HR program. For Halliburton’s Ahmed Kenawi, employing locally is intuitive: “as an Egyptian, I have benefited from work-ing for Halliburton both in my country of origin, as well as in Houston and in the Middle East at large. I understand the culture of this region”.

HONGNAMKOONG,

Vice President and Managing Director, Samsung Engineering

However, working effectively in this region still requires a physical presence. The Emirate of Dubai, strategically placed at the crossroads of Europe, Africa and Asia, is the natural epicenter, with its aggres-sive openness to foreign investment, well-regulated legal environment and advanced infrastructure links. EXPRO’s Muttoni states, “Having regional headquar-ters in the UAE is critical in delivering our breadth of operations and continued growth. This country has strong manufacturing and logistical capabilities and

Courtesy of ADIPEC

ADIPEC 2015

RICARDO MUTTONI EXPRO

Having regional headquarters in the UAE is critical in delivering our breadth of operations and continued growth. This country has strong manufacturing and logistical capabilities and is a key hub from which to run our operations.

“

“




“we make things that make India proud”, they have been described by a former Indian finance minister as a ‘national company’ metaphorical-ly because of their unique position straddling the public and private sec-tor. CEO Sarma says, “as an Indian company, we are used to collabo-rating with national companies” so it was “a natural extension to us to work with the likes of ADNOC or Saudi Aramco in the Middle East”. This worked immensely in their favor, as “NOCs are the most important cli-ents in this region” and “while the IOCs and major oil companies are active in such markets, they are most-ly present as partners”.

January 2015, Total was awarded a 10 percent share in Abu Dhabi Company for Onshore Oil Operations (ADCO), which is responsible for over half of the Emirate’s production, beating out established rivals like Royal Dutch Shell and BP. Total’s MD Nuseibeh explains that this is the result of “a radical new arrangement” with “a whole new dimension to the concept of partnership”, involving “the cre-ation of a technology hub that will essentially connect ADCO to Total’s entire internal systems”.

For L&T Hydrocarbon Engineering, their knack for interacting with NOCs came about similarly through familiarity. With their slogan being

is a key hub from which to run our operations.”Another hurdle for IOCs is the need to cultivate strong relationships with NOCs, whose patronage – or lack thereof – decides the success of the company. This challenge is perhaps familiar for Total, whose defining challenge has always been the pauci-ty of home production, which is why they need to forge excellent working relationships with NOCs globally. This explains why Total has had a very successful incursion into the UAE, with involvement across the entire oil and gas value chain and even in other parts of the energy sector like desali-nation and solar power generation. In

WHEN FIRE AND ICE COMBINE

Norway and the UAE may not of-ten be mentioned in the same breath but remarkable parallels can be drawn between the two oil and gas giants, not least because the oil industry in both countries only started in the 1970s. Norwe-gian ambassador H.E. Jens Eikaas outlines, “the UAE has long since had an interest in Norway becau-se of the way that Norway has ma-naged its petroleum resources.” Statoil, the Norwegian IOC, begun as an NOC that had to rely hea-vily on IOCs for technology and expertise, but as Statoil VP Mi-ddle East Neri Askland explains,

“with contracts that included the condition that we would take over as operators after a certain number of years [to strike] a balance be-tween gaining the outside experti-se and experience we required and the domestic control necessary for our national plan.”

The UAE’s Emiratization program also echoes Norway’s attempt to introduce nationals into the pe-troleum industry. NORDIC CEO Sonny Sola applauds this initiative, but warns, “My only reservation is that this has to be well-managed. Local content rules need to be su-pplemented with education and a complete training infrastructure to ensure that demand of skilled labor is matched by supply.” Norway is seen as a global leader in EOR and subsea technology in part because they have developed rigorous trai-ning standards and best practices.

This is even more important, he ela-borates, because “the Middle East in general is exhibiting a marked regio-nal trend in shifting towards high-te-chnology automated drilling rigs that require skilled labour. With each well costing around USD 10 million, compa-nies understandably want a guarantee of the quality of their subcontractors.”

To help meet this critical need, NOR-DIC is in the process of setting up the Norwegian Well Intervention Aca-demy, to provide quality training in all aspects of well intervention. “We would like to export the Norwegian style standards and systems of edu-cation, training and certification to the UAE and to the region, in order to facilitate the regulation and for-malization of the industry here”, he declares. “This is a way for us to ca-pitalize on the potential here as well as to contribute our technology to the industry.”

SONNY SOLA— CEO and Managing Director,NORDIC




cultivating a local knowledge base. Emiratization is a crucial nation-al priority; while the UAE does not yet have the official local content requirements common in the region, Gary Graham, VP (MENA) of ABS Group reveals, “increasingly, a key per-formance indicator when it comes to the awarding of contracts is local work-force content”.

GARY GRAHAM

Vice President,ABS Group

SUBRAMANIANSARMA

CEO, L&T Hydrocarbon Engineering

LOCALIZING THE EMIRATI WAY

With Emiratis forming less than 10 percent of the total population, it is understandable that the oil and gas industry remains powered by IOCs

and employs only a small fraction of the local population. Historically, petroleum activity in the UAE pre-dates the country itself, with Iraq Petroleum Company (IPC) being the first exploration company to be established in 1936. In line with the UAE’s focus on sustainabili-ty and efficiency, however, signifi-cant efforts have been invested in

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Increasingly, a key performance indicator when it comes to the awarding of contracts is local workforce content.

“

“




Indian centers”. CH2M SVP Eacker expounds even further on this notion of corporate citizenry, exalting, “what sets us apart is that we are an employ-ee-owned company” and “we look to combine having the best people with an ethical, sustainable and long-term approach to business”.There is certainly no lack of poten-tial in the UAE. Nabil Al-Alawi, CEO of Al Mansoori, one of the largest and most well known local service providers in the region, said his motivation was precisely “to show that there is considerable talent and potential in this region, and that it is possible for a local company to develop and compete head to head with the largest international service companies.”

As there still remains a skills gap between Emiratis and expat workers, this poses a supply problem for IOCs that are keen to hire local talent. As a result, it has become increasingly common – and necessary – for com-panies to implement their own train-ing programs. Samsung Engineering, for instance, has offered the Samsung Engineering Internship Program (SEIP) in the UAE since 2010, “to

demonstrate our commitment to the UAE” and “contribute to the holis-tic development of the country”, according to VP and MD (UAE) Hong Namkoong. As L&T Hydrocarbon Engineering CEO Subramanian Sarma vows, “LTHE actively engag-es in development of local citizens through campus recruitments, skill development initiatives and sponsored training at its various

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“




OILING THE GEARS OF INNOVATION

Oil and gas reserves do not an ener-gy hub make; the top oil and gas ca-pitals of the world – Aberdeen, Sta-vanger, Houston and Perth – have all developed world-class ecosystems of research, development and in-novation. To add its name to that list, Abu Dhabi is investing lavishly on its R&D infrastructure and capa-bilities, with ADNOC championing efforts with its Petroleum Institute (PI), founded in 2001 on the model of the Colorado School of Mines. President Dr. Thomas Hochstettler emphasized, “Growing and deve-loping the PI’s research capabilities via partnerships is something that the school is consciously focusing on at the moment.” Currently, over 95 percent of externally sponso-red research projects are funded by the ADNOC Group of Compa-nies, with the remaining mainly by UAE government departments or national industries, the assumption being that ADNOC’s deep pockets will be a significant lure. Testament to its success is the fact that PI has engaged in collaborative research projects with top-tier international institutions like the Massachusetts Institute of Technology (MIT), Stan-

ford University and Imperial College in the UK.

But the UAE is also seeking a more substantial role in these partners-hips. Associate Provost and VP (Re-search) of the Masdar Institute of Science and Technology, Dr. Steven Griffiths looks towards Singapore as a key model: “I would like to en-courage more companies to base their R&D operations for the Middle East region here”. Hochstettler ad-mits that “traditionally, our research efforts have relied heavily on our collaborating partner-institutions for laboratory and technical support, but the inauguration of our new faci-lities, with over 8,000 square meters of laboratory space, will allow PI to participate as an equal player in the-se important collaborations.” The USD 90 million PI Research Center (PIRC) is set to open in November 2016.

The UAE is fertile ground for groun-dbreaking research, with no lack of technically complex challenges to tackle, most notably the issue of sour gas. PI has also been man-dated to contribute to an increase of five percent in Abu Dhabi’s EOR rate and, to this end, it has signed research agreements with compa-nies like Wintershall. In this way, Abu Dhabi hopes to water its innovation desert with not just oil money but topnotch research facilities and the draw of challenging problems.

DR. THOMASHOCHSTETTLER— President,PetroleumInstitute

BECOMING A TRUE ENERGY LEADER

Both vision and c o m m i t m e n t from the charac-teristically pres-cient leadership u n d e r p i n t h e UAE’ s a ggres -

sive pursuit of energy and economic diversification to realize their dream of a post-oil economy. The February 2016 Cabinet reshuffle saw a merger of the Ministry of Education and the Ministry of Higher Education and Scientific Research, the reallocation of the water portfolio to the Ministry of Energy and the expansion of the Ministry of Environment’s man-date to include Climate Change (and subsequent renaming as Ministry of Climate Change and Environment). Ministry of Energy Under-secretary H.E. Dr. Matar Al Neyadi says that this “was fundamentally anchored in the UAE’s commitment to sustainable growth across all sectors”.

Embracing energy’s multifaceted nature, the UAE is seeking to position itself at the vanguard of the clean energy revolution by capitalizing on synergies between the tradition-al and clean energy sectors. Energy leaders in the UAE often straddle both spheres comfortably ; most notably, ADNOC CEO H.E. Dr. Al Jaber started his career in Abu Dhabi Gas Industries Limited (GASCO) and led Mubadala’s Energy portfolio but was also instrumental in found-ing Masdar, where he served as CEO

until his appointment to ADNOC (he is now the chairman of Masdar) as well as the UAE’s Special Envoy for Energy and Climate Change to the UN.

Newly appointed Minister of Climate Change and Environment H.E. Dr. Thani Al Zeyoudi, himself from an oil and gas background, states, “we see the IOCs as innovative solution providers,

H.E. DR. MATARAL NEYADI

Undersecretary,Ministry of Energy




contributing to best practices in the region.” This reflects the global trend of increasing collaboration between the traditional and alternative ener-gy sectors. For instance, Total has diversified into solar power through its affiliate, SunPower, and is a key player on the Shams-1 project in Abu Dhabi, the largest concentrated solar power (CSP) plant in operation in the world. Masdar is working with ADNOC to develop commercial-scale projects for carbon capture, usage and storage, with the long-term vision being a national network that captures carbon from power genera-tion in order to use it for enhanced oil recovery (EOR), reducing the need to use valuable natural gas on EOR.

2016 marks the tenth anniver-sary of Masdar Clean Energy and Executive Director Bader Al Lamki makes it unequivocally clear that the UAE is serious about clean ener-gy. “As a major supplier of the world’s

energy needs, the UAE is committed to do its part in developing construc-tive approaches to combat the impact of climate change and to exemplify a leadership model in sustainable energy and economic development.” In the past decade, Masdar Clean Energy has been involved in a total of 1.7 gigawatts of clean energy pro-jects globally, including some of the world’s largest projects, like Shams-1 and the London Array in the UK, the world’s largest operational offshore wind farm, and plans to double

BADER AL LAMKI

Executive Director,Masdar Clean Energy

H.E. DR. THANIAL ZEYOUDI

Minister of Climate Changeand Environment

Source: Atlas Lens

Masdar city (artist’s interpretation)




this in the next f ive years . In 2009, the UAE b e c a m e t h e first developing country to host a major interna-tional organisa-tion, with Abu Dhabi becom-ing home to the

headquarters of the International Renewable Energy Agency (IRENA), testament to the UAE’s emerging role as a global energy leader, and in 2019, the UAE will also be the first OPEC member country to host the World Energy Congress.

IN IT FOR THE LONG HAUL

Despite the difficult times, the UAE continues to be one of the most exciting oil and gas markets today, and the stable political climate has

entrenched it as a great place to con-duct business, with the UAE being the top recipient of foreign direct investment (FDI) in the region. L&T Hydrocarbon Engineering Sarma’s last words of advice: “the nature of the oil and gas markets change over time, and you need [to be] responsive to developments, with a set of core values consistent with what the cus-tomer requires. Ultimately, depend-ability comes from good execution”.

The stability of the Emirati lead-ership and openness to the private sector has produced a generation of expats that has grown to see the UAE as home, and the UAE relies on them in large part to realize its dreams. Haven Fire & Safety MD Gerry Boux reminisces, “I came to the Middle East in 1981 and the UAE in 1982 and like many others I only planned of staying for a couple of years. It has now been over thirty years and counting. Not only have I raised a family here, my children are also raising their families here”.

GERRY BOUX

ManagingDirector, HavenFire & Safety

ABU DHABI’S OIL EXPORT REVENUES

2013 2014 2015

USD (Billions)Source: SAD, IHS @Abu Dhabi Chamber of Commerce & Industry

133.4 84.1 58.5




STRATEGICALLY INVESTING IN THE FUTURE

As all eyes turn to the UAE, the country is shrewdly exploiting its relatively strong posi-tion in this downturn to pursue countercyclical strategies. Flush with oil wealth, Abu Dhabi has created several in-

vestment arms, of which Abu Dhabi Investment Authority, one of the largest sovereign wealth funds in the world, is the largest and invests its USD 500 billion bounty only in non-oil industries. Another prominent example of the UAE’s astu-teness is the recently announced merger of Mubadala, the Abu Dhabi Development Company, with the International Petroleum Investment Company (IPIC), in order to consoli-date their portfolios, which exhibit some overlap.

Musabbeh Al Kaabi, CEO of Mubadala Petroleum, Mubada-la’s international E&P investment arm, has a dual strategy in this regard: the pursuit of strategic M&A opportunities and internationalization. Al Kaabi explains, “in terms of grow-

th, we have been proactive in identifying emergent merger and acquisition opportunities” but admits, “owing to the sheer market volatility that we are witnessing right now, it’s going to be extremely difficult to embark upon bold steps.” However, with low oil prices pushing M&A activity to one of its lowest levels in 2015, he confidently predicts, “we can expect there to be some attractive opportunities waiting to be grasped once a degree of oil price normality resumes”.

Mubadala Petroleum remains, interestingly, a somewhat hybrid company with IOC characteristics fused with a dis-tinctly NOC function, a significant set-up that enables it to retain the best of both worlds. As they are actively investing internationally, Al Kaabi elaborates, “we need to be com-petitive in terms of running our business [through] flexible decision making and decentralization”. Nevertheless, as a government-owned entity, we “are actively unlocking new opportunities that would be beyondthe reach of a purely private enterprise”, citing examples like the recent enhanced collaboration agreements they have signed with their Chinese and Mexican counterparts, Chinese National Petroleum Company (CNPC) and Pemex.

MUSABBEH ALKAABI— CEO,MubadalaPetroleum

Nordic is a provider of cost-effective and innovative solutions for specialized drilling, workover and thru-tubing intervention services.

Nordic discoveries consist of seeing what everyone has seen,but thinking what no one else has thought.

Mission:We adhere to a clear set of values that will drive our operating principles, business ambitions and are fundamental to the way we are working. Bio:NORDIC was formed in 2006 in the United Arab Emirates by a group of industry expects with extensive experience in the techniques of snubbing & work-over, coiled tubing and well intervention services - expertise that sets NORDIC apart from any other company in the Middle East region. Our highly motivated, experienced crews operate the most innovative snubbing & work over systems, coiled tubing units, fishing tools and thru-tubing tools available in the industry today - predominately built and developed by NORDIC.

NORDIC is one of the most experienced workover and well operation contractors in the region today. NORDIC employed a team of highly skilled equipment operators - considered the best in the industry - that have built Nordic’s reputation for quality service and safety.As an industry leader, Nordic has completed numerous jobs for major oil companies in the region.

T: +971 4 884 0604F: +9714 884 7704M: [email protected]

Nordic Energy ServicesDubai Investment Park 1Po Box 93086, DubaiUnited Arab Emirates



MARITIME TRADEMohamed Al Shamisi, Abu Dhabi Ports

FIRST PORT OF CALL

EBR: Abu Dhabi Ports was established in 2006, and since then, has shown impressive growth despite the global financial crisis in 2008. You have been heading Abu Dhabi Ports since 2013. What have been some of your key priorities since taking over leadership?MOHAMED AL SHAMISI (MAS): In the past decade, Abu Dhabi Ports has had an impressive growth trajectory, most notably sustaining double-digit growth since the 2008 financial crisis, a testament not only to our own strength but also to the strength and resilience of the economy of Abu Dhabi. We directly support the Abu Dhabi Economic Vision 2030.

Fundamentally, we are committed to a “One Port Strategy”, where all ports are working side by side to support the eco-nomy of Abu Dhabi. We consider ourselves to be maritime trade business enablers, and we take this both seriously and literally. We do not focus on factories or industries that do not require a major port to support their operations.

EBR: Abu Dhabi Ports has been a part of some of the most ambitious projects here in the UAE. What are the main factors contributing to their – and Abu Dhabi Ports’ overall – success?MAS: One of the biggest factors contributing to their suc-cess is the integration between Khalifa Port and Kizad, in what we believe to be a kind of ‘plug and play’ model, which is a huge benefit to our investors. We encourage our investors to go visit Khalifa Port and Kizad and see that the infrastruc-ture is already there, not just planned on paper.

We also offer large plots of land, and that’s valuable because not only is Abu Dhabi Ports growing fast, the whole country is. Many businesses once established cannot expand, which may require shifting to different locations. What we have pro-vided in Kizad is a place where all of their businesses and fac-tories can be consolidated in one location.

Another factor is the competitive utility costs, which are lower in Abu Dhabi, compared to the region, and also easier to access, thanks to the integration I mentioned earlier. Additionally, the deep water port can cater to all sizes of ships sailing the world today, greatly benefitting factories set up in Kizad.

The last point is that we offer lots of tailor-made options for our investors, in terms of lands, warehouses and offi-ces, we offer free zone and non-free zone solutions, bonded, non-bonded, covering all potential investors – small, medium and large.

EBR: Innovation is key to the continued success of Abu Dhabi Ports, evidenced by Maqta Gateway, which aims to be an innovative port community that will simplify the flow of information from all parties involved. What other types of innovations and technological advance-ments have been introduced for the continued growth of Abu Dhabi Ports?MAS: We invest heavily in technology, Khalifa Port being

Preface: Captain Mohamed Al Shamisi, CEO of Abu Dha-bi Ports, discusses his ‘One Port Strategy’ for Abu Dhabi Ports; their fundamental goal to be the best ‘maritime trade enablers’; and examples of their continuing commitment to developing innovative solutions to meet clients’ needs.

MOHAMED AL SHAMISI

CEO, Abu Dhabi Ports



the most advanced in terms of automation, not only in our region, but across Africa and the Indian subcontinent.

However, it is not simply about automation in the termi-nal, it is about creating a chain of automation. That is why we are investing in Maqta Gateway, which is an umbrella under which many systems function, including customs, food control, terminal operators, marine service operators, shipping lines, freight forwarders and logistic companies. All of these automated systems will then be integrated into one overarching system, the Maqta Gateway, a single platform through which clients can access all of the services.

Additionally, we are advancing the systems in our ports. For instance, the Vessel Tracking System (VTS) has been cen-tralized in Khalifa port to cover all ports across Abu Dhabi. Usually, each port operates its own VTS; but through our investment, we have centralized all of the ports into one loca-tion, which creates a single point of contact. This is beneficial not only to investors but also to us in terms of management implication.

Another example of innovation is what we have named the hot metal corridor, which enables the transport of aluminum in a molten liquid form from Emirates Global Aluminum to the mid and downstream aluminum industries. This saves energy because there is no need to cool the aluminum for transport and then reheat it afterwards.

We have also innovated our ways to better cater to the

needs of the oil and gas industry. For instance, we have devel-oped what we call a modular path to deal with the mainte-nance and fabrication of oversized pieces. This has always been a challenge. Our innovations have now enabled the transfer of oversized pieces or units from Kizad all the way to the ports, without any height restriction.

EBR: What is your personal vision for Abu Dhabi Ports?Simply put: we want to be the best, providing the best servi-

ces to our clients. We continually benchmark our operations against the best in the world, across the wide spectrum of activities and industries we manage: industrial zones, free zones, marine services, the ports, as well as maintenance of the buoys and beacons in Abu Dhabi and beyond.MAS: We will always strive to be the best maritime trade enablers. We have undoubtedly been very successful, but we will continue to build upon this success.

MOHAMED AL SHAMISI CEO, ABU DHABI PORTS

[Khalifa] is the most advanced [port] in terms of automation, not only inour region, but across Africa and the Indian subcontinent.

““

MARITIME TRADEMohamed Al Shamisi, Abu Dhabi Ports



NEW FRONTIERSMoving Offshore

ntil recently, with no lack of abundant, onshore fields, Abu Dhabi has been able to ignore complex fields and sit back as oil money poured in. More than four decades in, however, the low-hanging fruit have been picked and ADNOC can no longer

ignore more complex fields, especially as it seeks to increase production to 3.5 million barrels per day (bpd) by 2018. Without the technical expertise or experience to manage complex offshore fields, some of which contain sour gas, the UAE will need significant assistance from IOCs.

Overseen by the Abu Dhabi Marine Operating Company (ADMA-OPCO) and the Zakum Development Company (ZADCO), offshore currently contributes 40 percent of the UAE’s total production, with ADNOC having committed USD 25 billion to boost this to half. Even more exciting-ly, ADMA-OPCO’s concessions are scheduled for renew-al in 2018, and already IOCs are jostling for a shot at the 650,000 bpd production. The field that ZADCO runs, the Zakum field, is one of the world’s largest but there is little opportunity there for E&P companies in the short-term as existing concessions only expire in 2041. It is not just E&P players who stand to gain, however – Abu Dhabi has nota-bly used artificial islands for some of its offshore E&P, and this presents ample opportunities for EPC players.

In line with industry trends, the UAE has largely seen gas as an afterthought. Even when the country began to exploit its associated gas in 1973 with the establishment of the Abu Dhabi Gas Liquefaction Company (ADGAS), it has been unable to keep up with increasing domestic demand; nat-ural gas is used to generate essentially all of the UAE’s elec-tricity. Associated gas is also used to repressure the matur-ing oilfields, further straining supply. This confluence of factors saw the UAE lose its gas exporter status in 2008. Currently, ADGAS receives and processes associated gas from ADMA-OPCO’s offshore operations, with gas pro-cessing and liquefaction plants on Das Island.

U

SWEETENING THE OFFSHORE DEAL

With the success of Al Hosn Gas – the largest sour gas facility of its kind in the region – which reached peak production of one billion cubic feet per day (cfpd) of raw gas in 2015, ADNOC unveiled an Integrated Gas Master Plan in the Western Region of Abu Dhabi to explore off-shore sour gas fields.

Finally, ADNOC is not ignoring the demand side of the equation and it also assesses the use of innovative technologies and alternative methods, such as carbon capture, usage and storage, that will enable it to improve efficiency, optimize their own consumption, and liberate some gas. Here, again, technology providers should posi-tion themselves strategically.



FIRE SAFETYGerry Boux, Haven Fire & Safety

EBR: You founded Haven Fire & Safety in 1997. Can you give us an overview of the company’s journey in the past two decades?GERRY BOUX (GB): In the early days, we were focused on marine and offshore services, before gradually expanding into system engineering and supply. First, it was by working with principal companies like Ansul, who were actually our first major product supplier. Subsequently, we expanded fur-ther by adding complementary fire suppression and detec-tion systems. Now we have a whole range of products from top-quality overseas companies.

When the company started in 1997, it only had twelve employees. Currently we employ over 100 permanent staff and have established branches throughout the Emirates.

EBR: In this difficult climate, and as a niche company, it is important to differentiate yourself from your com-petitors. What strengths would you like to highlight in Haven Fire?GB: As a leading fire-protection, engineering, sup-ply and service company, we pride ourselves on offering a “one-stop shop” for our clients’ system solutions and equipment needs. I can say with confidence that the range and quality of our activities are unmatched and we have an excellent reputation for successful completion of pro-jects, no matter how large or complex.

A SAFE HAVENPreface: Managing Director of Haven Fire & Safety, Gerry Boux, discusses his company’s steady growth, the core principles at the heart of Haven’s operations, the importance of the UAE as a regional hub, and his personal commitment to the country.

We tend to work to the US distribution model, which is that we provide full local engineering, management and support for our principal’s products and system solu-tions as an exclusive distributor and they in turn provide us with the requisite ongoing training and equipment. In this way we maintain our independence.

One of the first things we learnt as a small company starting out was that we had to be self-sufficient. We learnt not to rely on subcontractors or anyone else to help when one of the rigs or tankers under our manage-ment ran into problems. Everything had to be available and completed in-house. Hence, we made self-sufficiency one of our business’s core tenets. As a result, we currently retain an excellent engineering team and we carry out our own engineering in-house.

Secondly, our goal has always been to work with the best possible suppliers of the highest quality products that we can find. We have a whole range of products from top-quality overseas companies.

Thirdly, the fact that we began in the oil and gas industry, providing offshore and marine services meant that we were already used to operating to very stringent standards and documentation requirements, given the required fire response efficiency. We feel that this has definitely given us an edge over our competitors that work exclusively in the commercial sectors.




Ultimately, it comes back to our core philosophy. We lis-ten to our clients, who are leading players in the industry. We then provide tailor-made solutions that really meet their specifications and we ensure that these solutions are cost-ef-fective for them over the entire lifetime of their projects.

EBR: Given your international presence, how impor-tant is having the UAE as a base?GB: Our business in the UAE represents the majority of our revenues. We work with major international companies and we act as a local partner for them.

However, we have many operations in the Gulf region as well as internationally that are run from the UAE. For instance, we have worked in Nigeria, Ghana, Oman, Egypt and Korea, among others. These projects occur main-ly through connections with clients that we find in the Emirates, who may then require help with projects outside the UAE. As we are trained and approved by global leading manufacturers, we are well positioned to be able to support installations and projects all over the world.

One example is power generation companies, to whom we provide fire and safety solutions for their temporary power solutions. These companies have their bases in the UAE but we could end up sending engineers with them to anywhere in the world. For instance, we recently carried out a project in

Panama and another one in East Africa, in order to support our principals.

EBR: Given the dire straits the industry is currently in, what is your strategy for maintaining Haven Fire’s re-cord of steady growth?GB: Although oil prices are down and the industry is facingtough times, what is important to remember is that the oil and gas industry is one in which fire safety is of paramount importance, not least because of the magnitude of potential disasters and the exorbitant costs attached to any disruption in normal operations. Fire and safety systems are indispensa-ble to the continued safe functioning of the industry.

Particularly in the current cost-cutting environment where companies are beginning to cut down on staffing and oth-er operating costs, they sometimes do not renew equipment as often. With increased wear and tear on equipment and systems, the importance of having excellent fire and safe-ty systems as a fail-safe measure increases significantly. Compromising on fire safety can lead to tragic consequences.

Our strategy in response to this current oil price crisis is simply to increase our efficiency. We stand by our philoso-phy of providing high-end, high-quality products. This is a principle we are committed to explaining to our customers: a quality solution is cost-effective over the long term once

GERRY BOUX MANAGING DIRECTOR, HAVEN FIRE & SAFETY

Although oil prices are down and the industry is facing tough times, what is important to remember is that the oil and gas industry is one in which fire safety is of paramount importance.

“

“




Haven Fire and Safety is a leading Fire Protection,Engineering, Supply and Service Company.Our reputation is second to none and we are committed to all aspects of quality and customer satisfaction.A wide customer base is covered in all major market sectors, with representation in key areas throughoutthe Arabian Gulf.

Address: P.O.Box 33347DubaiT: +971 4 347 1999

P.O.Box 9554,Abu DhabiT: +971 2 554 7940

M: [email protected]: http://www.haven�re.com

A 'one stop shop' for system solutions and equipment needs, providing the complete package from design through to installation, commissioning and service.

you take into account its stability and reliability. For instance, it is not really cost effective to reduce the initial out-lay if this involves cutting corners, as this would result in loss of reliability and associated higher lifetime costs for rework and increased maintenance demand.

We have an unparalleled HSE record. The current challenge is to explain this notion of value to our customers, who are understandably worried about their bottom-lines. We are committed to assisting them as much as possible with this by increasing our efficiency, not sacrificing on quality.



STRIVING FOR PERFECTION

PERFORMANCE OPTIMIZATIONDavid Mullen, Shelf Drilling

Preface: Shelf Drilling´s CEO, David Mullen, discusses how their focus on “Perfect Execution” has helped to differentiate them and redefined the industry’s standards of success.

EBR: Shelf Drilling began with the 2012 acquisi-tion of 37 jack-up drilling rigs and one swamp barge from Transocean. What have been its key milestones?GERRY BOUX (GB): A key milestone was achieving independence from the seller organization in what was an immensely complicated business carve-out transaction. Since then, we have consistently produced the best-in-class operating performance. In 2015, our total record-able incident rate (TRIR) was 0.22 versus the industry average of 0.6. Our lost time injury rate (LTIR) was 0.0. Uptime performance is averaging 99 percent, with almost all service projects completed on time and within their prescribed budgets.

In addition to our industry-leading contracted back-log, we have also had three years of solid financial perfor-mance. We grew EBITDA from less than USD 200 million when we acquired the business to USD 460 million in the first year alone.

I am also very proud that we have managed to build a strong, motivated workforce, with an extremely strong performance culture. This is in large part due to the fact that our rig employees felt that they were working at aplace that values their work.

EBR: In such a competitive landscape, what differ-entiates Shelf Drilling from other rig contractors?GB: Safety and uptime are the primary industry key performance indicators, but with our current standards, there is not that much room for us to improve! This has pushed us to look at the other key aspect of perfor-mance: well delivery, and we are pursuing what we call ‘Perfect Execution’.

David MullenSHELF DRILLING



PERFORMANCE OPTIMIZATIONDavid Mullen, Shelf Drilling

The ultimate goal for E&P compa-nies, especially in today’s econom-ic environment, is to drill and com-plete a well in a smaller time frame without compromising quality or any other goals. This is something many drilling contractors have no vested interest in optimizing, because, in a way, it means creating less work for the future. But the right way to think about this is that we are creat-ing huge value for our clients, which brings repeat business.

For example, with one of our major clients in South East Asia, we helped them average drilling a 12 thousand foot deviated well in just 5.7 days, by optimizing rig operations and design. For instance, during well drilling operations, there are many flat spots that interrupt normal drilling, when we have to do logging and run casing, among other things. We worked on how to take many of these activities off the critical path. As an example, our rigs were modified so that when we are drilling in one well bore, we are logging in another, instead of doing them sequentially. This saves a lot of time and money.

Compared to the industry average globally, which is probably around 45-60 days, 5.7 days is simply phe-nomenal. We are in discussion with an operator here in the Middle East, who wants us to undertake similar operations.

We are also open to the idea of performance-based contracts rath-er than straight, day-rate contracts. Ultimately, we are distinguishing our-selves by redefining industry stand-ards in terms of performance.

DAVID MULLEN CEO, SHELF DRILLING

“

“ Ultimately, we are distinguishing ourselves by redefining industry standards in terms of performance.



ENERGYSYNERGIES

RENEWABLESBadar Al Lamki, Masdar Clean Energy

EBR: Can you provide an over-view of Masdar Clean Energy for our international audience?BADER AL LAMKI (BAL): Masdar Clean Energy is one of the business units within Masdar (also known as the Abu Dhabi Future Energy Company), Abu Dhabi’s pioneering renewable energy initiative. This year, we are cele-brating our tenth anniversary, and I am pleased to say that we have managed to translate an ambitious vision into tan-gible achievements, both domestically and globally.

Today, we have 1.7 gigawatts of clean energy projects either deployed or under development. Within the UAE, we have flagship projects like the Shams-1 project in the Western Region of Abu Dhabi, which powers over 20,000 homes. Internationally, we are involved in some of the world’s larg-est clean energy initiatives, such as the London Array in the UK, the world’s largest offshore wind farm currently in operation.

Our ambition is to at least double our current output – about 1 gigawatt from wind and the rest from solar – over the next five years.

With a solid decade of operational experience, we have accumulated significant expertise in all opera-tional elements, from environmen-tal studies and topography studies to financing and business devel-opment. This means that we have impressive credentials as a develop-er with a great track record of suc-cessful project delivery and manage-ment in many different countries. This is what makes us extremely credible to our clients.

Preface: Bader Al Lamki, Executive Director of Masdar Clean Energy, discus-ses Masdar’s impressive decade-long record of successful renewable project development, both in the UAE and internationally, the economic viability of the renewable sector, and the synergies that can be exploited between the traditional and renewable energy sectors.

BADER AL LAMKI

Executive Director, Masdar Clean Energy



RENEWABLESBadar Al Lamki, Masdar Clean Energy

EBR: The conventional view of renewables is that they are not eco-nomically viable. What explains the UAE’s successful investment in re-newable energy?BAL: I want to emphasize that Masdar Clean Energy is a for-profit institution. We take on renewable pro-jects with the clear intent of making a return on our investment. This reflects our fundamental belief that this sector is only sustainable if it is economically viable. This belief also drives contin-

uous learning and development and maintains our competitive edge. For instance, we were delighted to be part of the winning consortium to complete the third, 800MW, phase of the Sheikh Mohammed bin Rashid Al Maktoum Solar Park in Dubai; not only was the USD 0.0299/kWh the lowest bit for solar photovoltaic (PV) power global-ly, it also makes solar power more than competitive with oil and gas.

The prevailing view of the renewables sector used to be that it was simply a

way of mitigating climate change. Now it is increasingly seen as a robust indus-try in its own right, generating employ-ment, driving R&D and technologi-cal advancement, and stimulating the economy. As an indispensable element of the energy mix, it also has a critical role in ensuring energy security: once the infrastructure and capacity is built, it generates a stable supply of energy that hedges against the inherent volatil-ity and price fluctuations of the oil and gas market.

BADER AL LAMKI EXECUTIVE DIRECTOR, MASDAR CLEAN ENERGY

We take on renewable projects with the clear intent of making a return on our investment.This reflects our fundamental belief that this sector is only sustainable if it is economically viable.

““



INDEXIncluding list of advertisers

COMPANY NAME PAGE #

Advertisers

ABS Group 25

Abu Dhabi Ports 32, 33

ADCO 8, 14, 24

ADGAS 8, 9, 34

ADMA-OPCO 9, 14, 21, 34

ADNOC 2, 5, 6, 8, 11, 14, 18, 19, 20,

22, 24, 27, 28, 34

AGR 22

Al Mansoori 27

Amec Foster Wheeler 20, 21

Applus+ Velosi 20, 28

Archer 23

BP 2, 20, 21, 24

CH2M 19, 20, 22, 26

Expro 20, 21, 23, 26

Halliburton 5, 18, 19, 23

Haven Fire & Safety 29, 36, 37

Jotun 22

L&T Hydrocarbon Engineering 24, 25, 26, 29

Masdar 5, 11, 27, 28, 40, 41

Ministry of Climate Change

and Environment 2, 10, 27, 28

Ministry of Energy 2, 12, 13, 19, 27

Mubadala Petroleum 2, 5, 19, 25, 27, 30

NORDIC 16, 17, 24, 30

Penspen 21

The Petroleum Institute 11, 21, 27

Samsung Engineering 23, 26

Shelf Drilling 38, 39

Total 2, 11, 20, 21, 24, 28

Weatherford 15, 22

ZADCO 19, 34




Photo © cover: Sheikh Zayed Grand Mosque: Entrance Chandelier. Flickr: Andrew MoorePhoto © page 2: Fountain in Dubai Mall. Flickr: Serge Bystro.Photo © page 4: Burj Khalifa # 04. Flickr: Daniel Zimmermann.Photo © page 10-11: Etihad Towers, Abu Dhabi. Flickr: Giles Messian.Photo © page 12-13: Sheikh Zayed Grand Mosque: Colonade and Reflecting Pool. Flickr: Andrew Moore.Photo © page 32-33: Dubai Skyline. Flickr: ADTeasdalePhoto © page 34: Etihad Towers. Flickr: Anastasia BasanoPhoto © page 38: Burj Al Arab interior. Flickr: keenhenryPhoto © page 40: Abu Dhabi 121. Flickr: Kyle TaylorCover story illustration ©: Miriam León


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