CCBLA - Arab-Belgium-Luxemburg Chamber of Commerce - ABLCC

Economic News

Airport development in Oman

The recently published Business Directory of the ABLCC presents most unfortunately some inaccurate data on the developments taking place at the Omani airports. Seeb International Airport is now indeed called the Muscat International Airport and the first phase of an ambitious plan to expand and modernise the facility will increase the handling capacity to 12 million passengers is expected to be completed by 2014.

The project program is to have the new control tower and second runway completed and operational by the end of 2013, and the passenger terminal and other buildings by the end of 2014. Further expansions planned in three subsequent phases will ultimately bring the airport’s capacity to 48 million passengers by 2050.

The development of Salalah Airport envisages an expansion of capacity to 1 million passengers by 2013.

Hydrocarbon reserves in the Arab countries

Although they pumped in excess of eight billion barrels of oil through 2009, the Arab countries boosted their proven crude wealth to nearly 683.6 billion barrels at the end of the year from 680.7 billion barrels at the end of 2008, according to the 2010 statistical report of the Kuwaiti-based OAPEC (Organisation of Arab Petroleum Exporting Countries).

Most of the increase came from Libya, which reported a reserve growth of nearly 2.3 billion barrels, while the rest was recorded in Saudi Arabia, already the world’s top crude exporter and largest reservoir of oil.

Saudi Arabia’s oil wealth edged up from around 264.1 billion to 264.6 billion while that of Iraq and Kuwait remained at 115 billion and 101.5 billion barrels.

Libya’s oil deposits grew from around 44.3 billion to 46.6 billion barrels while those of Qatar and Algeria maintained their level of 25.4 billion and 12.2 billion barrels respectively, according to OAPEC.

The UAE’s extractable oil resources remained almost unchanged at 97.8 billion at the end of 2009, the largest in the Arab world after those of Saudi Arabia, Kuwait and Iraq.

The reserves at the end of 2009 were put at 5.5 billion barrels in Oman, five billion barrels in Sudan, 4.4 billion in Egypt, around three billion in Yemen, 2.3 billion in Syria, 400 million in Tunisia and 100 million in Bahrain.

The report showed Saudi Arabia controlled 22.4 per cent of the world’s proven oil resources of 1,176 billion barrels at the end of 2009. Iraq held about 9.7 per cent while the reserves of Kuwait and the UAE accounted for nearly 8.6 and 8.3 per cent respectively.

As for natural gas, total Arab reserves rose from around 54,216 billion cubic metres (bcm) at the end of 2008 to 54,475 bcm at the end of 2009.

Qatar’s gas wealth slipped slightly from around 25,466 bcm to 25,366 bcm. Saudi Arabia had the second largest gas reserves in the region, standing at 7,920 bcm at the end of 2009, slightly higher than the 2008 level of 7,370 bcm.

The UAE controlled the Arab world’s third largest gas deposits of around 6,091 bcm, unchanged from their 2008 level. Algeria’s reserves of 4,501 bcm were the fourth largest while they stood at 3,170 bcm in Iraq, 2,138 bcm in Egypt, around 1,784 bcm in Kuwait, 1,549 bcm in Libya and 950 bcm in Oman.

The report shows Qatar controls 13.35 per cent of the world’s total proven natural gas resources of 187,158 bcm at the end of 2009. Saudi Arabia had 4.23 per cent while the UAE, Algeria and Iraq accounted for 3.25, 2.41 and 1.69 per cent respectively.

The report noted that the Arab countries’ oil and gas production does not match their massive resources as it accounted for around 27.5 and 13.4 per cent of the world’s total oil and gas output respectively.

“Arab oil production stood at around 23.7 million barrels per day and gas production at nearly 392 billion cubic metres in 2009…this shows that the oil and gas output in the region is low compared with the massive resources.”

The report notes that Arab crude resources have steadily increased over the past years despite their massive cumulative production, estimated at 310 billion barrels. OAPEC estimates that the Arab world’s crude oil deposits in place are much higher than the proven resources if new technology is introduced in the future.

“Assuming an extraction rate of 35 per cent, the Arab oil deposits in place could reach 2,738 billion barrels. This means the oil quantities that cannot be extracted by present technology are around 1,809 billion barrels, which are nearly 645 billion barrels above the world’s proven oil resources….these quantities, if they can be extracted, will meet the world needs for 60 years …even if only 10 per cent of them could be extracted, they could be enough for seven years.”

The report showed four Gulf countries—the UAE, Saudi Arabia, Kuwait and Iraq—controlled around 50 per cent of the world’s recoverable oil potential and more than 86 per cent of the total Arab crude reserves.

But it noted large quantities of oil and gas remained undiscovered or undeveloped in the region, totalling around 175 billion barrels of oil, 43,368 billion cubic metres of natural gas and 67 billion barrels of gas liquids.

Private sector involvement in Syria’s electricity sector

The Syrian government ahs agreed to open the way for the private sector to work in the electricity sector, including the building and operation of new power stations. According to the official news agency, the cabinet agreed to contract with the private sector according to the BOT formulae. Syria suffers from a decrease in the production of electricity, leading to frequent power cuts. The country needs to invest approximately one billion euros to address this situation.

The country produces between 5,500 and 6,200 MW per day. Electricity demand is estimated to grow at between 7 and 10% annually.

1961 – 2011 : The Golden Jubilee of the Independence of the State of Kuwait

The State of Kuwait starts the year 2011 with national celebrations on the occasion of the 50th anniversary of the independence of State of Kuwait in February. The Golden Jubilee is to highlight the laying of the foundations of the modern state and the enormous advancement of the Kuwaiti society, pushing the country towards development, progress and construction in line with international developments.

During the span of fifty years, Kuwait has witnessed some important and critical events which have shaped the modern history of Kuwait at various levels. On June 19, 1961, the Phase of State of Institutions started, which was laid down by Sheikh Abdullah Al-Salim Al-Sabah (1950-1965), as Kuwait became an independent state with full sovereignty governed by a constitutional system. During this phase, Kuwait witnessed a civilization renaissance including building the infrastructure and, most prominently, the drafting of the constitution and creation of the first parliament.

In the Phase of Prosperity during the Sheikh Sabah Al-Salim Al-Sabah (1965-1977) era, the renaissance took fast steps in political, economic, cultural, educational and industrial fields, as witnessed with the establishment of Kuwait University, the first university in the country. Sheikh Sabah thus complemented the role of his predecessor with achievements and developments. Thereafter, the country entered the phase of Modern Renaissance, the foundations of which were laid down by Sheikh Jaber Al-Ahmad Al-Sabah, leader of liberation and reconstruction, along with his right hand man, the Father Amir Sheikh Sa’ad Al-Abdullah Al-Sabah, whose great role and efforts during the occupation of the State of Kuwait by Saddam Hussein regime are well remembered. After him came His Highness Amir Sheikh Sabah Al-Ahmad Al-Sabah (2006), who complemented the blessed progress with his political and economic vision to make Kuwait a financial and economic hub.