Dania Saadi
In an exclusive interview with The National, Suhail Al Mazrouei, the UAE Energy Minister, tells us by email that lower oil prices will not hold back critical investment into the sector.
What is the effect of the recent slide in oil prices on the UAE’s oil industry?
The oil and gas industry in the UAE is well developed, and as a mature producer we are not going to change our plans due to price fluctuation. We have dealt with such fluctuation in the past and we will not panic this time. There is a world demand increase on crude oil and especially our crude and we believe the market will stabilise itself eventually.
Will the UAE cut energy subsidies?
This is not my decision, but we raised major concerns on the consumption level. In Fewa [Federal Electricity and Water Authority], we started a programme to encourage optimising electricity and water consumption including awareness campaigns and tariff adjustments in the beginning of 2014, and we have seen a positive reaction in certain sectors where up to 15 per cent of consumption levels were cut compared with 2013.
How does the UAE view Opec’s decision in November not to cut production?
Opec's decision was supported by all members including the UAE and we are confident on the strategic nature of such a decision. Opec was not part of the oversupply and shall not be blamed if other non- Opec countries oversupply the market.
How does the UAE view the outlook for oil demand and supply?
We are experiencing an obvious oversupply in the market that needs time to be absorbed. Depending on the actual production growth from non-Opec countries, this problem could take months or years. If they act rationally, we can see positive corrections during 2015. Also, the current oil prices could encourage world economic growth higher than the expected, which could drive the demand upwards.
The UAE plans to boost oil output capacity to 3.5 million barrels per day by 2017. Are there updates on this goal in light of lower oil prices?
Most of the projects are committed and under construction and we don’t foresee any delays on the capacity expansion. But building the capacity is something and using it is something else. We will always be wise and considerate of the world supply and demand.
What progress is being made on plans to boost gas production?
Our first sour gas development project operated by Al Hosn Gas Co is on-stream and the Bab sour gas project is expected in the next two years. We also finished expanding the gas pipelines capacity from the fields to Taweelah last summer.
When is the US$10 billion Shah Gas project expected to start?
We started commissioning the facility and we are progressing very well.
How will the expansion of Ruwais refinery, which will double its capacity, affect the energy industry?
We started commissioning the new facilities in the Ruwais Refinery, which will boost UAE refinery capacity to exceed 1 million bpd. This will enable Adnoc to supply the local market and expand its export capacity of petroleum products.
When will the Government reach a decision on renewal of the onshore concessions to develop Abu Dhabi’s prime oil and gas resources?
Adnoc and the Supreme Petroleum Council are working on the bids' final evaluation, and only Adnoc can provide updates on this subject.
When is the Emirates LNG project in Fujairah expected to start?
The final bids were received and evaluated and we expect to present them to the Abu Dhabi Government this month.
dalsaadi@thenational.ae
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