An installation at Saudi Aramco's Manifa oil field in Saudi Arabia. Reuters
An installation at Saudi Aramco's Manifa oil field in Saudi Arabia. Reuters
An installation at Saudi Aramco's Manifa oil field in Saudi Arabia. Reuters
An installation at Saudi Aramco's Manifa oil field in Saudi Arabia. Reuters

Czech engine parts misused in drone attacks on Saudi oil facilities, Czech security officials reveal


Nicky Harley
  • English
  • Arabic

Security officials have revealed Czech engine parts and designs were used in drone attacks on Saudi oil facilities by Yemen’s Houthi rebels.

Last year Houthi rebels claimed responsibility for a drone attack on the world's largest oil processing facility in Saudi Arabia.

Now, an annual report by the Czech Republic’s Security Information Service (BIS) has revealed the drones were developed from Czech designs and engine parts.

“The risks associated with re-exports and the use of reverse engineering were highlighted in September 2019 by attacks against the civilian infrastructure of Saudi Arabia, including against the oil facilities in Abkajk and Churajs,” it says.

“From the analysis of debris from the attacks, it was found that copies of Czech engines were used for attacks assembled by reverse engineering, which used some components of the original engines.”

The incident last September targeted the processor and a major oilfield, operated by Saudi Aramco.

The 17-minute strike by 18 drones and three low-flying missiles caused a spike in oil prices, fires and damage, and shut down more than five per cent of global oil supply.

In its security report, BIS has also revealed it successfully disrupted an elaborate export route to get tanks and military combat vehicles to North Korea.

“The BIS found that the North Korean side prepared a supply route for export through Moldova,” it said.

It revealed the tank engines were declared to customs officials in Moldova as parts for fishing vessels in the first part of their journey and then this was changed to “engines for generators” on their arrival in Ukraine.

While the Houthi rebels in Yemen claimed responsibility for the oil facility attack, both Saudi Arabia and the US has asserted that they do not have the capability for such a sophisticated attack.

Saudi Crown Prince Mohammed bin Salman described the incident as an “act of war” by Iran but stressed that it should be treated as a political matter rather than a military one. He too warned the international community of further incidents unless the world takes strong action to deter Tehran.

In numbers: China in Dubai

The number of Chinese people living in Dubai: An estimated 200,000

Number of Chinese people in International City: Almost 50,000

Daily visitors to Dragon Mart in 2018/19: 120,000

Daily visitors to Dragon Mart in 2010: 20,000

Percentage increase in visitors in eight years: 500 per cent

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A full hand wound charge is of 16.5minutes 

This gives 1.1 hours of light on high mode or 2.5 hours of light on low mode

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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.

Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.

Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.

Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.

“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.

Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.

From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.

Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.

BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.

Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.

Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.

“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.

Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.

“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.

“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”

The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”