The United Arab Emirates is moving ahead with its oil and gas investments despite the current drop in oil prices and expects no delays in plans to boost its crude output potential by 2017, the country’s energy minister said on Sunday.
“Investments are going, we are continuing with our investments,” Suhail bin Mohammed al-Mazroui, speaking to reporters on the sideline of an energy conference in Abu Dhabi, said.
Asked whether the OPEC member’s plans to boost its oil production capacity to 3.5 million barrels per day by 2017 were on track, the minister said: “Yes”.
A halving in oil prices in the past year had led to cutbacks in exploration and production across the oil industry. The fall in prices to below $50 per barrel has hit investment plans at major oil firms, national oil companies and independents which have had to find ways to conserve cash.
Global oil investments this year are expected to drop by 20 per cent, marking their biggest decline in history, Fatih Birol, head of the International Energy Agency, said on Friday.
On Friday, Saudi Oil Minister Ali al-Naimi said top oil exporter Saudi Arabia was continuing with its investments in the oil and gas industry as well as solar energy despite the fall in oil prices.
DIVERSIFY ENERGY SOURCES
Mazroui also said that the UAE was investing $35bn to diversify its energy mix and reduce its dependence on natural gas imports.
“We need to minimise our reliance on natural gas and its imports,” Mazroui said. “We are investing $35bn for that purpose,” he said, adding the aim was to decrease the OPEC member’s dependence on natural gas from 100 per cent now to 70 per cent by 2021.
Those investments are in nuclear and renewable energy projects, he said.
The UAE is one of the world’s top 20 gas producers, but the country became a net importer of natural gas in 2008.
Its natural gas consumption reached a record high of more than 2.4 trillion cubic feet (Tcf) in 2013. The country uses a large amount of natural gas in its enhanced oil recovery operations and to operate its power and desalination plants, according to statistics by the U.S. department of energy.
The UAE is the first Gulf Arab state to start building a nuclear power plant to generate energy. The $20bn Barakah project is expected to provide 24 per cent of the UAE’s energy by 2020, when all four reactors come onstream.