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Apr 23 - 29, 2001

Saudi seeks foreign investment

Oil power Saudi Arabia has renewed its call for foreign investment in its vast refining sector. Saudi Aramco's refining assets can be viewed as significant pre-investment platforms, supporting appropriate refinery-based petrochemical and fuels facilities, Saudi Aramco President Abdallah Jum'ah told a gas conference at Yanbu this week.

Many of Saudi Aramco's refineries and gas plants will be building power and steam co-generation facilities to optimise fuel consumption, thus offering further investment opportunities.

The kingdom invited foreign oil companies several years ago to develop investment ideas for its refining system, which now boasts overall capacity of just under two million barrels per day (bpd).

And the latest investment award has gone to Italian energy group ENI. Its Snam engineering unit has won a contract to build a 200,000-bpd gas condensate fractionation plant adjacent to the Ras Tanura refinery.

Industry sources said the kingdom has spent nearly $2 billion overhauling its refining sector in a bid to meet domestic product demand, which is growing at a rate of more than 2.5 per cent per year.

The east coast Ras Tanura facility was spruced up several years ago with a $1.2 billion overhaul.

And capacity at the Red Sea export refinery at Rabigh was lifted last year to 425,000 bpd from 400,000 bpd.

The bulk of the products churned out by the kingdom's plants including its 50 per cent stakes in the Samref and Sasref joint ventures with ExxonMobil and Royal Dutch/Shell, respectively is destined for the domestic market.

Industry sources reckon domestic consumption is now running at close to one million bpd.

'Iran to export gas to UAE despite islands dispute'

Iran, the world's number two producer of natural gas, has signed a two-billion dollar agreement to supply gas to the United Arab Emirates despite the two nations' Gulf islands dispute , a press report said on Thursday.

The English-language Iran News, citing an "informed source," said the National Iranian Oil Co. (NIOC) had signed the agreement with Crescent Petroleum, an Emirati company registered in Panama.

According to the source, the gas will be supplied from Iran's offshore Salman field in the Gulf before being transported through a pipeline to the Mobarak platform near the Abu Mussa island where it will be pressurised and sent to northern Emirates and Dubai via two pipelines.

UAE's agreement for the purchase of gas from an Iranian field shared by Abu Dhabi, is a clear indication of the improving relations between the Islamic republic of Iran and the United Arab Emirates, the daily said.

Crescent Petroleum reportedly plans to sell the Iranian gas to the UAE ministry of power and electricity to be used in power plants in northern Emirates as well as Dubai, it said.

Iran has an estimated 20,000 billion cubic metres (700,000 billion cubic feet) in gas reserves, and this deal would be the first time Tehran has agreed to sell gas to the Persian Gulf littoral states, the daily said.

But on Wednesdsay, a member of the Iranian parliament's national security committee called for a re-evaluation of trade ties with the UAE because of the two nations' dispute over the Gulf isles.

Mohammad-Hossein Abu-Torabi said Tehran should reconsider its estimated two billion dollars in direct and indirect annual trade with Abu Dhabi if the UAE persists on continuing such an unfriendly approach.

He accused the Emirates of "irrational" international lobbying to put forward its claims to Abu Musa as well as the Greater and Lesser Tunbs, three strategic Persian Gulf isles held by Iran since 1971.

Qatar speeding up work on gas pipeline projects

Qatar with one of the largest gas reserves in the world is currently gearing up to export gas through pipelines within the next two to three years and Pakistan is an important part of these gas export initiatives. Qatar has so far been exporting gas in liquefied form only.

Work is already underway on two gas pipeline projects to deliver gas to the neighbouring countries. Of these, one is the Dolphin project being promoted by the UAE Offsets Group (UOG) in association with Total FinaElf of France and Enron Corporation of the US. They plan to supply the country's north field gas to the emirates of Abu Dhabi and Dubai, and possibly Oman, in the first phase.

There are indications that the UOG is seriously thinking to extend the pipeline to include Pakistan in the loop in the next phase of the project. There have been reports that none else than Sheikh Zayed, the UAE President, insisted on the inclusion of Pakistan in this pipeline project.

Like the trees we die standing

Over 52 years have passed since Khan Yunis refugee camp was founded as "temporary shelter" for Palestinian refugees. The home of over 60,000 refugees is now one of the most crowded spots on earth. For a stranger to wander through its narrow alleyways and makeshift houses, by the mounting garbage piles and impoverished streets and markets, one would then realize that human misery is not an abstract concept, but a living reality.

But beyond the misery and despair, human triumph stands, narrating a story of a dignified nation, who learned to survive despite repeated massacres, and fought to rebuild what the invaders destroyed.

As I followed the TV screen while a reporter's camera scanned the horrifying damage inflicted by Israeli bombs and bulldozers on the sleeping camp, many thoughts crossed my mind, memories of past years and images of history I cannot dare forget.

Iran hopes for more Gulf state security pacts

Iranian President Mohammad Khatami hopes a new security agreement between Iran and Saudi Arabia will lead to similar pacts with other Gulf Arab states, a Saudi newspaper reported on Thursday.

Iran and Saudi Arabia signed the security accord on Tuesday, in a fresh sign of warming relations between the Gulf neighbours after years of mutual distrust.

"I hope the agreement marks the first step towards a general and comprehensive security agreement between the countries of the region, so that these states can live in peace," Khatami told Saudi Arabia's Arabic-language Al-Watan newspaper.

Riyadh says the pact with Tehran aims to fight crime, terrorism and drug trafficking and should not be seen as a defence pact.

Non-Arab Iran opposes the deployment of U.S. and Western forces in the region and is keen to sign defence agreements with its Arab neighbours. But Gulf Arabstates, which look to the West for military support, have declined Iran's offer.

Qatar, Bahrain ease travel rules

Qatar and Bahrain have agreed to ease travel regulations for their citizens and study proposals for a causeway joining the two Gulf Arab states, newspapers said on Wednesday.

A joint committee, holding its first meeting after the World Court resolved a territorial dispute last month, also asked energy officials to explore the possibility of supplying Qatari gas to Bahrain, the newspapers said.

Bahrain and Qatar agreed to allow their citizens to travel between their countries using just identity cards. A communique said the states had decided to complete within 10 months a feasibility study into a causeway linking the two states across Gulf waters.

The Hague-based International Court of Justice ended the long-standing territorial dispute, endorsing Bahrain's sovereignty over the Hawar islands and awarding two minor islands and a disputed town to Qatar.

Israeli warplanes overfly south Lebanon

Israeli warplanes flew over south Lebanon Thursday for the fourth consecutive day, said Lebanese security sources.

The planes patrolled Israel's former security zone in south Lebanon and the occupied Shebaa Farms territory on the Israeli and Lebanese border, the sources said.

On Monday, Israeli jets broke the sound barrier over Beirut and southern regions, following an overnight air strike on a Syrian army radar station in eastern Lebanon that left at least one Syrian soldier killed and four wounded.

The raid came after an Israeli soldier was killed in an attack by Hizbollah on Saturday in the Shebaa Farms, occupied by Israel from Syria 1967 and now claimed by Lebanon.

Kuwait to facilitate business visa

Kuwait aims to facilitate business visas as part of its economic reform programme and to boost foreign investment. Sources told Arabic daily Al-Anba that Commerce and Industry Minister Salah Khorshed was this week scheduled to meet Interior Minister Sheikh Mohammad Khalid Al Sabah to formulate the procedure and eliminate the obstacles hindering the issue of business visas.

The two ministers would discuss the facilities required to attract foreign businessmen to Kuwait's free-trade zone by eliminating bureaucracy so as to issue such visas in shortest possible time.

The Kuwaiti cabinet had approved a draft law on foreign investment in June 1999, in a bid to boost investment, but still it awaits parliament approval.

As per draft law, investment projects can be exempted from income tax and other taxes for a period of 10 years, as well as be allotted land and real estate required for the investment.

US expects new Iraq policy

US Assistant Secretary of State Edward Walker said on Wednesday he expected progress by June on a new international policy towards Iraq that focuses on easing civilian sanctions while reinforcing controls on arms.

"Our objective is to do away with the sanctions regime and replace it with controls over weapons of mass destruction and military items,"

Walker told reporters after meeting Jordanian Prime Minister Ali Abu Al-Ragheb on the first leg of a tour of Iraq's neighbours.

Bahrain's emir reshuffles government

Bahrain's emir, Sheikh Hamad bin Issa Al-Khalifa, reshuffled the government on Tuesday, bringing in five new faces but leaving the key posts unchanged, the official news agency GNA reported.

The reshuffle follows a mid-February referendum in which a national charter for democratic reforms, notably the restoration of parliament after a 26-year break and the setting up of a constitutional monarchy, won a crushing majority.

The foreign, defence, oil and interior portfolios remained in the same hands, while Nabil al-Hamer, chairman of the Al-Ayam press group, took over as information minister and Jassem Al-Ghatam as education minister.

Qatar comes to defence of Lebanese pound

Qatar joined a Gulf Arab consortium in defending the Lebanese pound by pledging to deposit $60 million with Banque du Liban, local newspapers said on Wednesday.

The Qatari assistance brings Arab deposits with the central bank to a little over $1 billion, which form a significant part of gross foreign reserves. Newspaper reports said Prime Minister Rafik Al-Hariri was informed of the Qatari decision during a current trip to Qatar. Hariri has been touring Arab states to seek aid to bolster the pound, which has been under relentless pressure from deteriorating public finances and a volatile front with Israel.

Iraq ready to sell special price crude to Lebanon

Iraq confirmed on Monday its willingness to sell crude oil to Lebanon at preferential prices, in an agreement similar to one concluded between Baghdad and Amman.

"Iraq has offered to provide Lebanon with crude (oil) at reduced prices," said parliament speaker Saadun Hammadi during a visit by a Lebanese parliamentary delegation to the Iraqi capital.

Hammadi added that Baghdad was "ready to grant Beirut credit to pay its oil bill."

Oman offers gas exports to UAE

Oman has offered to export natural gas to neighbouring United Arab Emirates (UAE), Omani Oil Minister Mohammad bin Hamad Al-Rohmi said in an interview published on Sunday.

"In principle, we are ready to sign a heads of agreement. Now we are awaiting a response from the UAE government," Romhi told the weekly Middle East Economic Digest, adding that negotiations over the proposed sale were "quite advanced".

He stressed that any deal would be on a short-term basis for "smallish" volumes.

Oman, which last year launched exports of liquefied natural gas to Asia, signed a memorandum of understanding with the UAE`s Offsets Group in June 1999 to import Qatari gas via the Emirates under a multi-billion-dollar project known as Dolphin.

"Exporting gas (to the UAE) will make sense as it will create a network, which will allow gas to come in and out. I have always said there is nothing wrong with either importing or exporting gas," said Romhi.

Oil prices expected to keep rising

Iran said Saturday it expects oil prices to continue pushing upward in the coming months, the official IRNA news agency reported.

Oil Minister Bijan Namdar-Zanganeh, cited by IRNA, said the situation on the market was not a cause for concern with prices last week hitting two-month highs as worries over shortages and technical buying gave the market a lift.

"Despite OPEC production cuts that took effect April 1, demand is still less than supply," Zanganeh said. "In the third quarter, supply will be less than demand."

He also stressed that OPEC was determined to maintain its price-band mechanism, which automatically triggers increases or cuts in production if prices go outside the range of 22-28 dollars per barrel.

Iran is the second-largest producer in OPEC after Saudi Arabia with a daily ouptut approaching four million barrels per day (bpd).

EIB, Arab funds grant Egypt $200 m for new power

The European Investment Bank (EIB) has given Egypt 75 million euros (70 million dollars) for the construction of a 750,000 kilowatt power plant, Egyptian Electricity Minister Ali al-Saidi was quoted as saying Friday by the official agency MENA.

Saidi also announced that the Kuwait-based Arab Fund for Economic and Social Development and the Saudi-based Islamic Development Bank agreed to donate 131 million dollars for the same project.