GULF

 

Nov 25 - Dec 01 , 2002

 

1.INTERNATIONAL

2. INDUSTRY

3. FINANCE

4. POLICY

5. TRADE

6. GULF

 

GAS DISCOVERIES: GULF MAY FACE CHALLENGE

Once the projected new gas discoveries and developments in the sector in the Gulf Arab states Iran and Iraq are realized, the region could claim control of almost 50 per cent of the global proven reserves, significantly up from the current 35 per cent, a recent study published in the Oil and Industry bulletin of the UAE Ministry of Petroleum and Mineral Resources revealed.

However, the report also points out that the countries of the Gulf may face competition from Pakistan and some other Asian states in this sector in the near future. "Gulf States are now facing another challenge, which is a growing tendency in Pakistan and other Asian countries to search for gas. There are strong prospects for such discoveries, which could largely boost that region's gas reserves from the current 10,330 billion cubic metres accounting for nearly seven per cent of the global gas reserves," the study pointed out.

Currently, the Gulf has proven gas reserves of 52,230 billion cubic metres of associated and non-associated gas. This turns out to be a ratio of 456 billion cubic metres per one million people, nearly 18 times the global average of 25 billion cubic metres. At the production rate of 2000, such reserves could last 245 years as compared to a global average age of 61 years. The regional reserves could also be sufficient to supply gas to the entire world for 21 years.

"It should be noted that the large gas discoveries in the Gulf over the past years were not a result of the exploration activities but due to development projects carried out in the sector," the report pointed out. Significant gas projects in the UAE and the multi-billion-dollar liquefied natural gas (LNG) projects recently were taken up in the region, highlighting the above point. Saudi Arabia is also working on a huge, complex $25 billion gas initiative, which may put gas at the centre of energy resource development strategy in the region.

QATAR: ENHANCING PRIVATE SECTOR'S ROLE IN ECONOMY

In 1997, the IMF advised Qatar to step up structural reforms in order to facilitate economic diversification. Amongst others, the IMF called for privatisation, deregulation and financial sector reforms. The authorities heeded the call and made concerted efforts to involve private sector firms in the economy.

In 2002 alone, a series of new laws were passed in order to improve the investment climate, including copyright, protection of trademarks and fighting money laundering.

Starting from June 2002, individuals have become free to import branded goods for personal use without having to either seek permission from local agents or to pay any commissions to the agents.

The new law replaces the 1986 rule that granted commercial agencies the sole selling rights for branded consumer goods.

Recently, the government formed a council comprising leading businessmen to advise on policies needed to help boost the private sector's role in the economy.

The selected members include representatives from the ruling Al Thani family and large business families. The council is expected to become an influential body in the formation of local economic policies. The council is separate from the Qatar Chamber of Commerce and Industry, which provides advice to the minister of economy and trade.

The Qatari economy is reaping the benefits of opening the energy sector to foreign investments. In a span of a few years, Qatar has managed to more than double its installed oil production capacity to 850,000 barrels per day, largely due to the efforts of American and European oil companies.

Likewise, Qatar is an acknowledged global player in the export of liquefied natural gas (LNG) thanks to the efforts of international oil companies.

To be sure, local firms are being encouraged to participate in areas once regarded off limits. Privately owned United Development Company (UDC) will be allowed to take part in Qatar's economic development programme including oil, gas, petrochemicals, and electricity.

ARAB FUND REELS UNDER $601M IN ARREARS

The Arab League's lending arm is still reeling under heavy arrears owed by Iraq and two other conflict-hit member states as its long-standing efforts to tackle the problem have apparently been bogged down by their financial woes.

The Abu Dhabi-based Arab Monetary Fund (AMF) said Iraq, Sudan and Somalia owed it nearly 158.2 million Arab Accounting Dinars ($601 million) at the end of 2001, accounting for almost half its paid-up capital of 324 million dinars ($1.23 billion).

A large part of the arrears is in interest as the three members have failed to repay their debt to the fund for more than 10 years, the AMF said in its annual report.

Although it struck a deal with Sudan last year to pay monthly instalments to settle the remaining debt, the East African country suspended payments just two months later.

"As of December 31, Sudan failed to repay four monthly instalments, totally around $6 million. Soon after an agreement was signed with the AMF, Sudan started paying monthly instalments of $1.5 million," it said.

IRAQ WAR FEARS LIFT OIL PRICES

Oil prices have continued to rise sharply amidst concerns that the UN search for weapons of mass destruction in Iraq would fail to prevent a war.

As the inspectors got down to business, oil industry officials took the view that a war against Iraq remained a strong possibility.

"There are concerns [about] whether Iraq will comply completely with inspections," said ABN Amro's Paul Ashby.

During early trade, one of the benchmark's of the world oil market, Brent crude oil futures, added 32 cents to Monday's near $1 (63 pence) price rise. One barrel of Brent crude oil now costs $24.60.

"Fundamentally the oil price is probably $22 to $24 a barrel, so there's still a war premium for some sort of disruption to supplies," Mr Ashby said.

In the US, futures contracts for the delivery of crude oil in December rose more than $1 to $26.54, their highest level in more than two weeks.

ISRAELIS RETURN TO BETHLEHEM

Israeli forces have entered the West Bank city of Bethlehem, in response to the suicide bomb attack on a Jerusalem bus.

Israeli military sources said troops surrounded the Dheisheh refugee camp near the city and headed for the Church of the Nativity, to prevent Palestinian gunmen seeking refuge there as they did in a 39-day stand-off earlier in the year.

The suspected Jerusalem bomber, whom Israeli police identified as 23-year-old Nael Abu Hilail, was believed to have come from Bethlehem.

NATO BACKS DISARMING IRAQ, BUT SPLIT ON WAR

Nato leaders issued a united declaration of support for efforts to disarm Iraq, papering over their deep differences on the U.S. threat to go to war.

As the Nato summit opened in Prague, U.S. and British warplanes bombed southern Iraq. Analysts said such near-daily skirmishes amounted to an undeclared air war, giving Western jets increasing dominance of the skies over Iraq.

The Pentagon said the target was Iraqi air defence radar, attacked because Iraqi forces had been spotted moving a missile battery into the southern no-fly zone. Iraq said the Western planes bombed civilian targets and had been driven off by Iraqi anti-aircraft fire.

GREEN CARDS TO LURE IRAQI SCIENTISTS

The United States is offering a fast track to American citizenship for Iraqi scientists willing to blow the whistle on Saddam Hussein's alleged weapons of mass destruction (WMD).

Under the Iraqi Scientists Immigration Act of 2002, passed by the Senate, up to 500 scientists could be given green cards if they reveal critical information on weapons programmes.

BP SIGNS CONTRACT

BP, which has sold a 49 per cent stake in BP Oman to state-owned Oman Oil Co, has signed a management contract to run the company for a year.

Sources close to BP said the decision to sell the stake in BP Oman was part of its plan to withdraw from the retail sector in the region and focus more on the core business.

GOVERNMENTS WARNED AGAINST BACKING U.S.

Intellectuals and scholars from various Arab and Muslim countries warned their governments against providing any kind of support or facilities to the U.S. in its possible strike on Iraq, stressing that such cooperation would have serious consequences on the region.

A 15-page statement signed by 209 intellectuals and scholars, including women, with a majority from Saudi Arabia, was broadcast by Al Jazeera TV.

IRAN'S N-PROGRAMME RAISES NEW WORRIES

While the Bush administration has focused public attention on Iraq's alleged weapons of mass destruction, Iran's nuclear weapons programme has in recent months begun to appear more worrisome than Iraq's, according to U.S. intelligence.

Administration officials and nuclear proliferation specialists say Iran is trying covertly to produce weapons-grade uranium or plutonium.

SADDAM BLAMED FOR GAS ATTACK

A former Iraqi army chief held in Denmark for possible war crimes said that forces directly controlled by Iraqi President Saddam Hussain launched a deadly chemical gas attack on Kurds in the late 1980s.

Nizar Al Khazraji, who made his comments to the Al-Hayat, is suspected of crimes against the Kurds and was placed under house arrest in Denmark to prevent him from avoiding possible prosecution.

PROBLEMS OF NEEDY

Crown Prince Abdullah bin Abdulaziz, Deputy Premier and Commander of the National Guard, has ordered a working team be formed to implement a strategy to "wipe out poverty in the country as soon as possible and solve the problems faced by needy people throughout the Kingdom."

While visiting the old districts in Riyadh and meeting its poor residents, the Crown Prince said: "It is really a serious problem and we have to do something about it so urgently. These poor people have the right to be heard."

'JORDAN FIRST' DRIVE LAUNCHED

A campaign to boost national loyalty and strengthen ties among members of the community is being worked out by a special committee formed by King Abdullah II of Jordan.

Entitled 'Jordan First', the plan will target all Jordanians "regardless of their origins to strengthen their loyalty to the homeland and stimulate their positive potentials," official sources said.

THURAYA RINGS UP RAPID GROWTH

Thuraya Satellite Telecommunications Co has achieved rapid growth by selling more than 100,000 handsets and 62,000 working lines, a top official said.

"We expect sales of handsets to reach 120,000 by the end of this year and working lines to reach about 75,000 to 80,000. It is very encouraging for us," Thuraya Chairman Mohammed Omran said.

Thuraya's second satellite is scheduled to be launched in January or February and Boeing Satellite System will build the third GEO-Mobile communications satellite for the firm. It will be delivered in early 2005.

MEBANK TO GIVE AWAY FREE FLIGHTS

MeBank is offering free flights to debtors of other banks provided they transfer an existing personal loan of over Dh50,000 to a loan from meBank. The offer continues until December 31.

Starting from November 24, all UAE residents with personal loans of over Dh50,000 from any other bank in the UAE can transfer their loan to a mePersonal and receive a free Gulf Air flight to one of 16 selected destinations.

AERO ASIA

Aero Asia, the largest private Pakistani airline, has expanded its facilities and operations in the UAE with three more offices in Bur Dubai and Ajman to cope with increasing passenger demand.

TOPAZ PROFIT JUMPS 61PC

Topaz Energy and Marine (Team) listed on the Muscat Securities Market - recorded a net profit of $3.24 million on sales of $38.9 million for the first nine months of 2002.

DUBAI SHORTCUTS SINGAPORE

Comparisons are odious anyway, but they are more so when it is between Dubai and Singapore.

From a pro-business administration and laissez faire economy to a myriad of festivals the two city-states are famous for, there is a long list of things that are common between the two. So, it would appear to be more than coincidence that when Dubai announced a plan to establish a global healthcare city, policy planners in Singapore have also been considering ways to promote the city as the South East Asian medical hub.

LEBANESE PILOTS ACCEPT PAY CUTS

Pilots at Middle East Airlines, Lebanon's flagship carrier, have been forced to accept unfavourable new contract terms.

Last week, the pilots were told they must agree to fewer benefits and more working hours or else be replaced by foreign pilots.