PAGE PREVIOUS ISSUE

 

   

 
 
 
 
 
 
CURRENCY BUYING

SELLING

US Dollar 59.9 60
Bahrain Dinar 158 158.1
Canadian $ 50.85 50.95
Euro 70.75 70.85
Hong Kong $ 7.65 7.7
Japanese Yen 0.508 0.51
Kuwaiti Dinar 204 204.1
UK Pound 103.7 103.8
Last updated: Friday 23 Dec, 2005-12.30 P.M (PST)

MORE

 

3 DAYS FORECAST
In oC

CITIES MIN MAX

HUM%

FOR.

KARACHI
Today 12 26 38 Sunny
Tomorrow 11 27 38 Sunny
Day after 11 28 38 Sunny
LAHORE
Today 1 20 87 Sunny
Tomorrow 2 20 87 Sunny
Day after 2 21 87 Sunny
ISLAMABAD
Today 0 18 59 Sunny
Tomorrow 0 18 59 Sunny
Day after 0 21 59 Sunny
HUM%: Humidity In %
FOR.: Weather Forecast
updated: Fri - Sun 23-25 Dec, 2005

MORE

 
.

 

KARACHI         - 021 LAHORE          - 042 ISLAMABAD    - 051 FAISALABAD   - 041 MULTAN          - 061 PESHAWAR    - 0521 CANADA          - 1 KUWAIT           - 965 INDIA               - 91 IRAN                - 98 U.K                   - 44 U.A.E                - 971 U.S.A                - 1

MORE

 
 
  REPORTS FROM GULF & MIDDLE EAST
 
 
 

 

 

Dec 26 - Jan 01, 2006

MAERSK TO PUMP $5 BILLION IN QATAR OILFIELD

Global hydrocarbon Major Maersk Oil will pump an additional $5bn into Qatar's Al-Shaheen oilfield as part of strategy to more than double the production to 525,000 barrels a day (bpd) by 2009.

With this, the total investment of Maersk will become $7bn (including the $2bn already invested) and the oil major said it was open to further enhance its exposure in Qatar, which is aiming to cross 1mn bpd production by 2010 from around 800,000bpd at present.

An agreement The 2005 Al-Shaheen Field Development Plan (2005 FDP) was signed between Second Deputy Premier and Energy Minister HE Abdullah bin Hamad al-Attiyah and Maersk Oil's president and chief executive officer Thomas Thune Andersen last week.

The Al Shaheen oil output will be gradually increased from 240,000bpd in the first quarter of 2006 to a plateau level of 525,000bpd from late 2009, while recoverable gases also double from the field.

Al-Attiyah is optimistic that Qatar will be able to achieve over 1mn bpd production by the end of the decade because "priorities have become realities". He said Al Shaheen project was one of the biggest fields and there would be no let-up for oil production in the country.

Andersen said the project, which will start immediately and run for six years, was a milestone because of the sheer investment and the potential it offered.

The 2005 FDP comprises drilling of over 160 additional production and water injection wells during the six-year period and establishment of three further offshore platform locations with production and accommodation facilities.

In addition, a number of appraisal wells will be drilled to establish the basis of further development activities in Block 5 offshore, which started production in 1994.

The field will continue to be developed by utilizing the state-of-the-art horizontal wells, where many wells in the past have been drilled to world record horizontal length, al-Attiyah said.

Maersk Oil and Qatar Petroleum (QP) have completed a number of major development phases using the former's technology including horizontal well technology with wells drilled up to 31,000ft. Fourteen horizontal wells have been drilled by Maersk Oil Qatar, the latest in May 2004.

"Also, many technical limits are being exceeded," the minister said referring to the drilling speed which has been continuously improved to minimize the time it takes to complete a well.

A total of 19 permanent platforms will be in place with production locations interconnected by pipelines and power cables.

As part of the 2005 FDP, Maersk Oil will also build and operate additional facilities for gathering and delivery of associated gas to QP for utilization at their Mesaieed plants.

"This agreement reflects QP's policy to comply with the guidance of the Emir HH Sheikh Hamad bin Khalifa al-Thani to increase the country's hydrocarbon reserves base, oil production and diversify the country's national income and firm up economy," al-Attiyah said.

He said the project was a big achievement of Qatar and reminded the audience that HH the Emir had always told him to concentrate on oil as well, apart from gas and gas-to-liquids.

Starting with just 400,000bpd a decade ago, the minister said, "Now we are expecting to cross the 1mn mark and we are confident of achieving it."

Asked about any plans to further increase its investments in Qatar, which has already become a pride of place in the hydrocarbon sector, Andersen said, "we will be looking at better enhancement opportunities as we start getting to know some of the details of this (the 2005 FDP) project and there might be other projects in the future."

'SADDAM USED CHEMICAL WEAPONS AGAINST IRAN'

Iranian Foreign Minister Manuchehr Mottaki has said that during the war, Saddam used chemical weapons against Iran 200 times, which rendered 100,000 people chemically disabled.

Iranian citizens disabled due to chemical weapons attacks are the living proof and witnesses of Saddam Hussein's crimes against humanity, Mottaki said at a press conference after visiting Iranians injured by chemical weapons in the 1980-1988 Iran-Iraq war in a hospital in northern Tehran.

"The Islamic Republic was the main victim of chemical weapons. It is evident that Saddam carried out all the atrocities against Iran with the help of Western companies and countries," he added.

He promised that the Foreign Ministry would struggle to restore the rights of the war disabled, adding that Iran has prepared a formal complaint, which the Foreign Ministry will present to the special tribunal trying Saddam in Iraq.

"The court has yet to review Saddam's crimes abroad. We want his crimes against Iranians to be investigated," he was quoted as saying.

The formal complaint includes documents that prove Iraq's use of nerve and mustard gas during the eight-year war, Mottaki said.

The foreign minister added that Saddam had used chemical weapons to kill Iranians during the war, especially in Kurdish regions in northwestern Iran, flattening entire villages and destroying farms.

Several dozen war veterans injured by chemical weapons are undergoing treatment in central Tehran's Sassan Hospital, one of two hospitals in the capital specializing in such wounds. "Western countries and companies that supplied Saddam with chemicals share the responsibility for this crime," Mottaki said.

"Saddam acquired chemicals from more than 400 Western companies, including 25 American, 15 German, 10 British, 3 Dutch, 3 Swiss, and 2 French companies."

Iran is deeply concerned about the influence of its archenemy, the United States, on the trial of Saddam, he added.

"We are concerned about the way the court is trying these war criminals, and America's pressure on the court (to ignore Iran's demand).

"Iran is closely observing the trial," he said.

He also asked the media to help convey to the world the message that the Iranians disabled due to chemical weapons attacks have been oppressed.

IRAN SEEKS PURPOSEFUL N-NEGOTIATIONS

On the nuclear issue, Mottaki said that there must be no preconditions in Iran's nuclear talks with the European Union, adding that Iran's stance is clearly defined, the Iranian Students News Agency reported.

The nuclear talks are quite serious and should follow a set timetable, Mottaki added.

"The topics of the talks are clear, and the talks will proceed if our European friends are determined," he noted.

"We do not want talks just for the sake of talks.

"Iran's position that its nuclear activities will not be diverted to the manufacture of weapons and that the Europeans should reaffirm Iran's right to access to nuclear technology meant for peaceful purposes are the two main points in the talks," he stressed.

The activities at the Isfahan Uranium Conversion Facility cannot be classified as uranium enrichment, and activities there will continue, he declared in response to a question on whether activities at the Isfahan UCF would continue, given that nuclear talks are underway in Vienna.

He underlined the necessity of conducting enrichment and complete nuclear fuel cycle activities on Iranian territory, saying, "The technology that is to be used has become an indigenous science."

Commenting on the recent European Union resolution accusing Tehran of systematically violating human rights at home, Mottaki said that the West constantly issues anti-Iranian resolutions and statements, which Iran rejects as baseless, while the Westerners themselves are the main violators of human rights in the world.

IRAN-EU TALKS IN JANUARY

Talks between Iran and the European Union's big three powers ended on Wednesday with an agreement to hold more negotiations in January aimed at easing concerns about Iran's atomic program, an Iranian official said.

'Talks on talks' in Vienna between France, Britain and Germany and Iran were aimed at determining whether there was a basis for further discussion between the two sides.

"We agreed to continue our talks in January. Regarding the location, we have agreed on Vienna," Javad Vaeedi, head of the Iranian delegation, told reporters.

The head of France's delegation, Stanislav Laboulaye, was less firm on a meeting next month.

"The two sides agreed to consult their respective leaderships with a view to holding another round of talks in January, with the aim of agreeing a framework for negotiations," Laboulaye told reporters.

"Both sides set out their positions in an open and frank manner," he added.

The EU wants Iran to abandon uranium enrichment while Iran insists on its right to enrichment for peaceful purposes.

The talks between foreign ministry officials from Britain, France and Germany and the Iranian delegation were the first contact between the two sides since talks broke off in August, when Iran resumed uranium conversion at Isfahan facility.

Iran on Wednesday reiterated its position that it will not back down from its right to do enrichment as guaranteed under the nuclear Non-Proliferation Treaty.

"From Iran's point of view the subject of the talks is to remove the suspension of the uranium processing facilities and this must happen within a clear timetable," Hossein Entezami, spokesman for Iran's Supreme National Security Council, told Iranian state radio.

Iran will insist on the right to enrich uranium on its own soil during the talks, Iran's Foreign Minister Manuchehr Mottaki said in Tehran.

An EU-3 diplomat said the Europeans are ready to be "realistic and distinguish between what is desirable and what is possible," namely accepting some fuel cycle work but drawing the line at enrichment.

Iran wants to at least be allowed to do research on centrifuges that carry out enrichment.

"The real diplomatic work at the moment is trying to bring the Russians on board so we can take this to the Security Council," another EU-3 diplomat said.

Russia, which has a veto on the Security Council, is building Iran's first nuclear power reactor and says there is no sign Iran seeks atomic weapons. It is almost certain to resist this pressure.

KING ABDULLAH ECONOMIC CITY

Dubai real estate giant Emaar and the Saudi government have unveiled a $26.6billion project to build a residential and commercial complex near the Red Sea port city of Jeddah.

The project, to be called the King Abdullah Economic City, is "the single largest private sector investment" in Saudi Arabia and is expected to create 500,000 new jobs, Emaar said in a statement.

"The King Abdullah Economic City will be another jewel in the crown for Saudi Arabia and a shining example of what can be achieved for the common good when two brotherly nations get together for ever closer co-operation," said Dubai's Crown Prince Sheikh Mohamed bin Rashid al-Maktoum.

Emaar is majority owned by the Dubai government and boasts a $7.7bn asset base.

It has more than 15 major projects underway in Dubai, including what is projected to be the world's tallest skyscraper, and has announced over the past four months projects worth about $10bn in Egypt and Syria.

An Emaar-led consortium made up of Saudi and Emirati companies, including the Saudi Bin Laden construction company, will be the main investor in the development.

The Saudi Arabian General Investment Authority will act as project co-coordinator, Emaar said, adding that a 30% equity stake in the development company will be later floated on the stock market.

The Saudi government has earmarked a 55mn sq m (590mn sq ft) Greenfield land and a 35km (22 mile) shoreline close to the industrial city of Rabegh for the development.

Included in the project are a new port, an industrial park, a 3,500-unit residential and hotel complex and a facility that will serve up to half-a million pilgrims arriving by sea each year on their way to Makkah. Sheikh Mohamed, Saudi King Abdullah and Saudi Crown Prince Sultan bin Abdul Aziz were among those attending the project's launch ceremony.

Meanwhile, work on the mega economic city began in Rabigh; a day after Custodian of the Two Holy Mosques King Abdullah launched the project, the largest ever joint venture in the Kingdom.

The King Abdullah Economic City to be built at a pristine location off the Red Sea "signals the dawn of a new era of economic prosperity for the citizens of the Kingdom," said Amr Al-Dabbagh, governor of Saudi Arabian General Investment Authority (SAGIA).

The new age city will have six distinct components: A modern world-class seaport, an industrial district, a financial island, an education zone, resorts and a residential area, the SAGIA chief said.

"Completion of the overall project will be done in stages with the first batch of businesses and residents moving into the city within two years," he pointed out.

Emaar Properties, the world's largest real estate company in terms of market capitalization, is the master developer of this ambitious project, the biggest outside of its home market of the UAE. SAGIA, the apex body responsible for inward investments into the Kingdom, is the prime facilitator for the development.

"SAGIA's Investor Service Center will facilitate the provision of services to potential investors," Al-Dabbagh said, adding that companies and investors would get licenses for implementing their projects in the city within a week after presenting applications.

Central to the mega project is the creation of a 2.6 million square meter new Millennium Seaport similar in size to the world's top 10 ports. With its strategic location on the Red Sea and the instant access to key cities within the Kingdom, the port will have a designated area for light industry and logistics and be a natural platform for onward movement of goods to Europe, Africa, and Asia and beyond.

The Industrial District, covering eight million square meters, will represent sectors such as downstream petrochemicals, pharmaceuticals, research and development activities as well as a host of educational institutions.

The waterside resort will serve up a most compelling mix of waterfront hotels and boutique residences. The master plan envisages 3,500 well-appointed hotel and residential bedrooms and suites, premium villas, plus an extensive retail element and an international-class signature 18-hole golf course and an equestrian club.

The Financial Island will offer 500,000 square meters of office space for the leading international and regional financial services providers, business hotels and a new exhibition and convention center. There will be two towers reaching up to 160 stories that offer compelling views of the surrounding city skyline.

OPEC'S MARKET ASSESSMENT

OPEC President Sheikh Ahmad Fahd Al-Sabah left Kuwait for China and Russia, the world's second-largest oil consumers and producers, for talks on future supply and demand prospects.

Sheikh Ahmad, who is also Kuwait's energy minister, said talks would focus on China's future demand and Russia's plans regarding expanding production capacity.

"Talks in China will focus on international energy affairs ... It is part of OPEC's strategy to open dialogue between producers and consumers," Sheikh Ahmad told reporters at the airport. "We want to know ... China's future requirements for energy and its investments in refineries and refining capacity."

In China, Sheikh Ahmad said he will also complete negotiations that began in Kuwait two weeks ago for the construction of a $5-billion refining and petrochemicals complex in Guangdong province.

On Dec. 5, the two countries signed a memorandum of understanding for the project that includes building a refinery with a capacity of between 200,000 and 400,000 barrels per day (bpd).

In Moscow, meanwhile, Sheikh Ahmad said "we want to know its (Russia's) future plans for the world oil markets in order to coordinate ... on securing supplies." He said he will also discuss the latest developments on a $1-billion loan that Russia owes to Kuwait.

The OPEC chief said that despite recent fluctuations in oil prices, they remain range-bound. "Prices, as we see them, remain within a defined range that they have not breached," Sheikh Ahmad said. He said the 11-nation Organization of Petroleum Exporting Countries will allow oil stocks to build up to a reserve of 54-55 days over the next quarter. "We are allowing the stocks to build up... for that we believe the stocks will build up ... for about 54 to 55 days in the next three months," he said.

OPEC maintained its production quota at 28 million bpd at a meeting in Kuwait on December 12 and decided not to renew its offer for emergency extra output of two million bpd.

The organization will meet again in Vienna on Jan. 31 to assess an expected seasonal drop in demand for energy between April and September, and a possible cut in output is on the cards. "I don't want to prematurely anticipate events. Let's wait until the end of January," Sheikh Ahmad said when asked if OPEC was inclined to cut output because of forecasts for warmer weather early next year.

OPEC released a report five days ago saying world demand for oil will increase by 1.9 percent in 2006 to 84.9 mbpd with booming China accounting for more than one fifth of the increase of 1.6 million over 2005.

Meanwhile, World oil prices climbed yesterday after US inventories data revealed a heavy fall in distillates, including crucial heating fuel reserves, due to recent cold weather in the United States.

In London, the price of Brent North Sea crude for February delivery won 23 cents to 56.40 dollars per barrel in electronic trading.

Crude oil stocks increased by an unexpected 1.3 million barrels in the week to December 16 to a total 322.5 million barrels, the Department of Energy said, compared with market expectations of a 1.3-million-barrel decrease.

However, in a reflection of colder US weather, distillates stocks, including heating fuel and diesel, fell 2.8 million barrels to 127.7 million more than triple analysts' forecasts of an 800,000-barrel drop.

Gasoline (petrol) inventories decreased 300,000 barrels to 204.1 million barrels, compared with predictions of an increase of 1.0 million barrels.

KINO EXPORTS TO IRAN

Pakistan has formally resumed kino (orange) export to Iran after as many as 26 years.

A chartered vessel, carrying 50 containers with 1,000 tons of cargo booked by three exporters, left Karachi Port for Bandar Bushehr seaport.

The export was resumed following the signing of a protocol between Pakistan and Iran few months back. The daily pointed out that Pakistan used to be major exporter of kino to Iran over two decades ago. This development could be seen in the context of Pakistan-Iran pledge to increase bilateral trade to U.S. one billion dollars. Presently, the trade volume is over $700 million.

SAUDI EXPORTS REGISTER RISE

Saudi Arabia's exports registered a record SR652 billion this year, reflecting positively on the country's balance of payment, according to Finance Minister Ibrahim Al-Assaf.

Al-Assaf estimated the Kingdom's oil exports this year at SR580 billion." on-oil exports in 2005 reached SR69 billion, registering a 20 per cent increase, the minister said. The figure showed Saudi's diversification drive was yielding fruits.

He was speaking to Saudi Television following the announcement of the national budget for 2006; Saudi Arabia's current account was projected to record a surplus this year, SR326.5 billion, compared to SR194.7 billion last year. This represents an increase of 67.7 per cent. The Kingdom's 2006 budget projected expenditures at SR335 billion and revenues at SR390 billion, the largest in its history. The country is expected to post a record budget surplus of SR214 billion this year on the back of surging crude prices. According to the Finance Ministry, revenues by the end of 2005 will reach SR555 billion while net expenditure will be SR341 billion.

Al-Assaf said the Kingdom's economy was in good shape, thanks to the wise policies adopted by the government. Custodian of the Two Holy Mosques King Abdullah has ordered swift implementation of the welfare projects, for which allocations have been made from the budget surplus.

Increasing government revenues have allowed the Kingdom to trim public debt all of which is owed to local institutions. Debt should fall this year to SR475 billion or 40 per cent of GDP.

Al-Assaf said SR141 billion of this year's surplus would be spent on paying the debt and added that in 2006 debt would continue to be a priority. Inflation remains tightly controlled despite the economic boom, with the cost of living index rising just 0.4 percent this year and non-oil GDP deflator, seen by economists as a more accurate benchmark for inflation, up 1.14 per cent.

"But we have to be vigilant on inflation, given the large growth in government and private sector spending," Al-Assaf cautioned. Asked about the reason for the change in revenue projections, the finance minister said it was due to fluctuating oil prices." We initially predicted that revenues will reach SR280 billion this year but it did not affect implementation of development programs, he said.

Al-Assaf said the Kingdom's oil sector grew by six to seven per cent this year at fixed prices and 37.5 per cent at current prices as a result of skyrocketing oil prices. He said the surge in oil prices had not created any inflation in the country. The ministry estimated the non-oil industry sector, which the government has targeted for growth to reduce dependence on oil revenues, would expand by 8.4 per cent this year.

Referring to the effect of WTO accession on the Saudi economy, the minister said it would reduce the Kingdom's revenues from customs tariff by SR300 million in the first year. However, the WTO entry would have a limited effect on the budget.

 
 

Pakistan & Gulf Economist 2005    Privacy Policy   |   Terms of Uses