Page 10 - DMEA Week 18 2021

DMEA FINANCE & INVESTMENT DMEA

Bahrain next to follow

asset monetisation path

MIDDLE EAST REPORTS emerged this week suggesting that (KAB) tight oil discovery later in the year once
Bahrain will be the next Middle East country to it has established the probable recovery factor
look to monetise its hydrocarbon infrastructure for the estimated 82bn barrel asset. Meanwhile,
to support its economy. Italian firm Eni is set to kick off drilling its first
In a televised interview with Bloomberg, Oil well in the 2,800-square km offshore Block 1,
Minister Mohammed bin Khalifa Al Khalifa for which it signed an exploration and produc-
said: “We’ve got a lot of infrastructure assets that tion-sharing agreement (EPSA) with Tatweer
can easily be” structured to raise funding, noting: Petroleum in early 2019. By the end of the year,
“We’ve been looking at this for some time. We Manama is expecting to open bids for three
haven’t made a decision yet.” other blocks.
Al-Khalifa added that the 112-km, 762-mm
Saudi-Bahrain A-B oil pipeline would be an Downstream
“ideal asset with a throughput structure for some Interestingly, Al-Khalifa did not include the
kind of private equity deal”. Meanwhile, he noted 270,000 bpd Sitrah refinery owned by Bahrain
the possibility of leveraging the Kingdom’s Bah- Petroleum Co. (BAPCO) in the assets consid-
rain LNG import terminal as well as upstream ered for attracting investment.
infrastructure. He did, however, provide a progress update
The oil minister said that state energy pro- on the BAPCO Modernisation Project which
ducers are benefiting from strong demand for will see the facility’s capacity expanded to around
infrastructure assets with steady returns. “There 400,000 bpd, noting that it should be completed
seems to be a large pool of capital interested in within the next 18 months.
this, despite all the challenges with the environ- The $4.2bn main EPC contract on the $6bn
mental drive.” project was awarded to a consortium of Lon-
The news follows recent energy-linked efforts don-listed TechnipFMC, South Korea’s Samsung
by the UAE, Saudi Arabia, Kuwait, Oman and Engineering and Spain’s Tecnicas Reunidas, with
Qatar to raise cash, with oil and gas pipeline completion initially envisioned in 2023.
lease-and-rent-back deals generating more Meanwhile, the oil minister spoke of ongoing
than $27bn for Saudi Aramco and Abu Dhabi talks with international companies for the devel-
National Oil Co. (ADNOC). opment of a $2bn petrochemical plant that will
It is worth noting that the newly formed Ara- be fed by naphtha from BAPCO.
mco Oil Pipelines Co. (AOPC) owns at least half
of the A/B pipeline which, following a $350mn Finance
fourth phase expansion, pipes up to 350,000 bar- The potential monetisation of assets follows the
rels per day (bpd) of crude from Aramco’s pro- successful completion of an eight-year sukuk
cessing facilities at Abqaiq in Eastern Province. bond issuance in late March by Tatweer’s par-
Downstream MEA (DMEA) understands ent, the national oil and gas holding company
that Manama receives a 50% share of the 150,000 nogaholding.
bpd produced by Aramco at the offshore Abu The issuance raised $600mn at a price of
Sa’fah terminal as well as a further 75,000 bpd of 5.25% according to Reuters, with initial guid-
Arabian Light crude through the A/B conduit. ance having estimated a price of 5.75-5.875%.
The onshore Awali field, the site of the Gulf The raise represents a significant increase on
Cooperation Council (GCC’s) first oil find in the expected $500mn, with the company having
1932, remains the kingdom’s sole source of received demand of nearly $3bn.
domestic production of around 50,000 bpd. nogaholding was advised on the deal by Gulf
Al-Khalifa confirmed the government’s plans International Bank, HSBC, JPMorgan and BNP
to invite IOCs to develop the Khaleej al-Bahrain Paribas.™

P10 www. NEWSBASE .com Week 18 06•May•2021