Pipeline Magazine talked to Salem Ashoor, General Manager and Chief Representative for BP UAE about the importance of the UAE to BP’s Middle East operations.
How important is the UAE to BP’s Middle East operations?
BP has played a significant role in the Abu Dhabi oil industry since the 1930s and was at the forefront of the discovery of oil in the Emirate in 1958 and remains committed to being part of Abu Dhabi’s future. BP’s interests include joint venture partnerships with Abu Dhabi National Oil Company (ADNOC) and shareholdings in Abu Dhabi Marine Operating Company ADMA-OPCO (BP’s share is 14.67 per cent), Abu Dhabi Gas Liquefaction Company (ADGAS) (10 per cent), and the National Gas Shipping Company (NGSCO) (10 per cent). Abu Dhabi remains an important location for investment. BP has been present in Abu Dhabi for about 75 years and we hope to play a continued role. BP is committed to Abu Dhabi for the long term. Our shareholdings in the country’s operating companies contribute a significant share to BP’s worldwide production. We look forward to continuing to engage with the Abu Dhabi government in demonstrating how BP’s global expertise and technology make us the right partner for the long term and continue to play a key role in Abu Dhabi’s oil industry for many years to come.
What opportunities do you see in the UAE going forward?
Together with BP’s vast experience, technology and global scale, we can support Abu Dhabi and ADNOC’s new leadership in unlocking new growth opportunities and increasing production levels, as well as supporting their clear vision and agenda around operational efficiency, optimising resources, creating growth opportunities and developing local capability. Abu Dhabi’s role in helping meet energy demand remains very important, with its plans to increase production capacity to 3.5 mbd by 2019 and to recover more from its world-class resource base. This is highlighted by the wise role the country’s leadership has played in navigating low oil prices in a country where oil and gas are the main sources of income. The UAE’s leadership and plans around the economic diversification agenda in support of UAE 2030 vision helped manage economic impact associated with low prices. This low oil price will also create opportunities in other sectors in support of the diversification agenda which will bring huge socioeconomic benefits to the UAE economy.
What are the wider energy challenges that the Middle East is facing? How is BP helping meet these challenges?
The oil industry is a very dynamic sector and constantly confronting challenges of expansion and contraction in production and price levels. The decrease in the price of oil can be attributed to a multitude of factors but most importantly to supply and demand challenge; one of the key challenges in the Middle East is meeting rapidly increasing demand for energy on the one hand and the need to find more efficient ways to consume energy on the other. To meet this challenge the region needs technology and innovation to: increase production safely; to access new resources economically; to use energy more efficiently; and to create a more sustainable energy future. BP has developed successful partnerships with national oil companies in the Middle East including here in Abu Dhabi, at Rumaila in Iraq, the Khazzan tight gas development in Oman and a technical service agreement in Kuwait. We are bringing unparalleled scope and scale, in terms of cutting-edge technology which helps increase production and meet recovery targets in the Middle East. BP brings project management, managerial experience, capital and access to global markets. We also invest in developing local capabilities, including through seconding national staff at different BP locations worldwide. Other challenges includes technology and innovation to increase production capacity, develop new fields and maintain plateau from existing mature fields, hence the need for smart and tailored technologies and the need for IOCs expertise and technologies. The other challenge is the need for human capital and resources including experience and expertise. For example, local talent development, R&D, exposure to IOC’s experience and fields and operations for best practices and collaboration with world class universities. BP is looking at adapting to low oil price while maintaining longer-term growth prospects. (This includes focusing on staying competitive, rebalancing our resources and uses of cash, optimising capital spending, reducing cash costs, making selective divestments and imbed simplification, standardization and creating efficiencies in everyday activities while maintaining our commitment to safety and reliability.)
How is BP helping maintain production levels in the UAE’s fields?
As an international oil company, we have a large role to play. We bring world class management expertise, innovation and cutting-edge technology which help Abu Dhabi increase production and meet 70 per cent recovery targets. This is through our secondees to ADNOC and its operating companies, mainly ADMA, who provide technical and managerial support as well as exchanging best practices, and through our research centers in the UK and the US. Also, we continue to invest in developing local capabilities where possible mainly through seconding national staff to different BP locations worldwide. BP is helping ADMA and ADNOC in managing and executing a number of key projects including reservoir modelling, Carbonate Ionic Design EOR, Intelligent Subsurface Centre and Digital Oil Fields. Technology at BP is at the heart of everything we do and a critical enabler in helping us to find and recover hydrocarbons. We apply our technologies at scale across our portfolio. BP is worldclass in managing and redeveloping giant fields and is the biggest operator of giant waterfloods in the industry. This experience has allowed us to develop the deep expertise and innovative technologies needed to increase recovery factors and extend field life. BP is also a leader in developing and deploying enhanced oil recovery techniques such as low salinity water injection LoSal EOR and Brightwater for Enhanced Oil Recovery methods to boost recovery from maturing fields. This expertise can help meet the challenges of maintaining and increasing production from assets in the UAE and the Middle East.
How much emphasis does BP put on knowledge transfer in the UAE?
At BP we are committed to building local capability in Abu Dhabi and to transferring knowledge into the operating companies. Through our experts in the operating companies, we bring surface and engineering experience from our international operations and international standards as well as enabling access to our research centers in the UK and the US to support Abu Dhabi’s operations and projects. We also host a number of Emirati professionals in our international operations worldwide which is an excellent opportunity to invest in national staff. We will continue this approach in our future cooperation with the country to support its agenda around developing local capabilities in the oil and gas industry.
BP has had a long-term association with ADIPEC-why is this?
ADIPEC is an essential event for BP in Abu Dhabi and for BP in the Region. We are strongly committed to ADIPEC’s success and take part at all levels. ADIPEC has become one of the pre-eminent oil and gas conferences in the world and provides a great opportunity for BP to share knowledge and engage with the industry and with our government partners. We are planning a high level participation at ADIPEC 2016 led by the presence of key executives from BP. We will also contribute through technical presentations and papers by BP experts. BP is also one of ADIPEC’s sponsors this year. ADIPEC has become a major event where high profile industry delegates, professionals, decision makers, suppliers and service providers meet to discuss the latest developments and technologies in the industry. It’s becoming an annual event cementing its position as a central industry platform for our region and a key event on the international energy calendar. ADIPEC contributes greatly to the industry by allowing people to share knowledge, make connections and build relationships with partners and key customers. It will remain a valuable platform and networking opportunity for oil and gas executives and professionals to share their best practices and innovative solutions and discuss the challenges facing the industry.