Musabbeh Al-Kaabi, Chief Executive Officer, Mubadala Petroleum spoke exclusively to Pipeline Magazine about the firm’s business outlook.
Can you outline the key opportunities globally for Mubadala Petroleum?
Mubadala Petroleum operates from a relatively unique position, as a nationallyowned, international company. We have the beneﬁ t of the support of our shareholder, which often helps in bringing some unique and attractive opportunities. Nevertheless, we operate very much as a commercially driven entity, so are looking to generate healthy returns from our investments, in common with our partners and competitors. Our focus is on projects and assets where we can add value, use and build on our existing technical and commercial capabilities, and meet our strategic and ﬁ nancial requirements. More speciﬁ cally, we are looking for opportunities in proximity to our existing operated assets; so building on our producing assets in Thailand and Indonesia, and the discoveries we have made and are working to develop in Malaysia. Such opportunities allow us to use the operating capability we already have and pursue additional opportunities efﬁ ciently and with important local experience. Elsewhere we seek to build on the knowledge and experience we have of redevelopment and EOR/IOR projects through the acquisition of interests in discovered assets where we can add value and capitalise on upsides through the application of technology and operational excellence. Collaboration is at heart of what we do, be it with partners in licences or PSCs, host governments, key contractors and even the communities in the vicinity of our operations.
How has Mubadala Petroleum dealt with the low oil price environment?
We responded quickly and decisively. Like all companies operating in the international oil and gas industry, we have had to undertake concerted efforts to ensure our business activities remained commercially strong. Creative and committed efforts from everyone in our team, from those manning our production platforms and our operations overseas through to our corporate headquarters, ensured we achieved signiﬁ cant cost savings and implemented a range of efﬁ ciency enhancing measures that will provide a lasting beneﬁ t. Examples have included logisitcal and operational efﬁ ciencies in the Gulf of Thailand, renegotiation of drilling, offshore support and a range of other contracts. We have also beneﬁ ted from collaborative arrangements for both exploration and production operations with other operators.
How much emphasis are you putting on efﬁciency?
It is extremely important. We need to be competitive at lower commodity prices. Consequently we have made every effort to look at our internal processes and structures to ensure they are ﬁ t for purpose. Many of the most innovative and effective solutions came from our teams out in the ﬁ eld; our employees have responded to the challenge in a highly effective and professional manner and are embedding the gains we have made. We also continue to work with our contractors to ensure we obtain fair but highly competitive rates while maintaining quality. Nevertheless, throughout this process we have remained committed to maintaining our record of reliable operations and, most important of all, continue to have an uncompromising focus on safety.
What is your business outlook for the coming year?
what remains a challenging environment. The efﬁ ciency measures and improvements achieved in our operating costs need to be sustained, but I am conﬁ dent that we can do that. And I am optimistic that the market fundamentals are coming back into line to underpin recent price gains, although the ﬂ exible nature of the unconventionals sector in the US will continue to act as a dampener for anything other than gradual upward movement in prices. We are also optimistic we will see more M&A opportunities come on the market as the differences in valuations and price expectations between buyers and sellers narrow at realistic levels.
Did you have a successful ADIPEC last year?
ADIPEC 2015 was very successful and active for Mubadala Petroleum. As well as the regular stream of visitors across the stand, we were able to host a number of foreign delegations from the countries in which we hold interests and where we want to do business, as well as establish new relationships and reinforce bonds with our existing partners. In 2016 we’ll be continuing to tell our evolving story, including some of the technological and operational advances we have made in our operated business in SE Asia, the projects we have in development and the aspirations we have to continue to grow our portfolio. We are also a sponsor of the Young ADIPEC programme, so very much look forward to contributing to the attraction of the next generation of Emirati geoscientists and engineers to our great industry.