Sultan Ahmed Bin Sulayem, group chairman and CEO of DP World, speaks to Pipeline Magazine’s Nadia Saleem in an exclusive interview about oil and gas companies and CNPC at Jebel Ali Free Zone (Jafza)
China National Petroleum Corporation (CNPC) signed a deal in April to set up its regional headquarters in Jafza, a DP World company, to oversee investments, oil services and trading in the Middle East.
Its new headquarters cover 55,000 square metres and includes a 10,000 square metre multi-storey office and warehouse facility for storage, maintenance and report of oil and gas equipment.
CNPC’s consolidation at Jafza, which comes a few weeks after it acquired an 8 per cent stake in Abu Dhabi’s giant onshore oil and gas project called Abu Dhabi Company for Onshore Oil Operations (ADCO), is of significant importance to the free zone, which could attract more international oil and gas companies to its strategic location, of close proximity to Jebel Ali Port and Al Maktoum International Airport – both major global transport hubs.
How important is the oil and gas sector for Jafza?
It is one of largest sectors in the Free Zone with more than 573 companies serving their regional and global customer from Jebel Ali. Our strategic location and key connectivity to Jebel Ali Port backed by DP World’s global network of 78 marine and inland terminals in 40 countries, makes us the ideal location for them.
The 570 companies in the sector come from the following regions:
Asia Pacific 26%
Middle East 28%
North America 18%
What is your outlook for oil and gas business growth in Jafza?
Despite the economic volatility of the global economy last year, we have seen a growth in the number of oil and gas companies by six per cent and expect similar growth this year.
What is the implication for Jafza from CNPC setting up or consolidating its entities into their headquarters here?
CNPC is one of the world’s leading energy companies, ranked third in the 2016 Fortune Global 500 list. The regional headquarters here brings together all its 16 listed companies under one roof to serve customers and to provide operational support throughout the Middle East. CNPC’s choice of Jafza as their headquarters underlines our ability to cater for requirements of its customers of any size and reinforces its presence as a key player in the region’s energy sector. We will continue to support CNPC in their ambitious growth plans by providing favourable business processes, services and facilities that compare with international standards.
What are key attractions for international companies to set up business in Jafza?
Jafza is one of the world’s most strategically positioned, efficient and value driven free zones. These unique features make us the Middle East’s international trading hub and the most appropriate location for multi-national companies to base their regional operations in. Our value propositions include:
• strategic location
• excellent infrastructure
• outstanding logistics links by sea, land and air
• highly efficient systems for setting-up business
• single window seamless operations
• attractive incentive package
• a customer-focused service culture
Located between the region’s largest port and the international airport, Jafza ranks among the world’s most efficient sea-air hubs. Al Maktoum International Airport, located at the southern end of the free zone will dramatically reduce sea-air transfers from the existing four hours, the current industry standard to less than 30 minutes, making it the world’s fastest.
Is Jafza pursuing activities and facilities to cater to more international oil and gas companies?
We offer services and facilities tailored to the oil and gas sector and provide the business requirements necessary to ensure the success of the companies operating here.
In line with the requirements of our customers, we have issued the Jebel Ali Free Zone Companies Implementing Regulations to reflect the needs of an evolving market, providing facilities that are prompt and secure.
One of the key changes is enabling businesses to transfer and continue operations in the free zone without the need to open a branch or establish a new company.
Jafza-based companies can also list their shares in financial markets by establishing a new legal type of entity such as a Public Listed Company “PLC”, which can be listed on a stock exchange. This will allow PLCs in the Free Zone to access capital through capital markets. Regulations now allow companies to restructure and rearrange their operations by converting from a Free Zone Entity (FZE) with a single shareholder or Free Zone Corporation (FZCO) with multiple shareholders to a Publicly Listed Company (PLC) and vice-versa.
What requirements are you seeing from oil and gas companies in recent times that are challenging for the industry?
We have always worked closely with our customers and continue to upgrade our regulatory framework and policies in line with their requirements.