Energy investments in the Middle East are expected to reach $ 805 billion

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Energy investments in the Middle East are expected to reach $ 805 billion

APICORP: Optimism for a recovery in global GDP levels


Wednesday – 23 Ramadan 1442 AH – 05 May 2021 AD Issue No. [
15499]


APICORP said that the Middle East and North Africa region has strong qualifications as a major source of hydrogen (Middle East).

Dubai: «Asharq Al-Awsat»

The Arab Petroleum Investments Company (APICORP) expects that the total planned and planned energy investments in the region will reach more than $ 805 billion over the next five years, an increase of $ 13 billion over last year’s report. APICORP said in its recently released “Energy Investment Outlook in the Middle East and North Africa for the years 2021-2025” that the modest increase is attributed to four main factors, namely the prevailing optimism of global GDP levels, rising energy demand, and the resumption of energy projects. In the country of Libya, which alone constitutes about $ 10 billion of the planned projects, according to the report, and finally the pace of adoption of renewable energy sources has accelerated regionally, as current estimates indicate that the Middle East and North Africa region will add 3 gigawatts of solar energy during 2021 alone. This is equivalent to double what was added in 2020, and that figure will reach 20 gigawatts over the next five years. On the other hand, the economic outlook for the region indicates that commodity and export prices will be a major driver for the expected recovery in the countries of the region during 2021, but the region’s economies will continue to face financial pressures as a result of the unprecedented rise in debt levels, lower oil prices and revenues from the tourism and Hajj sectors, in addition to a decline The volume of personal transfers.
Dr. Ahmed Ateeqa, CEO of the Arab Petroleum Investments Company (APICORP), said: “The Energy Investment Outlook Report for the Middle East and North Africa for the years 2015-2021 indicates that the energy sector is witnessing relative stability in terms of investments in light of the growth of the GDP of the region’s countries during the current year. And the continuing momentum of energy transformation, and we expect the sector to recover gradually and steadily from the repercussions of the (Covid-19) epidemic in light of the continued influx of public sector investments and the growing demand for energy.
The report expects a decline in total gas investments in the region over the next five years by about $ 9.5 billion, to reach a total of $ 75 billion. This decrease, compared to the previous year’s report, is due to the completion of a number of mega projects during the year 2020. He warned the countries of the region against committing to new projects in light of the presence of a surplus in gas production.
At the country level, Saudi Arabia, Iraq and Qatar top the ranking in terms of planned gas investments, due to the giant North Gas Field expansion project in Qatar, the gas-to-electric projects in Saudi Arabia and the giant unconventional Jafurah field, and the gas-to-electric projects in Iraq and its determination to reduce emissions of greenhouse gases resulting from combustion.
On the other hand, the planned investments have maintained relatively steady levels, reaching $ 133 billion for the period 2021-2025, which indicates the desire of the countries in the region to resume building natural gas capabilities when conditions are ripe, especially the ambitious and unconventional projects in both Saudi Arabia and the UAE. And the Sultanate of Oman and Algeria.
APICORP’s report indicates that the investments directed to the electric power sector have become the highest compared to other energy sectors, as they are expected to reach about $ 250 billion – $ 93 billion for the planned projects and $ 157 billion for the planned projects.
The report notes that renewable energy has a large share of these investments, at a rate of 40%, in light of the countries in the region proceeding with plans to diversify their energy sources, and clarified that this shift to renewable energy sources is a major factor behind the growing share of the transmission and distribution projects, in particular This is because the integration of renewable energy sources into the electricity networks requires large investments to connect and digitize the grid, not to mention by enhancing storage capacity to absorb the surplus electricity that is generated.
The report also expects the planned investments in the petrochemical sector in the region to reach 109 billion dollars during the years 2021-2025, an increase of about 14.2 billion dollars from last year’s expectations. On the other hand, it is expected that the planned investments will decline by about 7.7 billion dollars to reach 12.5 billion dollars as a result of the completion of many mega projects during 2020.
APICORP’s report stresses the importance of investing in advanced digital solutions in the field of energy storage to achieve the goals of renewable energy, and to meet the growing demand for electricity and the need for a system that balances supply and demand in real time. It must first develop its regulations to reflect the growing role of warehousing and take advantage of the flexibility it provides.
The Middle East and North Africa region has strong potential as a major source of hydrogen, with its abundance of low-cost gas and renewable energy sources. Saudi Arabia and Morocco are among the pioneers in the field of low-cost blue and green hydrogen, carbon-free ammonia and other low-carbon products, and other countries such as Oman, the UAE and Egypt are seeking to establish their position in this field as well.


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