Saudi Arabia Oil and Gas Market Update

Main Update Highlights from entire month of June, 2013

Saudi Arabia and Egypt sign power line agreement ‐ Cross‐border power line will have capacity
to transport 3,000MW of electricity a day

Riyadh sets pace for light‐rail plans ‐ The pending contract awards on the Riyadh scheme will set
the standard for future Saudi metro projects.

Biggest project finance deal of 2013 signed by Aramco and Dow ‐ Saudi Aramco and Dow sign
$12.5bn Sadara financing.

Saudi Aramco awards contracts at $7bn Jizan refinery. Japanese and European contractors join
South Koreans in winning contracts at downstream project in Saudi Arabia. Saudi Aramco has awarded
seven contractors engineering, procurement and construction (EPC) packages at the $7bn Jizan refinery
project in the south of Saudi Arabia. Aramco announced it had made the awards via its website on 21
October.

WorleyParsons historic 4th Aramco contract ‐ Australian engineering contractor WorleyParsons
has said that it agreed to terms with Saudi Aramco which will see its current Maintain Potential
Programme (MPP) contract extended for a further two years.

Jazan Refinery contracts signed ‐ Ceremony held to sign the engineering, construction and
procurement contracts of the Jazan Refinery and Terminal. The Project will raise gasoline production by
80 MBD and diesel production by 250 MBD, and will produce approximately 1 million tons per annum
(MTA) of benzene and paraxylene petrochemical products. Once completed by the end of 2016, the
Project will be capable of processing 400 thousand barrels per day (MBD) of heavy and medium Arabian
crudes. The Terminal, which is part of the Project, will accommodate Very Large Crude Carriers (VLCCs).
The Project also features a 2400‐MW high‐efficiency combined cycle power plant to fulfil the electricity
requirements of the Refinery as well as a large part of the electricity needs of the west coast. Khalid G.
Al‐Buainain, senior vice president, Engineering, Capital & Operations Support, Saudi Aramco, signed the
contracts with representatives of eight local and international construction and procurement
companies; namely: Al‐’Ali Al‐Ajmi Group, Petrofac Saudi Arabia Ltd., Hyundai Saudi Arabia Ltd., Hanwa
Engineering & Construction Corporation, JGC Corporation, Hitachi Plant Technologies Ltd., SK
Engineering & Construction and Technicas Reunidas.

Sources: Saudi Magazines, Newspapers and Websites

UAE Oil and Gas Market Update

Main Update Highlights from entire month of June, 2013

Majid Al Futtaim earmarks Dh3b for Dubai expansion ‐ Majid Al Futtaim Holding has charted a
Dh3 billion expansion plan to extend and enhance its Dubai businesses over the next five years to meet
the future demand of customers.

Dubai records significant growth in all key sectors ‐ in 2012 and the emirate will continue to maintain its
position as a regional and global hub for business and finance, according to a latest report from the
Dubai Economic Council, or DEC.

 Abu Dhabi records 7.7% growth on high oil prices ‐ Abu Dhabi grew 7.7 per cent year on year in
2012, on higher oil prices. “The flexibility of Abu Dhabi economy combined with the huge financial
surpluses, strong growth in non‐oil sectors, high oil prices, along with several other significant factors
have all contributed to the stability and sustained growth of the local economy,” said Statistics Centre –
Abu Dhabi, or Scad.

 ADMA‐OPCO inks Dh2.8b EPC deal ‐ Abu Dhabi has awarded a mega contract to expand its oil
output from off‐ shore Umm Lulu fields. Abu Dhabi Marine Operating Company or Adma‐Opco has
United Arab Emirates

signed Dh2.8 billion Engineering, Procurement and Construction, or EPC, contract for Umm Lulu (UL) full
field development project package‐1 with the National Petroleum Construction Company, or NPCC.

ADNOC and OMV to explore eastern Abu Dhabi ‐ ADNOC and OMV East Abu Dhabi Exploration
which is part of the Austrian oil and gas company OMV, signed an exploration agreement on Sunday to
pursue exploration for oil and gas in the Eastern region of Abu Dhabi.

UAE yard to make pipelines for Aussie LNG venture ‐ US engineering firm CB&I announced its
manufacturing facility in the UAE will be carrying out pipe fabrication work for an unnamed major
liquefied natural gas (LNG) project in Australia. The contract is worth in excess of US$40 million.

NPCC wins $766mn Umm Lulu contract ‐ Abu Dhabi Marine Operating Company (ADMA‐OPCO)
has awarded the Abu Dhabi‐owned National Petroleum Construction Company (NPCC) a US$766 million
EPC contract for the Umm Lulu field development project.

Petromin launches new fully synthetic high performance auto oil.

Contractors to bid for water contract at Abu Dhabi nuclear project ‐ Work will involve building a
sea water bypass pump house at the Baraka nuclear project

Polysys approves design for Abu Dhabi polymer additive plant ‐ Joint venture with South Korea’s
Songwon to build plant and to supply region’s polyolefins sector

Exxon mobil has launched Mobil DTE 932 GT, a high‐performance oil intended to help improve
the reliability and power output of gas turbines. Mobil DTE 932 GT is part of the company’s range of
lubricants and services specifically designed to help power operators improve the safety and
productivity of their operations. Exxon mobil offers a range of high‐quality lubricants — including the
Mobil DTE 932 GT gas turbine oil and the Mobil SHC Pegasus natural gas engine oil — alongside its
proprietary online oil analysis service, Signum Oil Analysis. The Mobil DTE 932 GT oil is designed to limit
varnish formation in gas turbine power systems. During testing, Mobil DTE 932 GT was shown to deliver
performance benefits such as high‐temperature performance, good deposit control and excellent foam
control and air release. Mobil DTE 932 GT meets or exceeds the standards set for General Electric (GE)
frame 3,5,6,7 and 9 turbines. The Mobil SHC Pegasus oil has been approved for use in GE Waukesha APG
1000 engines. Mobil SHC Pegasus has the potential to reduce fuel consumption by up to 1.5 per cent
and to increase oil drain intervals from four to eight times that of conventional gas engine oils. The
Signum Oil Analysis service enables operators to proactively monitor the condition of lubricants and to
address conditions that have the potential to lead to unscheduled downtime and increased costs.

Fujairah terminal to get the green light ‐ New storage terminal is due to be commissioned at the
end of this month. Horizon Terminals Limited (HTL) has announced its new $100 million oil terminal in
Fujairah will be commissioned at the end of the month. The terminal will have a storage capacity of over
240,000 cubic metres and will be HTL’s second project in the emirate.

Cockett moves office in Dubai ‐ Cockett Marine Oil relocates to new premises at Jumeirah Lakes
Towers, Dubai.

Sources: GulfNews, Meed, KhaleejTimes, Oil & Gas Magazines and Newspapers

Latest OPEC Oil Production Figures

Main Update Highlights from entire month of June, 2013

Crude oil production from OPEC rose by 70,000 b/d to 30.57mn b/d in May 2013, according to a recent
(10 June) Platts survey of OPEC and oil industry officials and analysts. Increases totalling 180,000 b/d from
Angola, Kuwait, Libya, Saudi Arabia and the United Arab Emirates were partly offset by 110,000 b/d in
reductions from Algeria, Iran, Iraq and Nigeria. ‘All the figures point to a market being significantly
oversupplied, and in May, production actually rose slightly. Yet the price of Brent crude oil stays solidly
above $100/b, and the organisation at its late‐May meeting did lower output, ’said John Kingston, Platts
Global Director of News. ‘A lot of market participants have been predicting a significant slump in prices for
a while as a result of the supply/demand imbalance, yet the markets aren’t going along with that forecast.

Saudi Arabia’s use of crude for direct burning in power stations rises during the summer months, and the
latest survey showed the kingdom increasing output for the second consecutive month after a steady
downtrend that took it from 10mn b/d last August to 9.2mn b/d early this year. The survey results showed
that Saudi production rose by 100,000 b/d to 9.4mn b/d in May 2013, up from 9.3mn b/d in April.
Iran’s output slipped to 2.68mn b/d under continuing pressure from US and European Union sanctions
directly targeting Tehran’s oil revenues. The US Congress is currently considering a new bill that obliges
China, India and other countries still buying Iranian crude to cut their purchases by a total of 1mn b/d
over the next year to avoid penalty. An amendment attached to the bill would also require a reduction in
the total value of those imports to deny Tehran the possibility of benefiting from higher oil prices.

Iraq, now OPEC’s second biggest producer after Saudi Arabia, saw output edge down to 3.1mn b/d in
May, from 3.15mn b/d in April as exports dropped. Nigerian output slid further, to 1.94mn b/d, from
1.97mn b/d in April. Nigeria is the OPEC producer most affected by the shale oil boom that has slashed its
sales into the US, but its oil sector is also subject to frequent sabotage by militants in the Niger Delta. The
estimates leave OPEC overproducing its 30mn b/d crude output ceiling by some 570,000 b/d. They also
show the oil producer group continuing to pump well above its own 29.84mn b/d projection of demand
for OPEC crude this year and above that of the International Energy Agency (IEA) which in May said it
expected the call on OPEC crude to average 29.6mn b/d. In fact, the IEA expects demand for OPEC crude
to remain below 30mn b/d for the next five years, thanks in part to the boom in US shale oil production,
notes Platts. OPEC, which was seemingly unfazed by the shale phenomenon, now plans to study it.
Ministers, however, decided at their 31 May meeting in Vienna to extend their current output ceiling,
which has been in place since the beginning of 2012, through the second half of this year and to review it
in early December.

Resource: Oil and Gas Magazines, Newspapers & websites

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