mubadala’s al kaabi says oil slump has poised the company for growth
Last Updated : GMT 06:49:16
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Last Updated : GMT 06:49:16
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Mubadala’s Al Kaabi says oil slump has poised the company for growth

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Arab Today, arab today Mubadala’s Al Kaabi says oil slump has poised the company for growth

Musabbeh Al Kaabi told oil industry executives at the CERAWeek
Abu Dhabi - Arab Today

The head of the newly merged petroleum division at Mubadala Investment Company says the tough oil price environment of the past two years forced the company to transform the way it operates upstream and has left the new larger company poised for growth.
Musabbeh Al Kaabi, the chief executive of Mubadala Petroleum who will formally take over in May as head of the US$40 billion merged Petroleum & Petrochemicals division, which will absorb the much larger assets from International Petroleum Investment Company (Ipic), told oil industry executives at the CeraWeek gathering in Houston that the oil price crash forced Mubadala Petroleum to take drastic action to steer the division back to profitability.
He said that the merger of the two Abu Dhabi strategic development companies has created an integrated oil and gas division that is now well positioned to take advantage of opportunities in an industry still recovering from the slump.
"As a larger player with a fully integrated value chain, the new petroleum and petrochemicals business is uniquely positioned to leverage its relationships, unlock synergies among its asset companies and deploy its financial strength to take advantage of new investment opportunities," he said on Tuesday in Houston.
The merger brings together Mubadala’s legacy assets – which include operatorship of offshore marginal fields in the Gulf of Thailand; Dolphin Energy, which imports and distributes Qatari natural gas; and participation in the Occidental-operated Mukhaizna oilfield in south-central Oman – with Ipic’s mainly downstream assets, including full ownership of Spain-based integrated oil company Cepsa, Nova Chemicals of Canada, a controlling interest in Austria’s Borealis petrochemicals and a major share of Austria’s OMV integrated oil company.
Mubadala’s upstream assets suffered like most of the industry from the slump, especially because of the marginal nature of its Asian fields.
Mr Al Kaabi described, as an example of the retrenchment and search for lower costs, how the company transformed operations of the Jasmine field offshore Thailand, a field whose production had peaked at 28,000 barrels per day in 2008.
In the past two years, Mubadala renegotiated contracts with its main oil services partner, Petrofac, cut 55 per cent from drilling costs by innovations such as use of geosteering horizontal drilling techniques, as well as operational efforts such as cutting $1 million a year by sharing and reorganising its helicopter use.
Mr Al Kaabi said the result on this field was to extend its life well beyond 2022 with a total production target of more than 100 million barrels, compared to original expectations that the field would be depleted by 2015 having recovered only 10 million barrels.
The Mubadala oil chief talked of synergies and growth for the new larger group, but he didn’t specifically address what opportunities the company will focus on as it brings together the disparate interests that are run currently by a number of fairly autonomous chief executives.
The Abu Dhabi energy leadership – including Abu Dhabi National Oil Company chief executive Sultan Al Jaber, who spoke earlier at CeraWeek – has made it clear that they plan to leverage the strong positions of companies like Borealis, Nova Chemicals and the downstream operations of Cepsa to realise goals of tripling Abu Dhabi’s petrochemicals output to about 12 million tonnes a year by 2021.
But it is not yet clear how Abu Dhabi will pursue upstream diversification internationally, which will fall to Mr Al Kaabi’s division. Interestingly, he also cited the Oil Search interest inherited from Ipic, though that has hitherto been seen primarily as a marginal financial interest in a Papua New Guinea liquefied natural gas project.


Source: The National

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mubadala’s al kaabi says oil slump has poised the company for growth mubadala’s al kaabi says oil slump has poised the company for growth

 



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