sheikha lubna al qasimi inspiring...

The magazine of Total in the Middle East | Fall-Winter 2012 | Issue 4

SHEIKHA LUBNA AL QASIMIINSPIRING CHANGE

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Outset

It is often said that Total has the most diversified operations of any international oil company in the Middle East. The latest demonstration of our wide

ranging activities in the region is an agreement with Jordan to supply more than 120 service stations, over

and above the 24 stations owned and operated by the company, securing a market share of 33 per cent.

All around the Middle East, Total is striving to develop its capabilities – together with its partners. Partnership is the essence of our Marketing & Services and New Energies business, just as it is the core of our activities in Exploration & Production and Refining & Chemicals. Indeed, unlike other IOCs, Total bases its

retail operations in the region on equity partnerships with local affiliates and distributors, combining their market knowledge with the strengths of the Total brand and our product know-how.

Such a commitment to working together is opening up new opportunities, in Jordan and elsewhere. It is an approach that has defined our operations in the Middle East over the last nine decades.

And it continues to guide what we do globally. The word “services” in Marketing & Services further emphasises the priority we attach to the relationship with customers and business partners.

In today’s marketplace of expensive energy, customer expectations in terms of product and service quality are higher than ever. People want fuels, lubricants and other petroleum products that optimise efficiency, increase value for money and reduce carbon emissions. They expect far more from a service station than just gasoline! And they also want us to develop clean energy sources such as solar or biomass.

The Middle East is a key market in our growth strategy. With a footprint spanning the majority of countries and many years’ experience working in different business environments, we are showing that Total is here to stay and here to invest, whether in aviation fuels in Dubai, lubricants in Saudi Arabia, new service stations in Jordan and Lebanon, the Shams 1 solar power plant in Abu Dhabi or Sunpower’s best-in-class technology in photovoltaic panels. And hopefully, there will be many more projects!

Total’s diversified operations will continue to be a critical asset in the Middle East. Marketing & Services and New Energies will be an increasingly important component of them.

In this issue of Afaq, we hear the views of His Excellency Alaa Batayneh, Energy and Mineral Resources Minister of Jordan, on the benefits of Total’s long-standing presence in the country and the future opportunities there. We also speak to Her Excellency Sheikha Lubna Al Qasimi, UAE Minister of Foreign Trade, about her achievements as a role model for women in the region. In addition, we explore Dolphin Energy, the first ever regional gas grid development in the GCC.

I do hope you enjoy the latest issue of Afaq.

With warmest regards,

All around the Middle East, Total is striving to develop its capabilities with its partners. Such a commitment to working together is opening up new opportunities.

Fall-Winter | 2012 | 4

Philippe Boisseau,President Marketing & Services,President New Energies,Total

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Total Middle East Communications,

BurJuman Business Towers, 11th Floor,

Sheikh Khalifa Bin Zayed Road, PO Box 14871, Dubai, UAE.

www.total.com

Write to us at [email protected]

ContentsOutset 3By Philippe BoisseauTotal’s President Marketing & Services and President New Energies

Insights 4Downstream moves EastHE Alaa Batayneh Jordan’s minister of energy, Total’s Momar N’Guer and Leila Benali of IHS-CERA share their views on the growth of marketing activities in the Middle East

One on one with Sheikha Lubna Al Qasimi 16Inspiring change Afaq interviews HE Sheikha Lubna Al Qasimi, UAE Minister for Foreign Trade

Flagships 20Dolphin Tales: The story of a GCC partnershipHow Dolphin Energy has achieved the first gas project of its kind in the region, linking Qatar, the UAE and Oman

Personal, local, global 28 TEP Yemen: teamwork across bordersAfaq discovers how close cooperation between the different offices of Total E&P Yemen is ensuring successful operations in spite of a clouded situation in Yemen

At a glance 34 Total news around the world and the region in brief

CREDITSAfaq, meaning Horizons, is published by Total Middle East CommunicationsPublisher: Arnaud BreuillacEditors in Chief: Xavier Preel, Eve Gautier-DumarestEditor: Fouez BalitEditorial Committee: Dunia Chalabi, Thomas Fell, Kaissar Ghoussoub, Andrew Hogg, Valérie Laugier, Charles-Etienne Lebatard, Sandrine Saboureau, Delphine Saucier, Frédéric TexierContributors: Suzanne Fenton, Mark WattsWith assistance from: Laila KababCopyright: Amelia Johnson, Gladieu Stephen, Laurent Dumarest, Nidal Nassar, Dolphin Energy, Qapco, TotalProduced by: ASDA’A Burson-Marsteller, DubaiPrinted by: Atlas Printing PressInformation as of November 30, 2012

Afaq magazine is printed on Hanno Matt Art paper procured from responsibly managed forests. Hanno Art is FSC (Forest Stewardship Council) and PEFC (Programme for the Endorsement of Forest Certification) Chain of Custody certified and compliant with the Lacey Act

Cover image: Her Excellency Sheikha Lubna Al Qasimi

The Middle East has been famed for its vast oil reserves for decades. Converting

that considerable wealth in raw materials into the basis of a thriving diversified

economy is the priority of planners across the region.

DOWNSTREAM MOVES EAST

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By Suzanne Fenton

Sheikh Zayed Road – Dubai, UAE

Insights Downstream moves East


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For decades, the Middle East has been at the epicentre of the global oil industry. Though

upstream continues to dominate the region, today, most new investment is dedicated to downstream as regional governments diversify their economies.

The region’s ultimate aim is to create jobs in the long term by developing its downstream offerings and encouraging the participation of the private sector in order to achieve sustained growth. With the upstream market already exploited, national

oil companies (NOCs) in the region have ramped up downstream investments in order to control all areas of the energy industry.

The push for downstream and the increased demand for refined products is driven by two major factors, according to Leila Benali, Director, Energy Middle East & Africa at IHS-CERA. Most countries have very young and increasingly urbanised populations; population under 14 exceeds 35 per cent in Iraq and Yemen for instance. Another demographic factor is the large share of expatriate population in some countries. Second, whereas prior to 2000, a large part of hydrocarbon revenues in the GCC were invested into international markets, since then these revenues are increasingly invested back into the region’s ambitious infrastructure and development projects, driving refined products demand further.

A heterogeneous marketToday, the marketing of petroleum products varies

widely across the Middle East. Saudi Arabia and Iran are the largest markets in the region, accounting for nearly two thirds of the region’s demand for refined products, says Leila Benali. The third market for refined products in the region is Iraq, followed by various parts of the Gulf and the Levant.

For the most part, Iraq does not have the capacity to meet rising domestic demand as it lacks both investors and the necessary infrastructure. It is difficult to get an exact idea of demand in post-war Iraq, explains Benali, because of changing demand patterns, and partly due to instances of smuggling. For example, jet fuel demand growth accelerated to more than 7 per cent per annum during a few years because of the consumption by military troops.

In the Gulf and the Levant, the power sector consumes large volumes of heavy fuel oil and diesel,

something that is most notable in the summer months when temperatures rise and cooling systems are functioning at full speed. Shortages of natural gas meant around 250,000 barrels were consumed daily by the Saudi power sector this summer, leading it to import an average of 50,000 barrels per day of HFO during the first eight months of 2012. IHS CERA expects the Middle East to be the most electricity-intensive region in the world driven mainly by its macroeconomic priorities.

At the other end of the spectrum are those countries with relatively lower growth, including Dubai and Iran where, since retail oil prices were reformed, demand has since dropped 3-4 per cent.

Because most countries do not have a residential gas network, and depending on electricity prices, some countries in the region use liquefied petroleum gas (LPG) for cooking. Iran on the other hand has the largest gas network with a 92 per cent penetration.

Similarly, the demand for jet fuel is largely dependent on aviation activities and therefore there is much higher consumption in the GCC, Lebanon and Jordan than anywhere else in the region. These countries are home to the Middle East’s major airlines and have massive airport developments either underway or planned. Jet fuel is typically 5-10 per cent of the refined products market in the region, with some exceptions like Bahrain where it exceeds 40 per cent.

Partnering is a key to successThe key players in the sector are the NOCs and

the international oil companies (IOCs). In some major producing countries, such as Saudi Arabia, the decision has been taken to invest in developing refineries “close to the well-head” in addition to investing in key international markets, Benali explains.

Total is building the Jubail refinery with its Saudi partner Saudi Aramco. Supplied by pipelines from two giant offshore fields (Manifa and Safaniyah), the complex refinery, with a capacity of 400,000 barrels a day, is one of the most efficient in terms of crude oil conversion. Iran too is developing the Shazand Imam Khomeini Refinery in the city of Arak, in the east of the country. When complete, this will process 250,000 barrels of light and heavy crude oil per day.

In developing such projects, many regional companies have formed joint ventures with international players to gain technical expertise.

Issues such as increased competition in a region as well known for its volatility as it is for being a petrochemical hub will be a challenge. Competition is especially noticeable in aviation fuel and the lubricants market where a number of brands are present and

many unofficially manufacture their own products and so governments need to implement standards, Benali observes.

A challenging contextThe Arab Spring has also had an impact on the

region’s downstream business, affecting investment and stalling projects at one end of the spectrum and boosting job creation up the political agenda at the other. Several countries were also forced to decrease retail prices in order to calm public unrest.

“The perception of pressure is making it difficult for governments to change prices. Governments will have to keep the lights on and the oil flowing to ensure security of supply. It’s a serious issue in the Levant,” Benali says.

a large scope of opportunity, Benali explains. However, political and economic instability is preventing any investment and progress in the short to medium-term at least.

Going forward, the region will perhaps see the penetration of other fuels in transportation in the longer term, such as LNG, especially in those places close to major ports, says Benali.

Something else that could change going forward is the Middle East’s interconnectivity and its connection to other markets. Projects worth billions of dollars are currently underway in the UAE, Saudi Arabia, Kuwait, Qatar, Iraq and Jordan to build and expand world-class ports and railway networks. The development of an integrated transport and logistics network will be crucial in ensuring the success of a downstream industry in the region.

As in the days of the Silk Road centuries ago, strong transport links, a thriving downstream sector and an upcoming young demographic will ensure the Middle East retains its envious position as the trade hub between East and West.

Leila Benali, Director, Energy Middle East & Africa, IHS-CERA

Motor vehicles per 1,000 people in 2009-2010Source: World Bank

Jet fuel is typically 5-10% of the refined products market in the region, with some exceptions like Bahrain where it exceeds 40%.

In order to manage energy demand, and despite the pressure, governments are trying to reform prices whenever possible, Benali adds, citing Dubai as an example. It has started to reform electricity prices while the plan has been on the drawing board elsewhere for a few years “Most governments in the region are very aware of the issues of supply and marketing as they integrate them in their long-term energy strategies,” says Benali.

HotspotsGlobally, the Middle East region is third in terms of

GDP increase, among the top regions in terms of oil demand growth and is poised to become first in terms of electricity intensity, Benali says.

Investment hotspots have emerged in Saudi Arabia and Iraq because of their size and those countries with young populations, such as the Levant. Iran offers enormous opportunities but is impossible to tap into because of sanctions.

Yemen could fall in this category as it is has a very young and highly rural population and therefore offers


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TOWARDS A LEADING ROLE IN THE MIDDLE EASTMomar N’Guer, Total’s Senior Vice President Africa and Middle East for

Marketing & Services, talks to Afaq about the company’s strategy to expand and the potential of emerging markets

Momar N’Guer, Senior Vice President Africa and Middle East, Marketing & Services division, Total While about 80 per cent of Total’s profit comes

from the upstream business, the importance of downstream activities, of which the

Marketing & Services business is part, cannot be underestimated.

The Marketing & Services business in the Middle East counts as one of Total’s major areas of growth together with Africa and Asia. It focuses on the supply and sale of petroleum products, including retail activities at service stations for light vehicles and trucks as well as general trade in automotive fuels, biofuels, home heating, heavy fuel oil, lubricants, LPG (liquefied petroleum gas), asphalt, aviation fuel and special fluids.

Today, Total employs 7,500 people across Africa and the Middle East and operates 4,500 service stations in the region, of which 1,068 are located in the Mediterranean/Middle East area. In 2011, the sale of petroleum products worldwide represented about 3.6 million barrels per day. And the company has operations for aviation and lubricants in most countries across the region.

Total’s strategy is to grow through both consolidation and making acquisitions in countries including Jordan and Lebanon, selling all finished products, including LPG, jet fuel, gasoline, petrol, diesel as well as specialties such as lubricants for automotives, power plants and petrochemicals, bitumen and additives.

Total split its previously integrated refining and marketing model at the beginning of the year to ensure a sharper focus on downstream. The newly independent Marketing & Services business will have more visibility and ensure more competitive expansion plans, particularly in terms of retail distribution in the Middle East.

The Middle East is one of the key areas of development for Total; the region is booming economically and demographically, so it makes sense to focus on downstream businesses.

Total’s recent win of a distribution licence in Jordan was an important first step at a time when the Jordanian market is starting to liberalise.

Momar N’Guer has worked for Total for 28 years both in the head office in Paris and in the field. In this time, he has held a number of senior positions, including Vice President for East Africa and the Indian Ocean and for the last five years, he has been Vice President for aviation fuel, in charge of global operations for aviation, dealing with airlines and airport authorities, including in the Middle East. He sees the huge potential the region offers for a company like Total which is bullish enough to enter the region’s emerging markets.

Emerging marketsEgypt is one example of a key market on which Total

has its sights set. With about 35 million tonnes of oil products being sold in Egypt each year, the scope for growth is vast given the size of its population and a boom in car sales. Issues remain over fuel subsidies, estimated to be between US$15-20 billion, which the new government is trying to tackle.

“At the moment there are opportunities for us to grow in Egypt. We are considering them very seriously and we expect in the coming month to significantly change size in the country,” N’Guer explains.

In Saudi Arabia, too, a kingdom where volumes are huge, Total is looking at retail developments, such as building service stations which will have lubricant activities with local partners. Already present in Saudi Arabia’s lubricants market, the largest on the Arabian Peninsula, Total is developing a refinery with the national company Saudi Aramco. Situated in Jubail on the kingdom’s east coast, the refinery is expected to be complete by the end of 2013 and will process about 400,000 barrels of crude oil each day.

Though certain countries in the region remain

politically and economically challenged, Total is not deterred. N’Guer sees the enormous potential these countries will offer when stability returns.

“Lebanon is an important market, partly because one day things will settle in Syria. We had started negotiations in Syria and were quite advanced…but as soon as things settle, there is an opportunity for us,” N’Guer explains.

“The challenge is this: you have countries where the market isn’t open and is for local companies, which always creates problems in terms of efficiency. And you have markets where the prices of fuel are very low because of intervention,” N’Guer explains.

And when prices are too low, the quality and safety of service stations also becomes an issue.

An issue specific to the region has also been seen over the last two years: the instability which has rippled across the Middle East as a result of the Arab Spring. However, N’Guer believes that the resulting environment that eventually emerges will be a positive one.

“I have a feeling that what the Arab Spring will bring to this market is this: the upcoming of the middle class, in terms of cars, roads, infrastructure and therefore the increase in the market for fuel. The second thing is: people will be more demanding of what they expect from oil companies – so not only fuel, they will want access to the same services that are available in Europe, for example, shops in service stations,” N’Guer explains.

Consumers in the region want high grade lubricants and food courts in service stations, says N’Guer, so “demand is getting quite close to what is seen in Europe which makes it very different from the market in Africa”.

Relationships The Middle East is a unique region where progress

relies heavily on the relationships international companies forge with local entities. Success cannot be achieved alone and trust will mitigate many of the challenges.

“We are used to working in this environment. There are countries where prices are regulated, and others where markets are open and we can handle that sort of diversity,” N’Guer explains. “We bring to governments our knowledge of a competitive environment and credibility. We have discussions about what is best for

We will look at every opportunity in the Middle East in terms of marketing and services activities, provided the environment is conducive; there are no limits.

The company is already present in Lebanon and is looking at opportunities to grow further. Most of Total-branded service stations in Lebanon currently belong to dealers but Total plans to buy them back to improve the facilities and develop other SFS (shops, food, services) activities. At the same time, it will increase its footprint and market share, impacting positively on Total’s regional business. Once the civil unrest in Syria is over, Lebanon will become even more strategic

ChallengesHowever, there are a number of challenges

international oil companies must face if they are going to compete in the downstream sector. These range from a lack of standards and quality control to understanding the various ways each market operates.

Total’s Marketing & Services development in Mediterranean/Middle EastSource: Total data

Morocco

Algeria

Tunisia

LibyaEgypt

Turkey

SyriaLebanon

Jordan

SaudiArabia

Yemen

Oman

UAEQatar

Bahrain

Kuwait

Iraq Iran

Turkmenistan

Afghanistan

Tajikistan

Ouzbekistan

Presence in 1998New markets added by 2012



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the country and its economy. This is how you build, through long-term relationships.”

It is this loyalty that Total shows its regional partners, even in times of uncertainty that gives the company its edge. As Jordan’s Minister of Energy and Mineral Resources, Alaa Batayneh himself noted: Total stayed while others shied away.

Overall, when considering all its affiliates, Total has an average local shareholding of 22 per cent, which means the local partners have equity in the business, something else that sets Total apart from its competitors.

Another way Total can be differentiated can be seen in the variety of nationalities of its staff. In the Middle East and Africa, it employs 220 expatriates, of which half are non-French and come from the region itself.

“When you’re in France, London, The Hague, and you want to operate in the Middle East, you need to be humble enough to say this is an environment I am not familiar with. I am going to partner with people who know the environment and who can help me decipher it and predict what changes are likely to happen. While Total can bring its brand and its knowledge and deep-

rooted history in this region, for the rest I need to rely on people. This is the basis and it makes us very different,” N’Guer explains.

The downstream market in the Middle East is growing and with billions of dollars worth of downstream projects currently underway across the region, the potential opportunities for Total are endless. In a region which faces many challenges, one thing is certain: Total’s unwavering commitment to take advantage of this new era where markets are opening up and become market leader in the region, in terms of retail.

“Let me put it this way: we will look at every opportunity in the Middle East in terms of marketing and services activities, provided the environment is conducive; there are no limits. The market is so big and demand is so huge. I am sure that when you look at the positioning of our competitors, they are very cautious about the region. We are optimistic about the downstream business in the region. As and when markets open, we will be investing. We will be the main player. One hundred per cent,” N’Guer says.

JORDAN OPENS UP TO A BRIGHT FUTUREJordan is modernising its energy sector in response to changing local and global conditions and opening the door to further collaboration with international companies. His Excellency Alaa Batayneh, Minister of Energy and Mineral Resources, talks to Afaq about Jordan’s plans for the liberalisation of the downstream market

Excellency Alaa Batayneh, Minister of Energy and Mineral Resources

services for the consumer and definitely better prices, in accordance with best international practices.

Will it also generate jobs?Definitely. In Jordan we have just over 450 gas

stations and there is room for much more. We recently simplified the instructions to license these gas stations which will open this to more investments. The licenses of the three companies will create more competition and the level of service will definitely increase. Each of these gas stations will have an average of 25 employees, so in a country where 50 per cent of the population is under 18 and 70 per cent is under age of 30, there are huge opportunities for employment.

For you, on both a ministerial level and a personal level, it is an enormous achievement?I am happy to be part of this together with my team and our consultants and we have good faith in Total. We have tried to be fair and to move this project forward. We have had to consider the existing status of a refinery that has over 3,500 employees and which is owned by 30,000 Jordanians through the stock exchange. There were a lot of issues between the government and the refinery that we managed to iron out. It took a lot of work and many ministerial

What does the recent award to Total of a licence to supply Jordan’s retail market mean to Jordan’s energy sector and

also the wider economy?I am very happy that we are invigorating Jordan’s

energy strategy, especially in a sector that has experienced delays due to various reasons. However, I cannot highlight enough our excitement and our strong belief in Total and their international capability and reputation. They have already invested heavily in Jordan and have waited until we realised our goal of liberalising the market, slowly but surely. Jordan is following a path of liberalisation and openness in all sectors and this sector we were a bit behind in. So I think Total took a very important step in partnering with Jordan in taking the country forward. It is a very important sector and it needs a lot of help in attaining international standards.

As you mentioned, it has been a long time coming to this point, so what does it mean to Jordanian consumers in terms of what benefits they can expect now?

It is very important to highlight the international experience and quality that this new licence will add to the market. It will eventually lead to the best quality and

HE Alaa A Batayneh, Minister of Energy and Mineral Resources and Minister of Transport, Hashemite Kingdom of Jordan


Total Lubricants blending plant in Jebel Ali – Dubai, UAE


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contract value. The solution is to build an LNG port in Aqaba. Expressions of Interest (EoI) were issued last week and a ToR (Terms of Reference) will be out by mid-January 2013 so by the second half of 2014, we should have our own LNG port or terminal. We have already started contacting FSRU ship suppliers so by then we will not be dependent on one supplier. The budget for the jetty itself is US$ 65 million and the national budget will fund that directly as an EPC contract to speed things up.

These are international tenders and we will have international partners to work with us on such projects. Our energy strategy says that Jordan needs about US$15 to 20 billion of investment in the coming 10 years. We cannot fund this alone as the government, so we need international investors and partners such as Total to be part of this.

What sort of impact has the Arab Spring had on the energy sector in Jordan?

Firstly, as a country that imports 97 per cent of its energy needs, the political implications on international oil prices have hit our budget very hard. Buying oil at an average of US$110 a barrel the past year has pushed us to expedite projects to supply energy through alternative sources and preferably national ones; also Jordan has a history of receiving people from neighboring countries. Syrians today account for roughly 5 per cent of our population (250,000 people). Basically, this puts a huge burden on the energy sector and we already have a very high annual percentage increase in electricity consumption (7.4 per cent) so this is why we consume almost all the energy we produce.

With a partner like Total, it will help Jordan meet the national demands for energy, whether in oil products or through other energy sources like renewables and oil shale. Where a lot of international investors understandably would shy away from the region because of the uncertainties, Total stood its ground and I have to commend the team for that.

and cabinet decisions had to be made. We should now have a win-win situation between the government, Total and the consumers.

Will any specific products become more consumed in the future?

Yes, there is a wide spectrum regarding diesel for cars which is banned in Jordan because one, the commodity was heavily subsidised and two, the quality is far away from international standards. So as happens in Europe and elsewhere, it will open new opportunities for car manufacturers and consumers.

In terms of the legal framework, do new laws need to be put in place or old laws revised?

We have been working hand in hand with all the relevant authorities to open up the market. We have a draft law in the legislative council that will completely regulate the market in a better form. We don’t want to reinvent the wheel; we want to follow best international practices.

Over-reliance on importing energy products into Jordan has been a long-standing issue. How important is it for Jordan to be able to provide its own energy needs?

It is very important. The national strategy is to concentrate on national resources and we see a really bright future for Jordan in terms of renewables, such as wind and solar and also oil shale reserves and not forgetting our natural gas potential. Jordan has the fourth largest reserves of gas in the world, equating to about five to seven billion tons of oil. Now, we have agreements with various international companies to develop oil shale production projects in Jordan. So I think we have a better future where we rely more on national resources and less on international markets.

In the past, there have been disruptions to the natural gas pipeline from Egypt. Are there any alternatives?

In the past few years, natural gas supply from Egypt has been declining, reaching only 18 per cent of the


Total’s Marketing & Services activities worldwide – 2011 key figures

15,434 service stations

No. 1 marketer in Africa: nearly 14% market share

3.6 Mb/d of petroleum products sold

The licences of the three companies will create more competition and the level of service will definitely increase.

The future will prove they made the right decision to believe in the country and the best is yet to come.

In early November, there was consumer upset caused by the government’s cut of subsidies. How do you plan to deal with the subsidy issue going forward?

I think it is a thing of the past now. The compensation scheme is testament to that. We have already compensated more than 3.2 million Jordanians and the plan is to compensate roughly four million (70 per cent of Jordanians). So this is something behind us, something that had to be done as hard as it was and it took bold decisions before we achieved that. Slowly, we as the government will get out of the market in terms of pricing oil products monthly and it will alleviate a lot of pressure on the budget.

Total Ghabasheh service station – Amman, Jordan

Source: Total Factbook 2011

Dubai’s Sheikh Zayed Road


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What are the plans for developing Jordan’s energy sector?

We have a new energy law that became permanent in April of this year and we have signed 29 MoUs for 1,000 megawatts (MW) with consortia, roughly 500MW solar and 500MW wind. We have now sent them the draft agreements to be checked. We have also secured roughly US$300 million under the GCC aid programme to Jordan to be invested in solar and wind projects. The plan is to issue EPC tenders and also PPPs to the private sector to own projects in both wind and solar. Next year, we will be really busy focusing on this.

In addition, we have plans to better our storage facilities for oil and oil products. Total shall also invest 20 million Jordanian dinars in this area over the course of the Licence Agreement and the government will also secure US$270 million to be invested in strategic reserves and oil products to increase national storage capacity, in accordance with international standards.

Import of crude oil and petroleum products in Jordan Source: Ministry of Energy and Mineral Resources, Jordan, 2012

Crude Oil

Fuel Oil

LPG

Diesel

Gasoline

4000

3500

3000

2500

2000

1500

1000

500

0 2008 2009 2010 2011

Suzanne Fenton

Suzanne Fenton is a Dubai-

based writer and former

correspondent for FT Merger

Market.

How do you see the importance of the renewable energy sector in Jordan going forward?

I think Jordan especially has great opportunities for both solar, with 315 days of sun [each year] and wind which has speeds of 7-9 metres per second which is very competitive. There is a lot of international support and interest in these projects in Jordan which currently imports more than 97 per cent of its energy needs, since we are not an oil-producing country. It is an indigenous national resource that we are concentrating on. It is also part of our national strategy for renewables to cover at least 10 per cent of Jordan’s energy demand by 2020.

What do you hope your legacy will be to Jordan’s energy sector?

I hope that Jordan catches up with the best international practices in this sector. A lot of countries are facing challenges in energy in the region and elsewhere in the world and so Jordan is not unique in that regard. We have a lot of national resources that, if exploited in the right way and with the right partners, will help Jordan catch up with other countries. Jordan might be an exporter of energy one day and assume a leading role, especially in the region, because of our strategic location connecting the Gulf states with Syria, Turkey and Europe and beyond. So I hope that I will be considered as a person who had an active role in this.

We have a lot of national resources that, if exploited in the right way and with the right partners, will help Jordan catch up with other countries.


TOTAL JORDAN TO SUPPLY ONE-THIRD OF LOCAL RETAIL MARKETInside the Grand Hyatt hotel in Amman, Mehmet Celepoglu sits calmly. As Managing Director for Total Jordan he has played a key role in one of the most important achievements in the history of Jordan’s downstream market

On November 21, Total Jordan, the Marketing & Services subsidiary of Total, signed the Petroleum Distribution and Marketing

Licence with the Jordanian government for 10 years, a significant milestone on a long and at times, tiring journey. The licence means Total Jordan will have the right to supply more than 120 gas stations in addition to the 24 stations it already owns and operates.

Before Jordan can truly celebrate the first step of liberalising its downstream market, a series of other agreements must also be signed, including supply, storage and asset purchase agreements to buy equipment of Jordan Petroleum Refinery Company (JPRC) in dealer owned service stations (DOSS) consisting of mainly pumps. This process will take a couple of months then “a new era will start,” says Celepoglu simply. “But it will not happen overnight; the country is moving from a monopoly towards a liberalised market.”

Ending more than 50 years of monopoly for JPRC, three licensed companies will now supply Jordan’s fuel stations, including Total Jordan, Manaseer and the Oil Marketing Company that JPRC has now to create. Each company will be the exclusive fuel supplier of one third of the retail market for three years.

After three years, other companies will then be able to enter the market. However, Total Jordan plans to convert some of the dealer owned service stations to the Total brand with an additional five-year period, thereby not losing the right to supply after three years. The aim is to consolidate as much as possible in this three-year period. Total Jordan will also transform its existing 24 stations to the new company image T-Air during 2013 and 2014.

Total Jordan will open two stations in December, one in Irbid (in north Jordan) and the other on the notoriously

busy Amman-Zarqa highway which handles more than 50,000 vehicles each day. Total Jordan plans to open more than 10 new company owned and company operated (COCO) stations next year. These new stations will bring the total COCO service stations to more than 35 with about 15 per cent market share of the overall retail network.

The licence also means that Total can not only deliver to service stations but also to wholesale customers from the refinery’s depot or the oil terminal in Aqaba.

Currently, JPRC also controls the aviation fuel market. Total Jordan now plans to enter this market in coordination with Air Total International by participating in tenders to supply jet fuel to both local and international airlines at international airports in Jordan. The new terminal of the Queen Alia International Airport is due to open in the first quarter of 2013 and will boost passenger capacity. After this, tourist numbers to Jordan are also expected to rise, bringing job opportunities and prosperity to the Kingdom.

“We’ve invested heavily in the last five years and between January 2012 (the bid closing date) and the signature of the deal last November, the process was not easy. There were ups and downs several times during intense negotiations, especially in the last three months, but in the end,” Celepoglu shrugs, “as I said to my team, perseverance pays off.” Understatement at its best.

Mehmet Celepoglu, Managing Director, Total Jordan

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One on One with Sheikha Lubna Al Qasimi

FIRST LADY OF FOREIGN TRADE

Her Excellency Sheikha Lubna Al Qasimi is changing perceptions of gender in Arab society and building on the UAE’s impressive status as a global commercial hub. Afaq meets one of the most powerful women in the world

Forbes magazine recently named you the most powerful woman in the Arab world. What was your reaction to this accolade?

It was never my aim to receive such an award. I am motivated to serve my country and working hard is what matters to me most. But of course I didn’t hide my excitement when I received the news. Obviously it is global recognition and I am very happy about this prestigious ranking, which I hope reflects the hard work I have put in over the years. This achievement is a positive reflection on the UAE because it highlights the country’s wise leadership and the progress that has been made towards women empowerment.

Being recognised among the world’s most powerful women is a big step forward and I am pleased to see that the list includes many influential Arab women. The ranking encourages me to continue to serve my country and its leadership.

You’re a passionate advocate of opportunities for women and Emirati women have achieved a great deal in education and business. What has made this progress possible?

Gender equality in the UAE is now a reality and we have overcome many of the prejudices concerning

women in Arab society. The lack of understanding about gender equality in parts of the Arab world can sometimes be attributed to misperceptions of Islamic teaching. Islam only differentiates between men and women in certain situations, and allows them the freedom to work and to run businesses, and sees these activities as integral to the welfare of communities.

The founder of the UAE, His Highness the Late Sheikh Zayed bin Sultan, observed: “Women are a pillar of UAE society, because the woman is the daughter, sister and mother who nurtures and raises the next generation.”

So all of us, men and women, have a responsibility towards the country and the world at large.

I had the honour of being chosen by His Highness the Late Sheikh Zayed as the first female minister of economy in the Arab world but there are a great many Emirati women who have excelled in male-dominated fields, such as the armed forces, the police, and science and engineering.

Her Highness Sheikha Fatima bint Mubarak, affectionately known as the Mother of the Nation, did so much to encourage opportunities for women in various areas and honoured their contributions.

His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice President and Prime Minister of the

UAE and Ruler of Dubai, has also been an inspiration to women, promoting their involvement in so many different areas of the country’s development.

In my opinion, gender equality is synonymous with education, and thanks to the vision of the UAE’s leadership, all UAE nationals receive access to a high standard of education. Both men and women receive scholarships to study the subjects of their choice at the best universities around the world, and such a strong commitment to equal education opportunities should continue.

The UAE has long-standing trade relations with the West but now the economies of Asia are becoming increasingly important. Has this changed the UAE’s perception of partnership with foreign companies?

Since the creation of the UAE federation, our economy has been built on the principle of openness to all countries around the world. This has been the best strategy for development because it provides the most opportunity for investment, trade and joint ventures.

Thanks to this approach the UAE now has a leading position on the world map for trade and investment. And it is important to note that the UAE’s trade ties with Asia have been growing over decades, with the

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Women are a pillar of UAE society, because the woman is the daughter, sister and mother who nurtures and raises the next generation.

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One on One with Sheikha Lubna Al Qasimi

UAE being a major supplier of oil and gas to several countries in the Far East.

Our non-oil trade with Asia has also grown, in areas such as technology, advanced manufacturing and the service sector. But these strengthening ties do not mean we are losing sight of our partnerships with the West. The volume of trade with Western and Asian countries may change but the products are different.

The UAE is a leading trade partner of the United States and we must not forget to mention that the UAE has reached this position through cooperation with the European Union as well.

The presence of multinational companies is a vote of confidence in the UAE as an investment destination while the UAE provides global business a gateway to a regional market of more than 300 million people.

It is important to emphasize that the oil wealth of the UAE has enabled the country to put in place the right strategy to diversify its economy and realise its potential in other sectors. And we appreciate the contribution of international oil companies, some of whom have had a presence here prior to the establishment of the UAE federation.

They have helped establish the model for international partnerships, supporting initiatives like the Petroleum Institute and the Emirates Foundation. They have contributed a lot in the area of corporate social responsibility as well as in the area of sustainability.

What is your outlook for global economic recovery and improved foreign trade? What message would the UAE like to send?

The world economy has witnessed many challenges in recent years. But there are signs of optimism and the resilience of the UAE economy has been a particular bright spot. The situation in Europe is obviously being monitored very closely as recovery in Europe is key to the resumption of global economic growth.

The UAE would like to stress the importance of collaboration between countries and global economic institutions to promote equal opportunities for trade. This is the best strategy to mitigate the effects of the financial crisis. We should intensify efforts to encourage free trade and avoid protectionist policies. That way we can overcome the obstacles to progress in the Doha Round negotiations aimed at lowering world trade barriers and put national economies back on the road to prosperity.

Hopefully, through greater collaboration, the global economy can adopt the necessary strategies to preempt future economic crises. That has been the lesson of the economic downturn, and the UAE has embarked on a number of initiatives to safeguard its economy should a crisis ever occur in the future.

How important are multinational companies in the continued development of the UAE?

Multinationals have a long history in the UAE and we welcome their involvement in a wide spectrum of industries here. Their financial strength exceeds that of some countries and so they are very important in managing the global economy. It is a testament to the UAE’s forward-looking policies that many of these companies have based their regional operations in the Middle East and Africa.

Global confidence in the UAE reflects the attractiveness of the UAE’s investment environment and its strategic location between the economies of the West and the East, as well as the quality of its infrastructure supporting businesses of all types.

UAE Minister of Foreign Trade

Born February 4, 1962

Niece of HH Sheikh Sultan bin Mohamed Al Qasimi, Ruler of Sharjah

Became the first woman to hold a cabinet post in the UAE government when she was appointed Minister of Economy and Planning in November 2004

Has a bachelor’s degree in computer science from California State University and an executive MBA from the University of Sharjah

Began her career as an IT programmer in 1982

Received the ‘Distinguished Government Employee Award’ in 1999 while a senior manager for IT at Dubai Ports Authority

In 2000, appointed CEO of Tejari, a Middle East company promoting e-commerce

In August 2012, ranked 92 on list of the world’s most powerful women by Forbes and most powerful woman in the Arab world

Fact file: Sheikha Lubna bint Khalid bin Sultan Al Qasimi

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The UAE provides global business a gateway to a regional market of more than 300 million people.


The secret to the success of the Dolphin Energy export pipeline, the first ever cross-border gas project in the GCC, has been timing. When

the scheme was first mooted in 1999, the UAE was producing more than enough gas for its domestic consumption, and many questioned the need for a pipeline to import fuel from Qatar.

Over a decade later, with the pipeline up and running, the UAE’s growing population and expanding industrial footprint has left it with an ever-growing gas deficit. The pipeline start-up in 2007 came in the exact year that the UAE began to consume more gas than it was producing, allowing Dolphin Energy to satisfy the country’s gas needs at this crucial tip in the balance. In 2011, it is estimated that the UAE consumed 51 billion

cubic metres (bcm) of natural gas but only produced 22 bcm.

“At the beginning, many people did not appreciate the need for the project. Everybody said that the UAE has plenty of energy and asked why we needed to bring gas from Qatar,” said Ibrahim Al Ansaari, General Manager, Dolphin Energy, UAE. “It is proven now, that even with the imports from Qatar, there is still a shortage of energy in the UAE, and Oman as well. We are now supplying 30 per cent of the UAE demand for gas so really, looking back, if we didn’t have this project the number which we would have to spend on alternative fuel is really horrific – it is billions of dollars.

“The DPSA agreement with the Qataris came at the right time when the demand was increasing in the

Flagships Dolphin Energy

DOLPHIN’S TALES: THE STORY OF A GCC PARTNERSHIP

As the UAE faces a long-term structural gas imbalance, Dolphin Energy has become a vital piece in the country’s energy puzzle. The joint venture’s 364-kilometre subsea export pipeline – the first cross-border project of its kind in the region – has helped the UAE fuel its fast-growing energy demands while Qatar benefits from a stable export route. Total’s partnership with Mubadala Development Company and Occidental Petroleum has provided the planning and know-how to make a success of one of the GCC’s most visionary projects

By Mark Watts

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UAE and we are thankful for the support received from the governments of Qatar, the UAE and Oman. Their guidance was critical and the goodwill they displayed, together with the spirit of cooperation and partnership, has helped make the project a success,” Al Ansaari added.

The challenge of working across borders

Dolphin Energy is 51 per cent owned by Abu Dhabi government investment vehicle Mubadala Development Company, with Total and US-based oil group Occidental Petroleum holding an equal share of the remaining 49 per cent. The Abu Dhabi-based company has played a key role in the development of gas infrastructure in

the GCC, linking together the gas networks of three member states: Qatar, the UAE and Oman.

Dolphin Energy sources its gas from Qatar’s North Field – the largest non-associated natural gas field in the world – which is piped to the company’s gas processing and compression plant at Ras Laffan Industrial City.

Condensate, liquefied petroleum gas (LPG), ethane and sulphur are then extracted and sold, and the processed natural gas is exported via a 364-kilometre, 48-inch offshore pipeline to the Taweelah Receiving Facilities in the emirate of Abu Dhabi. The pipeline was built with a capacity to transport 3.2 billion cubic feet a day (bcf/d), with Dolphin signing a long-term development and production-sharing agreement with

Dolphin Energy is producing and transporting sweet gas from the 24 deep wells drilled in Qatar’s North Field



Qatar Petroleum to import 2 bcf/d from Qatar.“Being the first pipeline to cross countries was a

major challenge,” said Al Ansaari. “We needed to coordinate between Qatar and the UAE and get all the environmental authorities’ approvals while crossing so many facilities: shipping channels, oil pipelines, gas pipelines, environmentally sensitive areas and a zone very congested with oil and gas facilities around Das Island.”

“It was a big challenge coordinating all these efforts and keeping the project moving towards completion. We had to change the route of the pipelines in certain areas to avoid impacting the environment and marine habitats … including an area where turtles lay eggs off the Qatari coast,” he added.

From Taweelah, Dolphin Energy distributes gas throughout the UAE and across the border to Oman, which has been contracted 200 million cf/d of the Qatari gas. The company has 25-year gas supply agreements with Abu Dhabi Water & Electricity Company (ADWEC), and Dubai Supply Authority (DUSUP), which is distributed via several domestic pipelines built or leased by Dolphin Energy throughout the UAE. “In addition to the 2 billion cf/d of Dolphin Energy’s own production, we are also supplying third party gas to Fujairah, Sharjah and Ras Al Khaimah,” Al Ansaari added.

The most recent project to be completed by Dolphin Energy was the 244-kilometre Taweelah to Fujairah pipeline (TFP), to fuel the east-coast emirate’s expanding

gas demand. The TFP was built with a capacity of 1.6 bcf and is able to meet ADWEC’s requirements at its Fujairah 1 and 2 power and desalination plants. The project was required as the existing Al Ain to Fujairah pipeline (AFP) has a much smaller capacity and was not able to meet the needs of ADWEC’s Fujairah plans.

“We had the approval of the right of way… across four emirates – Abu Dhabi, Sharjah, Ras Al Khaimah, Fujairah – so we had to take all the approvals and the environmental impact assessment for the whole route. And we had to work across two different terrains, the desert as well as the mountainous area,” said Al Ansaari.

The engineering, procurement and construction contract (EPC) for the TFP project was awarded to Russian group Stroytransgaz in July 2008 and was completed on schedule in November 2010. Al Ansaari said that hiring the first ever Russian contractor to carry out a major energy project in the UAE came with its own difficulties.

“The challenge was the different culture in addition

We needed to coordinate between Qatar and the UAE and get all the environmental authorities’ approvals while crossing so many facilities.

Ibrahim Al Ansaari, General Manager, Dolphin Energy, UAE

experience in oil and gas, so that has been a real blessing for the project. Total has complemented Mubadala’s experience in the UAE with its relationship with the government of Qatar, so in combining these experiences it has helped a lot in reaching the targets for the project.”

Total is not only involved in the management of the company but through training Dolphin Energy’s young Emirati and Qatari employees, is also helping develop the skills of local workers in the two GCC member countries. Dolphin Energy is also involved in the Total’s MBA scheme, which takes two Dolphin Energy employees each year on a scholarship programme with prestigious French universities. Six employees have already graduated from the programme, which has made a strong contribution to the company’s skills base. As with many companies with government ownership

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to the challenges in communication – we didn’t speak Russian and their staff hardly spoke English. They also had different procedures and there were changes within their company at that time. But we finally completed the project on time and below budget,” Al Ansaari said.

Looking to future expansionThe next target for Dolphin Energy is the completion of

a project to add three extra compressors to complement the existing six. The scheme is expected to be completed by the end of 2014, using gas turbines supplied by UK-based Rolls-Royce as part of a US$136m deal agreed in May 2012. “The State of Qatar has put a moratorium on any additional concessions for now. If the moratorium is lifted and an agreement is reached for another bcf or

more, then our systems are ready to export that gas,” said Al Ansaari.

Total was involved in the Dolphin Gas Project right from the start and was the first group to sign a partnership agreement with Abu Dhabi to build the project. The company helped oversee the feasibility study and front-end engineering design (FEED) phase of the project and supported the technical aspects of all phases. Occidental Petroleum joined the project later on after the US-based Enron Corporation pulled out of the joint venture in 2001.

“We used Total’s specifications for the whole project and during the commissioning we had this partner available and we utilised its laboratories in testing different chemicals for the pipelines,” explained Al Ansaari. “Total has enriched the whole project with their vast

The route of the 244km Taweelah-Fujairah pipeline (TFP) crosses desert and mountains


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in the UAE and Qatar, Dolphin Energy is aiming to increase the number of nationals on its workforce, targeting 50 per cent in the UAE and 35 per cent in Qatar by the end of 2013.

“In the UAE we are at 47 per cent and in Qatar at about 33 per cent. It is a challenge when you consider the number of locals in both countries. There are so many companies who demand nationals, and the market is very small. We are well-known today and the prospect of working for us attracts more and more young graduates. Our task is to train them efficiently and keep them in the company,” said Al Ansaari.

DOLPHIN ROLLS OUT PROCESSING EXPANSION

What advantage does the deal with Rolls Royce for technology and long-

term services give to the future of Dolphin Energy’s facilities?

Export gas supply from Dolphin Energy’s Ras Laffan gas processing plant to the UAE and Oman depends on the availability of the Export Gas Compression facility. We took the strategic decision to engage Rolls Royce and benefit from their expertise in handling EGC packages so that we could ensure the required reliability and availability. Today, this partnership ensures sustainable export gas supply so that Dolphin Energy can fulfill its commitments to customers in the UAE and Oman.

How have the initial six units performed since Dolphin’s Ras Laffan operations started up?

Like all new operators, there were challenges when we first started. However, we have built a strong and transparent partnership with Rolls Royce over the years which has definitely helped sustain the overall availability of the current facility. The average annual availability of the facility has been at 99 per cent for more than two years.

What does the long-term equipment service agreement cover?

The original Long Term Service Agreement or LTSA includes the supply of spare parts, consumables, and field service manpower necessary to carry all planned and unplanned

turbines under the same parts and services agreement.

The Gas Processing and Compression Plant at Ras Laffan is the world’s largest single build plant in the world. Are there any unique challenges in running such a large-scale operation?

First, we couldn’t run such a large scale operation without the senior management team we have, the team work and dedication of our employees or the support provided by our shareholders and partners.

Second, the safety of our team and assets is and will continue to be our main focus. Managing such a large facility requires the best operations team, able to manage a large number of equipment and processes and large international, multi-discipline teams working together to ensure we meet our yearly production targets safely.

Additionally, Dolphin Energy is one of a few large pipeline export gas operators in the region. This puts even more pressure on us to achieve availability and reliability of our assets so that we meet our pipeline export gas commitments on an hourly, daily and annual basis. This is particularly striking when you consider we operate in a region very familiar with the LNG industry which enjoys storage capacity based on availability of its exports.

Dolphin Energy was also the first cross border initiative in the region to cross three GCC nations. This was another new interesting challenge that was overcome.

maintenance activities at site for six packages. It also includes comprehensive mid-life and end-of-life overhauls of the packages when the required running hours are achieved.

In addition to enhancing the Ras Laffan export facilities, Dolphin Energy is also focusing on improving its environmental footprint and maintaining equipment and facilities to optimise its existing operations. The company’s flaring and greenhouse gas emissions dropped by 26 per cent and 4.7 per cent respectively in 2011.

The success of Dolphin Energy has been built on partnerships, not only between the country’s three shareholders but between the three countries that have benefitted from its infrastructure. With the help of Dolphin Energy and its shareholders, the Gulf region has managed to benefit from rare joint effort in developing the region’s energy infrastructure, which could pave the way for future cooperation in the GCC and beyond.

Managing such a large facility requires the best operations team, able to manage a large number of equipment and processes.

Dolphin’s Gas Processing Plant at Ras Laffan, Qatar

In May 2012 Dolphin Energy awarded a second contract to Rolls Royce to supply gas turbines at the Ras Laffan gas processing operations in Qatar. Hassan Al Emadi, Vice President Operations, Qatar, Dolphin Energy, explains how the companies’ strategic partnership has contributed to the success of the project

Hassan Al Emadi, VP Qatar Operations, Dolphin Energy

Furthermore, the LTSA includes full technical support from the Rolls Royce remote design and technical support offices as well as site technical support when needed to help understand and resolve all EGC operating challenges.

As part of this contract, Rolls Royce guarantees the average yearly availability of the EGC package to meet or exceed 98.5 per cent against commercial terms.

A revised LTSA was also developed and signed with Rolls Royce to renew the contract once it expires in 2014 to include additional compression packages planned to be commissioned in 2014 and two spare gas

QATAR

Ras Laffan

Abu Dhabi

Taweelah

Sharjah

Dubai

Jebel Ali

Existing PipelinesDolphin Constructed Pipeline

MaqtaAl Ain

Oman

Fujairah

UAE

Doha

About Mark Watts

Mark Watts is the Abu Dhabi

correspondent of the energy

and industry periodical MEED.

Dolphin gas project



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What was behind Total’s decision to join Dolphin Energy?

Total joined the project very early and for us it was extremely important to be one of the main players in the first cross-regional development for the transportation of energy in the GCC. The agreement between Abu Dhabi and Qatar was quite forward-looking at that time, both in terms of linking three GCC countries and in Abu Dhabi’s good observation of its future gas needs.

What do you think Total has brought to the partnership?

Dolphin was a huge development in terms of investment and the amount of resources that needed to be mobilised, so the company brought its management capabilities of complex projects. Total contributed to define the scope then to engineer and construct it. In fact, the Dolphin project is three major projects in one – the offshore production platforms, the gas treatment plant and the export pipeline – and we have a strong reputation globally in all of these areas.

Did it help that Total was already active in both Qatar and the UAE?

We were already involved in Qatar offshore production and the corresponding liquefaction plant onshore, and Total has worldwide experience of large offshore projects. In Qatar, we also have experience in gas treatment facilities and we have a large conventional pipeline project know-how, both onshore and offshore. On the other side, we are present in Abu Dhabi in many different ventures and are

A VISIONARY PROJECTArnaud Breuillac, Total’s President of Middle East Exploration and Production, explains what Total has brought to the Dolphin Energy partnership and why it is such a unique project in the group’s Middle East portfolio

Arnaud Breuillac, Total’s President of Middle East Exploration and Production

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one of the companies most aware of the gas equation that the UAE is facing. Total believed that the project would benefit all parties involved and had the financial and technical capabilities to help carry it out.

How has Total’s role changed since the project came on stream in 2007?

At the very beginning of the project, Dolphin Energy was to be created from nothing, so we provided, along with the other partners, a lot of the manpower and mobilised a number of staff. More than 10 years after the launch of this project and, almost five years after the production started, Dolphin is now very much a company of its own. Total’s contribution will continue to follow the good management of Dolphin Energy through our presence on the board but also by providing a few senior managers who are still working within Dolphin Energy. Our involvement is much more to look after our position as a shareholder and make sure Dolphin Energy continues to develop in the best possible way.

Do you think there is the potential to expand Dolphin Energy?

The project has the potential for a capacity increase of 1 billion cubic feet a day. We have just launched a programme to expand the compression facilities that will provide this capacity, but for now we are lacking the gas supply from Qatar. This is because Qatar has placed a moratorium on gas development on the North Field until 2014 and has not yet decided how they want develop the resource in the future.

The discussions between Dolphin Energy and Qatar on additional gas volumes have never stopped, and started when the original contract’s ink was not even dry. Although price is an important factor in the negotiations, it also comes down to Qatar’s strategy on the long-term use of its gas reserves.

Is there any potential for other cross-border gas pipelines in the GCC?

Kuwait, Saudi Arabia and the UAE all have structural natural gas deficits which are driving them to developing more challenging upstream projects such as tight gas and sour gas. Qatar is the only GCC country that has potential gas exports for many years to come. Kuwait can now import liquefied natural gas (LNG), but an alternative to this might be building infrastructure like the Dolphin Energy pipeline.

How important is Dolphin Energy to Total’s Middle East operations?

We are involved in many different ventures in Abu Dhabi and Qatar both in oil and gas and downstream refining and chemicals industries. In all these ventures, Dolphin Energy has a special position because of its unique nature. It is the only project of its kind that we can call a visionary project when it was decided. We have built a strong relationship with Mubadala over the years and they joined us in exploration ventures in Malaysia. It is the beginning of a very strong partnership that we hope will develop over the years, not only in the UAE, but in many different areas.Dolphin Energy’s Taweelah Receiving Facility in Abu Dhabi


Personal, local, global TEP Yemen

TEAMWORK ACROSS BORDERSThe strength of Total’s operations in Yemen, now marking their 25th year, remains a cause for optimism in a country clouded by uncertainty. And as Afaq discovered, close cooperation between the different offices of Total E&P Yemen is ensuring the success story will continue long into the future.

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An ultra-modern office suite on Dubai’s Sheikh Zayed Road is the unlikely setting for an interview with the head of Total’s operations

in one of the Arab world’s oldest countries.Behind a wide desk sits Hatem Nuseibeh, Managing

Director of Exploration & Production and Group representative in Yemen, smart-phone close at hand to stay in constant touch with colleagues in the field.

A Total veteran, Nuseibeh is used to demanding assignments. The 57-year-old’s latest “adventure”, as he describes it, follows senior management roles in Libya, Nigeria and Syria.

The UAE connection illustrates the strength of Total’s regional network. The Dubai office of Total E&P Yemen is helping to ensure operations continue to run smoothly in the country despite the widely reported challenges there.

Active in Yemen since 1987, Total remains the country’s biggest industrial partner, with interests spanning exploration, oil production and liquefied natural gas.

“This year we are celebrating 25 years in Yemen,” says Nuseibeh, who spends the majority of his time in Sana’a, the Yemeni capital.

“We are the biggest company and the largest investor, and the only international company which continued operations normally in 2011. We did not close for one day – and what is amazing is that 2011 was an excellent year from an operational point of

view, in terms of production and cost efficiency. This shows that we have a good team and our people are really dedicated to their work.”

Total has interests in Yemen’s two main oil-producing regions, located in the centre and east of the country – Block 10 in the Masila Basin in Hadramout province and Block 5 in the Marib Basin – besides a number of exploration licences.

The US$4.5 billion Yemen LNG joint venture, in which Total is a 39.62 per cent partner, produces gas at Block 18 in the northern Marib Basin for export from the Balhaf terminal on the Indian Ocean.

“We have four main things to do,” says Nuseibeh, a French national of Palestinian descent. “We are partners in some operating blocks, we operate Block 10, and we have exploration activities. We also follow up Total’s interests in Yemen LNG.”

Such a sizeable commitment to Yemen inevitably poses security risks. TEP Yemen has more than 700 employees, and the company’s Block 10 base in Kharir indirectly supports a workforce exceeding 3,000. A fatal attack in Hadramout province in May 2012 tested the resolve of both Total’s Yemeni and expatriate staff.

“What happened this year showed that you can never over state security – you must always have a zero tolerance policy,” Nuseibeh continues.

“We took the decision to start decreasing the number of expatriates in Sana’a in late 2010. We saw


Block 10 – Kharir Base, Yemen


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things would get worse before they got better, so we moved some people to the field and others to Dubai.”

The orderly surroundings of Total’s futuristic office high up Dubai’s Monarch Tower betray few signs of the large-scale relocation effort.

“Most of our employees are from Yemen but we have a very mixed team. It took us only nine days to set up a fully operational office in Dubai and accommodate around 30 families. That says a lot about the UAE but it is also a credit to the team.”

On the moveGeophysicist Armelle Laurent was among the

expatriate employees relocated to Dubai. Events unfolded very quickly.

“The decision was taken on a Monday morning and by the next day I was on a flight to Dubai. We packed what was essential and went. When we first moved, we didn’t expect to be away for very long. We thought it would be for six months, until the situation in Yemen had calmed down.”

But while the comforts of Dubai are welcome, Laurent misses life in the Yemeni capital.

“Yemen is one of the nicest countries I’ve been to. It has so much history and when you’re in Sana’a, you can really feel that. Life is more complicated, of course, you don’t have everything you want like in Dubai, but the atmosphere is different. And Yemeni people are the gentlest people I’ve ever met.”

Part of a four-strong exploration team, Laurent analyses seismic data to identify viable oil deposits deep below ground, much in the same way as a radiologist interprets images of the human body to diagnose and treat disease.

“The drilling environment is difficult because we’re working with impermeable basement rock, the last layer of rock,” says Laurent whose husband also works with TEP Yemen in Dubai. “We’re looking for fractures where oil may be trapped, but it’s very deep and very difficult to see.”

Effective analysis is a mix of hard science and human judgement.

“Even though we are scientists, what we are doing is interpretation. That means we can have a completely different interpretation than our partners of the same area using the same data. So you have to discuss, explain your arguments and find a joint solution.”

Total’s strengths in technology are a valuable asset and help streamline communications between teams in different locations, including those out in the field.

“When my team or my manager is in Sana’a, we use a chat tool to discuss issues with different people

and share documents,” says Laurent, who spent two years with Total in Nigeria before a nine-month stint in Sana’a. “We also use video-conference facilities and software for seismic data that is very powerful. Total is a big company so we have more facilities than the smaller operators. But we all work as a team.”

The security situation in recent months has limited exploratory drilling and the acquisition of vital research data. But Laurent is quietly confident that Total’s exploration blocks in Yemen will bear fruit and has as much affection for the country as ever.

“I chose this job to be able to work all over the world and I was very excited to go to Yemen. When people talk about certain countries, they only have the bad things in mind. But as soon as you go there you realise that it’s not the truth; it’s just one small part.”

Staying the courseMichel Hajjar, Finance Manager at Total E&P in

Yemen, keeps a close watch on standards. Based in Yemen since 2008, first as head of budgeting at Yemen LNG, he says the operational challenges of recent months have not compromised best practice.

“The difficulties don’t stop us from following the company rules or operating complete transparency. We follow partner and group level audits and don’t tolerate any mistake. And because of the quality of the personnel, we have been able to make all the accounts transparent and accurate.”

The redeployment of staff to Dubai in early 2011 caused inevitable upheaval but everyone has adjusted well, he insists.

“We didn’t set up the Dubai operation to work separately. We have some people in Dubai doing jobs for Sana’a and some in Sana’a doing jobs for Dubai. But we are working in alignment. The weekends in the UAE are different from Yemen and there’s an hour time difference, but we are used to it now.”

Hajjar manages a team of 60 accountants and financial analysts and is now the only French national in his department in Yemen.

“We are all the same in terms of dedication; we love what we’re doing and work towards the same objectives. We have no differences and the one common language at Total is the company rules. Having a different nationality and speaking a different mother tongue doesn’t change anything.”

Approaching five years in Yemen, Hajjar is less sanguine about being separated from family, but regular visits to global headquarters allow him to see his loved ones in Beirut on the trips to and from Paris.

And like his colleagues in other departments, Hajjar

Omar Al KulaibyDesignation goes here

We are the only international company which continued operations normally in 2011. We did not close for one day.

1. Hatem Nuseibeh

2. Omar Al Kulaiby

3. Michel Hajjar

4. Abdullah Al Thawr

5. Cecile Haag

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3

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has developed an attachment to Yemen and its people. Respecting the local culture, he says, is essential for successful operations in the country. Promoting local talents also helps to bridge the communications divide.

“We have put in place a strong training programme and there are Yemenis who have been promoted to managerial positions already. In the finance department they are young but very capable.”

A local role modelOmar Al Kulaiby, TEP Yemen’s Contracts and

Procurement Manager, is a role model for those Yemenis starting out on an oil and gas career. He joined the company in 1999 straight from college, and was appointed head of procurement at Total’s Qatar affiliate in 2007. He returned to TEP Yemen to run its contracts department in late 2009, before earning his latest promotion in September last year. His current responsibilities include ensuring the company’s procurement activities comply with Total’s strict health, safety and environmental guidelines.

Al Kulaiby lists training among the highlights of his 13 years at Total.

“I had my first training in contracts, procurement and tenders in early 2001, and since then I’ve done various specialised programmes. I’ve also had lots of training in health and safety; in fact, I recently finished a three-day HSE course for managers in Doha.”

As a Yemeni national, Al Kulaiby has inevitably been affected by the political turmoil in the country. Considering his day job involves the purchasing of everything from stationery to rig equipment, for the affiliate’s different sites and operations across Yemen, the disorder has also made its presence felt at work. Like so many of his countrymen, Al Kulaiby has risen to the challenge.

“I’m in charge of procuring materials and services to meet tight deadlines. Last year we had to finalise a contract for a charter flight from Dubai to Seyoun

achievement.”In the field

Cecile Haag is a member of the team at Block 10, a long-standing oilfield situated more than 600 kilometres to the east of Sana’a. An experienced process engineer, she is unfazed by assignments in remote corners of the world, and takes the male-dominated work environment in her stride.

“I was wondering how people might react to a woman boss, but in the end it was very easy,” she says. “We have a good relationship and everything is quite balanced.”

Haag is responsible for the water injection activities needed to maintain output from the field’s ageing oil wells, as well as the chemical processes used in oil extraction. Overseeing more than 30 wells across a large geographical area is a demanding job, while coordinating with colleagues in Sana’a and Dubai can throw up logistical challenges. Adaptability is the key ingredient for success.

“You have to be able to accept new challenges, new ways of working, different facilities and different styles of management,” says Haag. “You really have to love it. It’s a challenge but also quite exciting and each time you learn something new.”

The international make-up of the team also appeals to Haag. And the four-weeks-on, four-weeks-off work rotation system allows for more quality time with family back in France, she says.

“It’s a good thing that you can work with people from Latin America, Europe, as well as Yemenis. Sometimes communicating can be difficult, but it’s a very rich experience. There are people of different ages, backgrounds, cultures – it’s a very interesting mix, and that helps you improve in many ways.”

Total’s next generationBenefitting from Haag’s rich experience is Abdullah Al

Thawr, a young Yemeni graduate who recently earned

a first-class degree in the UK on a Total scholarship. The fresh-faced chemical engineer was assigned to Block 10 in August.

“It was challenging to get the hang of things on my first rotation,” he says. “This is my second rotation after training and third in total, so now I’m getting used to it. My job is a mixture of technical and non-technical responsibilities, including administration and management tasks. I’m the contact point between different departments, and I also work with the laboratory and chemical team. It’s a challenging position but you get to do different things every day.”

A typical day for Al Thawr starts at 6:30am with a briefing by the head of department.

“On a busy day I’ll probably have three or four meetings, on planning, HSE or technical issues with our partners. Whenever I have time I do a tour of the field, visiting the wells.”

Al Thawr manages four colleagues in the laboratory and chemical team. “They do a great job which makes mine much easier,” he says.

Being closer to family after four years of studying abroad is a welcome change for Al Thawr and he values the opportunity to gain industry experience from Total.

“Working with Total gives me a chance to have a good start in my career,” he says. “They are one of the big companies in Yemen and they have managed the situation here in the last two years very well. I’m grateful to have received a scholarship from Total, so naturally I think positively about the company.”

Al Thawr is cautiously optimistic about the future and says life in Yemen has improved over the last year. Working in the oil sector allows him to contribute to the country’s reconstruction.

“It helps to know that the work you do is promoting development in your country and giving something back to the community.”


32 33

You have to be able to accept new challenges, new ways of working, different facilities and different styles of management.

during Ramadan at very short notice. It was very challenging. So we’ve learnt to work at a faster pace, to obtain proposals, to arrange internal validation, while continuing to optimise quality and manage costs.”

Migrating from paper-based to online procurement systems has helped to bridge the communications gap between the offices in the UAE and Yemen, as have

Block 10 production 1997-2011Total in Yemen

Block 10Block 71

Block 72

Yemen LNG project

Block 5

Block 70

Block 3

YEMEN

SAUDI ARABIA

Sana’a

Production

Exploration

LNG Production 1997 1999 2001 2003 2005 2007 2009 2011

90

80

70

60

50

40

30

20

10

0

Kb/d

Kb/d: Thousand barrel per daySanaa at night

audio- and video-conference calls.“All the internal requests, like approval slips, and all

those other documents that used to be on paper are now on the e-system,” says Al Kulaiby, who manages a 30-strong team. “The good thing about my team is that all my colleagues in the Sana’a office are Yemeni. I am lucky to have my people around me. I’m proud that we are able to deliver all materials on site without delay and put in place different types of contracts, no matter the challenge. It shows that we can really work under pressure.”

Amidst the unrest of 2011 and early 2012, TEP Yemen’s operations at Block 10 reached an output of more than 80,000 barrels of oil equivalent per day, its highest to date. For Al Kulaiby, the milestone is a further reminder of the tangible benefits the company delivers to the local economy.

“We can all be very proud of being part of this

17%

17%

17%

IndonesiaAcquisition of two offshore blocks

In October, Total signed two Production Sharing Contracts (PSCs) with the government of Indonesia for the Telen and the Bengkulu I - Mentawai exploration blocks. Total will hold a 100 per cent interest in both offshore blocks. Within the first three years, Total plans to drill an exploration well in the Telen block as well as perform a 3D seismic study of the Bengkulu I - Mentawai block.

Ahead of scheduleIn early November, Total announced that its gas

condensate project in Indonesia’s South Mahakam offshore field has been completed two months ahead of schedule. In partnership with Japan’s INPEX Corporation, the project is expected to produce an average of 70,000 barrels of oil equivalent per day by the end of 2013.

Kazakhstan Caspian expansion

In November, Total acquired a 75 per cent stake in two exploration blocks from Kazakh Company Nurmunai Petrogas LLP. The “North” and “South” onshore blocks cover an area of approximately 14,500 square kilometres in

south-west Kazakhstan. As the new operator of the licences, Total will acquire seismic data and subsequently drill a well in 2013.

35

At a glance World News

Strong financial resultsIn October, Total announced adjusted net income of

3.3 billion euros for the third quarter of 2012, an increase of 20 per cent compared to the third quarter of 2011, reflecting a strong performance across all segments. The outlook for sustained growth in Upstream remains positive as new operations continue to ramp up and progress in the development of various major projects gathers pace. The third quarter also saw a sharp increase in refining margins, with the Refining & Chemicals division recording 54 per cent growth.

Africa

ItalyTempa Rossa

Total has launched the Tempa Rossa field development. Due to come on stream in early 2016, the field is expected to produce 50,000 barrels of oil per day at plateau, along with 230,000 cubic metres of natural gas and 240 metric tons of LPG. With a 75 per cent stake Total is the operator of the field, located in the southern Apennines at an altitude of 1,000 metres.

NorwayAtla on stream

The Atla gas condensate field in the Norwegian North Sea is now on stream, two years after the completion of exploration drilling. Total is the field’s operator with a 40 per cent interest.

BulgariaBlack Sea opportunity

Total is partnering with OMV of Austria and Spain’s Repsol to explore off the coast of Bulgaria at depths of up to 2,000 metres. Total will take a 40 per cent share in the Khan Asparuh licence, with OMV and Repsol each having 30 per cent.

Going solarTotal is expanding distribution of an innovative and

reliable product line designed to help off-grid, low-income communities meet some of their most basic everyday needs. ‘Awango by Total’ comprises lighting and phone charging equipment powered by solar energy. So far more than 125,000 of the novel solar kits have been sold in Cameroon, Indonesia, Kenya and the Republic of Congo. Development is now being stepped up in eight more countries: Burkina Faso, Nigeria, Senegal, Uganda, Ethiopia, Haiti, Myanmar and Cambodia. The goal is to sell one million solar lamps by 2015, which will improve the living standards of five million people.

PhilippinesExploration effort stepped up

Total has signed an agreement with Kuala Lumpur-based Mitra Energy to acquire a 75 per cent interest in Block SC56, located in the Sulu Sea, further expanding Total’s exploration efforts in the Asia Pacific region. Mitra will initially operate the seismic works, after which the operatorship will be transferred to Total for the drilling operations.

AustraliaBigger stake in Ichthys

Total has increased its stake in the Ichthys liquefied natural gas (LNG) project in Australia’s Northern Territory from 24 per cent to 30 per cent, buying the additional share from its partner INPEX Corporation. The first production from the project is slated for the end of 2016, with Total already committed to buying 900,000 tons of LNG per year.

Papua New GuineaHigh-potential gas discoveries

Total has signed licences with Oil Search Limited for five blocks in the Gulf of Papua. Total has a 40 per cent interest in the offshore licenses PPL 234 and PPL 244, a 50 per cent interest in the PRL 10 offshore license, and the option to buy a 35 per cent stake in the onshore licenses PPL 338 and PPL 339. Total and Oil Search Limited have also formed a strategic partnership to assess other opportunities in Papua New Guinea.

MyanmarNew offshore opportunity

Total has agreed with Thailand’s PTTEP to acquire a 40 per cent interest in Myanmar’s Block M-11, situated in the Martaban basin. PTTEP, operator of the block, plans to drill its first well by the third quarter of 2013.

KAZAKHSTAN

CASPIAN SEA

ARAL SEA

SOUTH BLOCKNORTH BLOCK

NigeriaTotal sells its interest in OML 138

Total has sold its 20 per cent share in the OML 138 block, which contains the Usan field, to China Petrochemical Corporation (Sinopec). Yves-Louis Darricarrère, President of Upstream at Total, said the US$2.5 billion sale of the offshore oil asset, where Total operated in a minority position, would enable a better focus on material growth opportunities in the Group’s African portfolio.

MozambiqueStronger presence in eastern Africa

Total is building on its activities in East Africa, following an agreement with Petronas of Malaysia to acquire a 40 per cent stake in its Production Sharing Contract covering the offshore blocks 3 and 6 in Mozambique’s Rovuma Basin. An exploration well is planned by year-end.

34

Rangoon, Myanmar


Corporate

Europe

Asia-Pacific

Note: information as of November 30, 2012

Strong presence at Adipec

36 37

At a glance Middle East News

Total ABK receives royal guestHis Highness Sheikh Abdullah bin Zayed Al Nahyan, Foreign

Minister of the UAE, toured the Total-operated offshore oil and gas platform Abu Al Bukhoosh (ABK) on November 29 as part of the UAE’s National Day celebrations.

Sheikh Abdullah was accompanied by Arnaud Breuillac, Total’s President Middle East; Jean-Luc Guiziou, President of Total UAE; Amer Al Shaikh Ali, General Manager and Site Manager of Total ABK; Philippe Roy, UAE Representative of Total Group; and Sultan Al-Hajji, Vice-President of Total UAE.

The delegation toured the offshore platform’s central complex and control room, where Sheikh Abdullah chatted with UAE national employees as well as local graduates of the Total ABK Academy completing on-the-job training at the facility.

UAE

Jordan

Qatar

Iraq

Saudi Arabia

LebanonYemen

Total receives Yemen president in Paris

The President of Yemen, His Excellency Abdu Rabu Mansoor Hadi, was Total’s guest of honour in Paris in October. Accompanied by a delegation of senior government officials on a state visit to France, Yemen’s president met with Christophe de Margerie, Total’s CEO and Chairman, and members of the company’s board of directors. The high-level talks dealt with steps to ensure the security of oil and gas workers in Yemen, global trends in oil and gas markets, and opportunities for further collaboration between Total and Yemen.

Scholarship programme launched

Total E&P Yemen has unveiled its Graduate Scholarship Programme for 2013. Under the scheme, local students are invited to apply for scholarships to study bachelor degrees in petroleum engineering, chemical engineering and earth sciences at leading universities in France and the UK.

Yemeni students head to FranceYemen LNG, the consortium in which Total is

a 39.62 per cent shareholder, has awarded 25 local students scholarships to study bachelor and master degrees in France. A total of 60 students are now studying there as part of the Yemen LNG initiative.

Qapco achieves new milestoneOn November 20, Qapco, in which Total

has a 20 per cent interest, inaugurated its new low density polyethylene plant, LDPE 3, in Mesaieed. The Emir of Qatar, HH Sheikh Hamad bin Khalifa Al Thani, Qapco’s senior management and Patrick Pouyanné, Total’s President for Refining & Chemicals, attended the ceremony. At peak capacity, LDPE 3 will produce 300,000 metric tons of low density polyethylene per year. Combined with Qapco’s existing LDPE facilities, the additional capacity will increase Qatar’s total LDPE output per annum to 700,000 metric tons. The new plant will primarily serve the fast-growing markets of Asia.

Total renews Al Khalij licence Total will continue to be the operator of the

Al Khalij offshore oilfield in Qatar for another 25 years. His Excellency Dr Mohammed bin Saleh Al Sada, Qatar’s Minister of Energy and Industry and Chairman and Managing Director of Qatar Petroleum, signed a Heads of Agreement (HOA) to formalise the extension with Yves-Louis Darricarrère, President of Total’s Upstream division, on November 14. Under the new HOA, Qatar Petroleum and Total will have a 60/40 interest in the field following the expiry of the existing exploration and production sharing agreement in 2014.

Halfaya reaches 100,000 b/d Production at the Halfaya oilfield in south-east Iraq reached 100,000 barrels per day in September, 30,000 barrels above the contracted target for the first phase of the field’s development. Total has an 18.75 per

cent stake in the consortium led by PetroChina, which signed a 20-year development and production sharing contact with state-owned Missan Oil Company in January 2010.

Exploration in KurdistanTotal has acquired shares in two exploration

blocks in the Kurdistan region of Iraq following a farm-in agreement with Marathon Oil Corporation. Total will take a 35 per cent interest in the Harir and Safen blocks, operating the latter. The Safen licence covers an area of 424 square kilometres.

Journalists tour Jubail refinerySaudi Aramco Total Refining and

Petrochemical Company (SATORP), in which Total holds a 37.5 per cent interest, invited French and Belgian media to tour its flagship refinery currently under construction in Jubail

Stepping on the gasTotal has acquired a 10-year

petroleum product distribution licence in Jordan that will allow its local Marketing & Services subsidiary, Total Jordan, to significantly expand its operations in the country. As part of the agreement, Total will supply more than 120 service stations, in addition to its 24 company-owned and operated outlets, representing a 33 per cent share of Jordan’s retail market. The new licence will also boost Total’s trading activities in the corporate and industrial sector and create opportunities in Jordan’s aviation fuel sector.

Environmental protection skills on show

Before an invited audience of media and local dignitaries, Total Lebanon held an emergency drill at its Dora warehouse facility on September 19 to demonstrate procedures for fighting marine pollution. The exercise was intended to show the importance of maintaining the highest level of readiness to respond to environmental threats.

on Saudi Arabia’s north-east coast in October. When fully commissioned at the end of 2013, the facility will treat 400,000 barrels of heavy crude per day, producing gasoline and other refined products for local and international markets.

Total underlined its partnership with the UAE emirate of Abu Dhabi with a significant presence at the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC) in November. A 40-strong speaker delegation led by Total Chairman and CEO Christophe de Margerie participated in the event’s conference, while a two-floor exhibition stand covering 200 square metres displayed Total’s latest technologies in oil and gas exploration and production, as well as its activities in education, training, arts and culture and sport.

Student excellenceSponsored by Total UAE, four students

from the Masdar Institute of Science and Technology travelled to Canada to participate in the Alberta Energy Challenge in September. It was the first time a team from the Middle East had participated in the annual business contest.

Total picks up two industry awards

Partners ADNOC and Total, operator of the Abu Al Bukhoosh Field offshore field in Abu Dhabi, have been celebrating their success at the Oil & Gas Middle East Awards, held on November 27 in Dubai. Total ABK, represented by Geosciences Manager, Adrian Pearce, scooped the trophy for “Best International Collaboration of the Year” at the gala dinner hosted by ITP Business, as well as the “Enhanced Hydrocarbon Recovery Project” award for its full-field management programme at Abu Al Bukhoosh.


38 39

At a glance Did you know?


10 trends to watchThe International Energy Agency released the 2012 edition of its World Energy Outlook in November. Here is a snapshot of some of the key findings

World’s energy sources in 2035

Hydrocarbons hold sway

Leading the fieldThe IEA predicts that oil will still be the largest energy source by 2035

Oil remains the economic cornerstone of a number of Middle East countries, nowhere more so than Iraq

The IEA says Iraq will account for 45% of the total growth in global oil production between 2011 and 2035, making it the world’s second largest oil exporter

Iraq 45%

Non-Opec 12%

Rest of Opec42%

2724 25

11

74

3

Oil export revenuesGDP

%

Oil Natural gas

Coal Biomass Nuclear Solar Hydro

72%

$115 billion

Iraq31 million*

Kuwait31 million*

$177 billion

55%

Iran75 million*

$482 billion

24%

Saudi Arabia28 million*

$578 billion

52%

* Population

Third in lineThe Middle East will record the third highest growth in demand for natural gas between 2010 and 2035 after China and the rest of Asia, driven by population growth and industrial expansion

Natural gas demand growth 2010-2035Total = 1,842 bcm

Rest of OECD

China

Rest of Asia

MiddleEast

Russia

Rest of non-OECD

United States

Source: IEA World Energy Outlook 2012



1Emerging economies are driving global energy markets. The share of non‐OECD energy demand is seen to rise from 55% in 2010 to 65% in 2035. China accounts for the largest share of the growth in global energy use, followed by India and the Middle East.

2 Iraq stands to gain almost US$5 trillion in revenues from oil exports over the period to 2035.

3The United States is projected to become the largest global oil producer before 2020, exceeding Saudi Arabia until the mid-2020s. But while non-OPEC oil output steps up over the current decade, supply after 2020 will depend increasingly on OPEC.

4Unconventional gas accounts for nearly half of the increase in global gas production to 2035, with most of the increase coming from China, the United States and Australia.

5Deployment of renewable energy is being driven by incentives, falling costs, rising fossil fuel prices and, in some cases, carbon pricing. The share of renewable energy sources in electricity generation is seen to grow from 20% in 2010 to 31% by 2035.

6 Electricity prices are set to increase by 15% in real terms on average by 2035, driven by higher fuel prices, increased use of renewables and, in some regions, CO2 pricing.

7Optimal progress in the implementation of energy efficiency measures could reduce global energy intensity (energy consumption per unit of GDP) by 1.8% a year. But a significant share of the economic potential of energy efficiency – four-fifths in the buildings sector and more than half in industry – remains untapped.

8 Energy is becoming a thirstier resource. Global freshwater use for energy production in 2010 totalled 583 billion cubic metres, or some 15% of the world’s total water use.

9Nearly 1.3 billion people remain without access to electricity and 2.6 billion do not have access to clean cooking facilities. Without further action, nearly one billion people will be without electricity and 2.6 billion people will still be without clean cooking facilities in 2030.

10Nearly $1 trillion in cumulative investment is needed to achieve universal energy access by 2030.

Growth in oil production (2011-2035)

Implementing the most advanced technologies in mature fi eld management demands more than leading-edge innovation.It also requires the ability to listen carefully to your needs and aspirations and to think “out of the box.”For almost 90 years, Total has been the committed, reliable, innovative partner whom you can count onto support sustained development across the Middle East.

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