Mena has $345b committed to energy projects

Arab Petroleum Investments Corporation says additional development projects planned

The Arab Petroleum Investments Corporation (Apicorp) said yesterday that critical energy projects pushed through over the next five years, despite the uncertain geopolitical backdrop with $345 billion (Dh1.2 trillion) committed to projects under execution while an additional $574 billion worth of development is being planned in the Mena region.

The overall economic outlook remains similar to the forecasts estimated this time last year, with growth of around 3.2 per cent forecast for both 2018 and 2019. Global investment in the industry is expected to pick up and parts of the Mena region are expected to see a corresponding improvement in investment, the multilateral development bank focused on the energy sector said in an emailed statement. “We see three important trends materialising in our outlook: the first is higher allocation of capital towards the power sector, which now accounts for the bulk of planned investments as demand for electricity continues to increase. The second is the increase in committed investments, reflecting an improving investment climate and a healthy transition of projects from the planning phase towards execution. And third, the private sector has an increasing role to play in financing energy projects in the Middle-East, that will help ease fiscal pressures on governments,” Mustafa Ansari, senior economist at Apicorp, said.

Saudi Arabia and the UAE represent 38 per cent of planned investments, with $149 billion and $72 billion respectively, over the outlook period, as both countries look to boost their upstream oil and gas sectors. For Egypt, the main focus is ramping-up of gas production and meeting rising power demand. Planned investments in the country are $72 billion, with the power sector at over 50 per cent of the total.