Together, UAE and its neighbours prosper
▶ Adipec deals are a consolidation of shared strategic interests, at home and overseas
The Adipec oil and gas conference in the capital this week is proving to be the nexus between diplomacy, energy and social development. There are 2,200 exhibitors, 29 country pavilions, more than 100 government ministers and chief executives in attendance and about 110,000 visitors. But beyond those figures lies a symbiotic relationship between Abu Dhabi and the energy industry, which has been the foundation of the UAE economy for decades. The backdrop to the event has been Abu Dhabi National Oil Company’s plans to increase oil and gas production over the next decade. While the UAE is taking serious steps to further develop and diversify its economy, the message at Adipec is that oil and gas will continue to drive the country’s socio-economic ambitions. It also underpins the UAE’s relations with allies in the region and around the world.
Hence on Monday, Adnoc and Saudi Aramco agreed to jointly explore opportunities in the gas sector. Riyadh and Abu Dhabi are already collaborating on refining in India, a consolidation of their shared interests on both the domestic and foreign policy front, whether that is in dealing with Iran, Yemen or the US. A high-level Saudi-Emirati co-ordination committee is working to enhance co-operation in a number of areas, including defence, political institutions and the economy. However, it is energy that brings the UAE and Saudi Arabia closest together, with both facing an urgent need to meet the growing power demands of their burgeoning populations. It might be surprising to some that the two producers are working together to unlock their gas riches when both are competing for a share of the market for their oil exports, particularly in the lucrative reaches of Asia. That brings us to another deal struck at Adipec, which illustrates the importance of securing the market in that continent. Adnoc will explore the possibility of storing its crude oil in the Indian Strategic Petroleum Reserves’ underground oil storage facilities in Padur in the south-western state of Karnataka, while catering to India’s energy demands, which are the fastest-growing in the world and will continue to be until at least 2040.
The bigger picture is the UAE and its neighbours recognising that, together, they can harness their expertise and riches to greater effect than if they were going it alone. The rude health of oil and gas – across the value chain, from exploration to the production of petrochemicals – means that a critical source of income for the UAE will not only be secure but will continue to grow, providing the means for the broader development of society and infrastructure. The UAE Centennial 2071 vision, which aims to make the country among the best in the world, a century after it was first founded, requires considerable progress in education, innovation, healthcare and job creation. Those ambitions will need to be well-funded in the decades to come. Adipec has offered a window into how much might be possible.