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Saturday, 23 January 2010

Developers struggle to finish Dubai hotels

Last year Trump Tower, the centre-piece of Nakheel’ iconic Palm Jumeirah project in Dubai was shelved.

Now this week it has emerged development of the luxury Fairmont Hotel & Resort and Residences, comprising 400 hotel rooms and 558 privately-owned apartments, is being bogged down by concerns over funding.

Construction of the property is well advanced and was expected to be completed by now. In fact it was originally scheduled to be completed in 2008. The hotel operator, Fairmont Hotels & Resorts, however this week confirmed the opening of the hotel will now not occur until at least 2011. It is the third luxury resort on the unique series of palm-shaped islands to defer its opening. Aside from Trump Tower, which incorporated a 5 star hotel along with private residences, the Palm Kempinski, a similar development, has deferred plans to open its doors despite the property being almost complete.

Saudi Zain in Credit Talks After Missing Commitments

Zain Saudi Arabia <7030.SE>, the kingdom's newest mobile phone operator, said on Saturday it is in talks with lenders after missing some commitments last year on a two-year $2.5-billion Islamic loan.

The Saturday announcement by the firm -- 25-percent owned by Kuwait's Zain -- is a fresh reminder that Gulf Arab corporate debt problems could be far from being over at a time when economies in the region hope that 2010 will be a year of recovery.

Investor confidence in the region has been hit over the past eight months by up to $22 billion of debt restructurings at two prominent groups and more recently by Dubai World's request for a standstill on $26 billion worth of debt.


Having significantly lowered natural gas imports from Turkmenistan, Russia’s state-controlled energy conglomerate Gazprom is turning to Azerbaijan to make up some of the difference.

Gazprom and its Azerbaijani counterpart SOCAR announced on January 21 that the Russian conglomerate would significantly increase gas purchases from Azerbaijan over the next two years. An agreement signed last year, indicated that Gazprom would buy 500 million cubic meters (mcm) of gas from SOCAR in 2010. But following a meeting in Moscow between Gazprom CEO Alexei Miller and his SOCAR counterpart Rovnag Abdullayev, the Russian firm announced that it would obtain 1 billion cubic meters (bcm) of SOCAR gas this year and 2 bcm in 2011.

Following the meeting with Abdullayev, Miller reiterated a pledge to purchase "as much gas as SOCAR can supply." Experts widely believe Gazprom’s desire to lock up SOCAR’s gas production is motivated by a desire to prevent the construction of new energy export routes that would circumvent Russia, and, therefore, break the Kremlin’s stranglehold on the European market.

Qatar May Invest in Petrobras Refinery Project

Qatar may invest in a refinery joint venture with Petroleo Brasileiro SA, Brazil’s state-controlled oil company, the South American country’s Energy Minister Edison Lobao said.

Qatar is also interested in investments in oil exploration in Brazil, Lobao said yesterday in an interview in Brasilia.

Qatar, the world’s biggest exporter of liquefied natural gas, is spending billions of dollars to diversify its economy with acquisitions of stakes in London-based lender Barclays and carmaker Volkswagen AG. Rio de Janeiro-based Petrobras is spending $174.4 billion through 2013 to boost output by more than half and develop offshore fields such as Tupi, the largest discovery in the Western Hemisphere since Mexico’s Cantarell.

Eni, Occidental to Spend $1 Billion a Year on Iraqi Oilfield

Eni SpA and partners including Occidental Petroleum Corp. plan to spend about $1 billion a year to boost production at Iraq’s Zubair oil field by 1 million barrels a day after winning rights to develop the deposit.

Iraq, holder of the world’s third-largest oil reserves, signed a 20-year development contract for Zubair with the group led by Eni, Italy’s largest oil company, in Baghdad today.

Eni and partners Occidental and Korea Gas Corp. will “start working from tomorrow to create a development plan and rates of production and investment” for the Zubair project, Iraq’s Oil Minister Hussain al-Shahristani said today.

Dubai Debt Woes Will Hurt U.A.E. Property Industry, Nomura Says

Dubai’s debt crisis has sapped investor confidence and may hurt the property industry in the United Arab Emirates this year, analysts at Nomura Holdings Inc. said in a report today.

“The Dubai government’s announcement of a Dubai World restructuring and debt standstill agreement has put an end to any likelihood of a real estate recovery in 2010,” Nomura said.

Dubai World, one of Dubai’s three main state-owned business groups, said on Nov. 25 that it would seek to delay repaying debt for at least six months, roiling markets in the Middle East and around the world. The global credit crisis led to a 50 percent decline in property prices in the city and hampered the ability of Dubai-based companies to raise loans and refinance.