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Tuesday, 25 January 2011

Qatar-Iraq-Turkey-Europe natural gas pipeline: from dreams to reality

In 2022 Qatar will be the first Middle Eastern country to host the FIFA World Cup. Qatar is too small a country to organize the world cup. It is small both in terms of population and surface area. Its population is 850,000 while its surface area is 11,437 square kilometers. This small Gulf country has to prepare for an influx of about 1 million soccer fans, who will need accommodation, transportation and food. To be able to do this Qatar will have to make major investments in infrastructure and finance them.

Qatar is relying on being a major natural gas provider to fund its World Cup investments. In this context, it will be eager to boost its natural gas exports in the next 20 years. Qatar has the third-largest natural gas reserves after the Russian Federation and Iran. Qatar’s confirmed natural gas reserves were around 25.25 trillion cubic meters as of Jan. 1, 2009. This accounts for approximately 15 percent of the world’s natural gas reserves. A significant portion of its reserves are located in the massive North Field, a former marine field.

Qatar exports natural gas to Europe in the form of liquefied natural gas (LNG). It has developed new projects in order to improve the yield of LNG to natural gas transformation. The LNG method includes the costs of liquefaction of natural gas, its handling in liquid form via special tankers, and its eventual gasification. Additional calculations will be needed to assess whether it is more economical to use the LNG method or pipelines to export natural gas from the producer (Qatar) to consumers (the European Union).

UPDATE 1-Abu Dhabi Commercial Bank returns to profit | Reuters

Abu Dhabi Commercial Bank ADCB.AD (ADCB) on Tuesday said it swung to a fourth quarter and yearly profit helped by higher net interest income, beating analysts forecasts.

The lender, one of the region's most exposed banks to indebted conglomerate Dubai World [DBWLD.UL], booked 1.06 billion dirhams ($287.3 million) in provisions against its exposure. It was one of two UAE banks on the coordinating committee that negotiated Dubai World's $25 billion restructuring plan, agreed by lenders last September.

ADCB made a profit of 371 million dirhams in the three months to Dec 31, from a net loss of 1.24 billion dirhams in the same period last year, the bank said in a statement.

MIDEAST STOCKS-Kuwait plan lifts banks; prices seen stretched | Reuters

Kuwait banks .KWBNK hit a 27-month high on Tuesday as traders bought in ahead of quarterly earnings, but valuations may have run ahead of fundamentals.

Banks stocks have surged since Kuwait last year unveiled a $104 billion infrastructure spending plan -- to be part-financed by banks -- but few details have since emerged.

"Given the sheer size of the plan, I would wait to see concrete signs that it has passed through all the necessary hurdles first," said Ibrahim Masood, senior investment officer at Mashreq Bank.

Markets have a long way to go - The National

Much work needs to be done to bring the UAE's securities exchanges up to a world-class standard, according to analysts and market operators.

"The markets here still have the potential to become a regional hub for capital markets, bringing listings from Iraq and north Africa," said Julien Faye, the head of financial markets at Bain & Company in Dubai. "But for that to happen, regulators need to bring in stronger regulations, transparency, and make it cost-efficient for international investors to trade here."

Axiom Telecom, the mobile phones retailer, is considering a listing on the London Stock Exchange just two months after attempts to float on the Nasdaq Dubai were cancelled because of poor market liquidity, the latest in a series of companies considering listings abroad.

Dubai's DP World On Track For 2Q London Listing - CEO - WSJ.com

DP World (DPW.DIF), majority owned by Dubai World, the Dubai government conglomerate, is on track to list some of its shares on the London Stock Exchange in the second quarter after postponing its plans last year, the company's top executive said Tuesday.

"We are still on track for Q2; we are on track regarding the London listing by the end of the first half of 2011," DP World Chief Executive Officer Mohammed Sharaf said on a conference call with the media.

DP World, which is already listed on the Nasdaq Dubai stock exchange, said in late June that plans for a London listing had been delayed caused by the need to find "an acceptable system that supports the dual listing."

Abu Dhabi Ports cancels plan to sell bonds in 2011, UAE Industries - Maktoob News

State-owned Abu Dhabi Ports Co (ADPC) has cancelled plans to issue bonds this year after securing enough financing for its $7.2 billion Khalifa Port & Industrial Zone through its lenders.

Chief executive Tony Douglas also said on Tuesday he expected 7 percent growth in container volumes in 2011 due to the large pipeline of projects under way in Abu Dhabi, the wealthiest emirate in the UAE.

ADPC said in July it may sell up to $1 billion in bonds in the first quarter of 2011 and had appointed National Bank of Abu Dhabi as financial advisor to draw up a long-term financial strategy.

Kuwait's KIPCO raises stake in real estate firm | Reuters

"The firm (KIPCO) states that it acquired 33.11 percent in URC through one of its portfolios and therefore raise KIPCO's stake to 60.4 percent... turning URC to a subsidiary," KIPCO said in a statement on the Kuwaiti bourse website on Tuesday.

Algeria expects steady 2011 oil output | Reuters

Algeria expects to keep its oil output this year roughly steady, the head of its state oil and gas company said on Tuesday.

"We will stick to oil production which will be practically the same as in 2009 and 2010," Sonatrach CEO Nourredine Cherouati told a news conference.

Algeria pumped 1.27 million barrels per day in December, according to a Reuters poll of analysts and market participants.

Dubai port firm: 2010 business jumped 14 percent

DP World said Tuesday business rose 14 percent last year, reflecting the expansion of the Dubai port operator's global network and a resurgence in trade as the world economy picks up steam.

The world's third-largest seaport operator said its ports handled the equivalent of 49.6 million standard 20-foot cargo containers, up from 43.4 million in 2009.

CEO Mohammed Sharaf said the growth puts the firm on track to report financial results in line with analysts' expectations and ahead of last year's figures. Full earnings are expected in the coming weeks.

gulfnews : Saudi Basic Industries profit up 27%

Saudi Basic Industries Corp or Sabic, the Middle East's largest listed company, said Tuesday its fourth-quarter net profit rose 27 per cent on increased production and sales, driven by a recovery in demand and low raw materials costs.

Fourth-quarter net profit came in at 5.81 billion Saudi riyals (Dh5.68 billion), compared with 4.58 billion riyals a year earlier. However, the result fell short of analyst expectations at Cairo-based EFG-Hermes, which had expected Sabic to post a fourth-quarter net profit of 6.14 billion riyals.

Full-year earnings per share came in at 7.20 riyals, compared with 3.03 riyalsin 2009, the plastics, chemicals and metals company said in a statement posted on the Saudi bourse website. Net income for 2010 surged to 21.59 billion riyals from 9.07 billion riyals in 2009.

Rising stars of Middle East power a global recovery - The National

Four Middle East companies, including three from the UAE, are listed among the 100 "hidden engines" that are driving the world's economy, says a major US consultancy.

In a report entitled Companies on the Move,the Boston Consulting Group (BCG) identified Emirates Airline, Etisalat and DP World as among the fastest-rising stars in developing economies. It also identified Saudi Basic Industries Corporation (SABIC) - marking the first time a Saudi Arabian firm has appeared on the list.

These companies "have a strong local presence, but more so global", said Thomas Bradtke, the author of the reportand a partner at BCG's office in Dubai. "I would expect them to come strengthened out of the recent [global] turmoil."

FNC to debate laws that jail bounced cheque offenders - The National

The UAE must reconsider jailing offenders who bounce cheques and instead restrict their ability to carry out bank transactions, a member of the Federal National Council's (FNC) finance committee says.

Yousef al Neaimi, an FNC member from Ras al Khaimah, said that after a set number of bounced cheque violations, the individual should lose his banking privileges and the Central Bank should bar him from setting up new bank accounts elsewhere.

"It is a civilised deterrent," he said.

S&P Issues Negative Outlook for CityCenter - ABC News

Standard & Poor's Ratings Services issues a negative outlook on CityCenter, and says the casino complex will have trouble generating enough cash flow to justify its current capital structure.

The rating agency on Monday gave the casino complex owned by MGM Resorts International and Dubai World a "B-" corporate credit rating.

The agency says a recent offering of $1.5 billion in new notes only modestly offsets CityCenter's risks.

Dubai Group Said to Form Bank Restructuring Committees for $6 Billion Debt - Bloomberg

Dubai Group LLC, the investment company seeking to delay payments on about $6 billion of loans, has set up two bank committees to speed up its debt restructuring, two people with knowledge of the talks said.

Nexgen Group, a unit of France’s Natixis SA, and Dubai- based Mashreqbank PSC make up one group representing the secured lenders, whose loans are backed by assets, the two people said, declining to be identified because the information is private.

Royal Bank of Scotland Group Plc and Emirates NBD PJSC, the United Arab Emirates’ biggest bank by assets, lead the other group representing partially secured and unsecured lenders, the people said. Other members are Union National Bank PJSC, Noor Islamic Bank PJSC, Al Hilal Bank and Commercial Bank of Qatar QSC. The group held its first meeting last week.

FT Alphaville » SWFs, plotted


We’ve got the same question as the Oxford SWF Project: If the funds on the left are low in transparency, how do we know their strategy?

FT.com - Barclays in Dubai fraud case

Barclays is facing allegations it helped defraud a Greek pipe manufacturer in a case that could change the legal landscape for foreign banks operating in Dubai.

The Dubai International Financial Centre Courts are considering whether they have jurisdiction on claims that an employee of Barclays Dubai last year helped to defraud Corinth Pipeworks of $24.2m (£15m).

Barclays said the allegations referred to Barclays Dubai, a bank operating outside the DIFC, and should therefore be heard at Dubai Courts, not the DIFC. The bank declined to comment.

EM capital flows: $1 trillion and beyond? | beyondbrics | News and views on emerging markets from the Financial Times – FT.com

It’s no secret that as the developed world has struggled through the financial crisis, emerging markets have become ever more attractive to investors keen on the prospect of high returns, positive growth and acceptable perceived risks.

A new forecast from the Institute of International Financepaints a clear picture of this trend, estimating that private capital flows to emerging economies surged to $910bn in 2010 from about $600bn in 2009. What’s more, the IIF predicts that number to grow to $960bn this year – and to hit a whopping $1,000bn in 2012.

(Click to enlarge)

The regional breakdown is as you might expect, with Asia pulling in more than 40 per cent of net private flows with a record $446bn last year, dominated by China and India. Latin America comes in second with $220bn in 2010, approaching 2007′s record, with particular strength in corporate bonds.