Oil expansion plans curbed, says report

OPEC cuts, complex oil reservoirs and uncertainties over concession renewals are hindering Abu Dhabi’s efforts to raise oil production capacity, according to a leading investment bank.

Analysts at Morgan Stanley said the emirate had been “forced to dramatically curb expansion projects” that were supposed to raise its oil production capacity by 40 per cent to 4 million barrels per day (bpd) from 2.85 million bpd by 2015.

“The UAE’s foreign partners, including Total, Shell, BP and ExxonMobil, are reluctant to invest in further idle capacity expansion at a time when they cannot sell what they produce [due to reduced OPEC quotas] and are facing an uncertain outlook regarding the renewal of their concession agreements,” they said in a recent report.