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Middle East turns to domestic expansion


While the Middle East region remains the world’s major oil supplier, the focus for future pipeline expansions is turning to domestic opportunities, writes Nicholas Newman


Pipelines are the main arteries of energy transfer from the Middle East to Western and Asian markets. And while the age of major pipeline development may be over for now, development for many Middle East region countries is turning to providing suffi cient and resilient infrastructure to support anticipated economic growth, industrial development and rapidly growing cities. More than 2,300 miles of new pipelines are planned


for the Middle East region, as well as plenty of ongoing renovation and replacement projects both on and offshore. The driver for this investment in pipeline infra- structure is the anticipated increase in oil and gas production in the region. Oil production is expected to hit 3.6 mnb/d (million barrels per day) by 2019 while gas production is forecast to reach 69.6 bcm (billion cubic metres), according to Elinor Rurandor, media relations manager at DNV GL- Oil &Gas. The region’s new pipeline developments refl ect both


growing domestic supply and local demand for oil and gas as well as a reorientation of exports away from the traditional western markets and towards the growing markets of Asia. Local news reports across the region are fi lled with oil and gas pipeline schemes intended to improve existing export capacity to neighbouring countries, such as the proposal to link Iran to India via Oman, or with plans for new pipelines to supply Saudi Arabia’s growing cities with domestic oil and gas. Looking ahead, development of new production,


growth in local demand, and a focus on new markets will mean new pipeline construction projects will be


10 PIPELINE COATING | May 2015


assured for years to come. This article takes a country- by-country look at some of the main regional economic strategies and pipeline projects.


Oman – building gas networks The Oman Gas Company (OGC) - the Sultanate’s gas transportation company - operates some 2,500 miles of gas pipelines serving the country’s major population centres. Since 2008, it has been importing gas from Qatar via the UAE’s Dolphin pipeline. Plans were announced in February 2014 to build a 260km pipeline gas pipeline to import Iranian gas for domestic use and as a feedstock for its new LNG export terminal at Qalhat Sur. This announcement follows the signing of a Memorandum of Understanding between the two countries covering a 25-year $60bn supply deal starting this year. The Oman-Iran pipeline will connect the two


countries via the Gulf of Oman. Oman reportedly plans to use more than 350 bcf (billion cubic feet) of the contracted volumes annually for domestic purposes and will process the rest of the Iranian gas for export from its LNG terminals. It has indicated that half the gas transferred to the country will go to markets such as Japan, South Korea and India.


Saudi Arabia – network expansions Saudi Arabia’s state-owned oil company Saudi Aramco operates more than 12,000 miles of domestic crude and petroleum product pipelines. Its major pipeline schemes include:


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