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UAE looks to Asia for economic opportunities

THE relationship between the United Arab Emirates and several Asian nations has become increasingly dynamic over the past year as a result of both opportunity and need

UAE looks to Asia for economic opportunities

THE relationship between the United Arab Emirates and several Asian nations has become increasingly dynamic over the past year as a result of both opportunity and need

02 August 2019 - 19:00

THE relationship between the United Arab Emirates and several Asian nations has become increasingly dynamic over the past year as a result of both opportunity and need. The deals in the pipeline also come amid an evolution in the traditional energy trades.

Part of this flurry of activity has been spurred by the efforts of Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed Al Nahyan, who has embarked on a number of visits to key Asian partners since the start of this year.



In February, Sheikh Mohamed visited Singapore and South Korea where engineering firm SK E&C clinched a deal to build the world's largest crude oil storage facility for Abu Dhabi National Oil Company (Adnoc) in Fujairah in the UAE.



Adnoc also inked three framework agreements with South Korean energy companies Korea Gas Corporation, Korea National Oil Company and GS Energy, to explore upstream exploration and production opportunities, potential downstream investments and bunkering opportunities for both crude oil and liquefied natural gas (LNG), reported UK's Lloyd's List.



The latest trip saw the Crown Prince making a milestone visit to China where he won broad-based deals from CNOOC and petrochemical company Wanhua Chemical Group.



The agreement with CNOOC will enable the two oil-related companies to collaborate in the upstream and downstream oil and gas sector, especially with sour gas processing and treatment, as well as on LNG sales.



'This far-reaching framework agreement underpins the close economic ties between the UAE and China, and offers exciting new growth opportunities,' Adnoc group chief executive officer Sultan Ahmed Al Jaber was quoted as saying.



The partnership will also see the Chinese group's offshore engineering arm COOEC being qualified as a contractor for engineering, procurement and construction opportunities, and another unit, China Oilfield Services coming on the list of Adnoc's qualified oilfield services suppliers.



As for downstream co-operation, that will involve collaboration on new integrated refining and petrochemical assets in China, as well as CNOOC's existing refining assets.



Adnoc's US$12 billion deal with Wanhua Chemical Group will see collaboration in the downstream sector focusing on producing downstream derivatives. This follows on from an agreement the two parties signed in November 2018 for a shipping joint venture based on a ten-year LPG supply contract inked in November 2018.



Adnoc Logistics & Services and Wanhua Chemical will create a partnership for liquefied petroleum gas (LPG) transportation including the operation of two very large gas carriers.



UAE companies also signed a string of oil and gas deals in Indonesia in the wake of the Crown Prince's visit. The first is a $2.5 billion deal with Indonesian state-owned energy company Pertamina for oil and gas collaboration in both countries and globally.



In the port sector DP World has signed deals with local conglomerate Maspion Group to develop a $1.2 billion, three million TEU container terminal and industrial logistics park in Gresik in east Java.



The increased engagement is part of the emirates' 'Look East' policy which has been driven by Sheikh Mohammed since 2017. This comes from recognising that its future is increasingly dependent on its ties with Asian nations as they continue to be the fastest growing economies in the world for the foreseeable future.


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