Why it’s all systems go for the Middle East’s booming energy sector as we kick-off for a new cycle of investment and growth in new low carbon technologies
With the kick off of the football season in the major European leagues upon us, headlines have been made by recent spending by the top clubs in the Saudi Pro League as well as investments in other global sports such as F1, boxing and golf.
This comes as no great surprise to those of us working in the Kingdom, or indeed in the wider region. There is a constant desire from governments across the GCC to redefine and even reinvent their countries and where they stand in the world even if it’s through the medium of sport.
Nowhere is this transformation more evident than in the region’s energy sector. For many decades the Gulf region has provided the world with abundant, affordable energy. Despite a few bumps on the road – most notably in the early seventies – the Gulf has been a guarantor of global energy supply. Yet, many people only seem to remember this role when global energy security is threatened.
Ambition translating to action.
Now, with energy security firmly under the spotlight and with COP28 taking place in the UAE later this year, I thought it time to provide my perspectives on what I’m seeing and how Alderley, together with industry partners, is helping to shape the new energy landscape.
With months to go before COP28 starts, its noticeable that countries in the region are becoming ever more active in investing in green technology that can promote decarbonisation.
The size of new investments shows the intent to transform the region into the leading player in renewables and clean infrastructure. For example, in March this year Neom Green Hydrogen Co secured an $8.5 billion investment to provide green hydrogen to the Neom megaproject that aims to carve a city out of the desert in the west of Saudi Arabia.
The Project foresees the development, financing, design, engineering, procurement, manufacturing, and testing of a green hydrogen and green ammonia plant with collaboration from international partners including Air Products.
We’ve also seen strong intent to develop carbon capture, utilisation and storage (CCUS) in the Kingdom with Aker Carbon Capture and Saudi Aramco signing a Memorandum of Understanding (MoU) to explore partnership opportunities to deploy the technology alongside industrial modularisation. Plans are underway for the partnership to focus on carbon emissions reduction and removal through CCUS from industries and energy solutions.
In the UAE, we’ve seen strong action in the low carbon space. In July, the UAE announced plans to triple its supply of renewable energy and invest up to a staggering $54bn over the next seven years to meet growing energy demands. As part of an updated national energy strategy, the investment will go into low-emission hydrogen fuel and developing infrastructure for electric vehicles. With a target of achieving Net Zero by 2050, the UAE plans to invest $163bn in clean and renewable energy over the next three decades.
These announcements are just the start of a deliberate shift towards the region becoming a pivotal player in global renewables and low carbon technology. Expect many more such announcements as COP28 gets underway later this year with the World Future Energy Summit in Abu Dhabi to come in the first half of 2024. It’s clear that COP28 has given a real shot in the arm to the region as a whole to push forward its energy plans.
The Alderley perspective
From an Alderley point of view, it’s evident that countries in the Gulf are looking for British companies to provide expertise, solutions and consultancy based on an energy partnership that’s been developing over decades.
We’ve seen this reflected ourselves as we were recently invited by the UK government to a workshop in Riyadh as part of a delegation of British companies aiming to contribute to the development and rollout of low carbon technology, with a strong emphasis on hydrogen. Central to our forward planning and offer in the region is supporting organisations and governments on best practice in the measurement of hydrocarbons, carbon dioxide and hydrogen.
We’ve already celebrated a major development this year by entering a strategic partnership and Memorandum of Understanding (MoU) with BENA Steel Industries (‘BSI’) to develop joint opportunities in Saudi Arabia’s energy sector in line with the Kingdom’s Vision 2030 plan.
The MoU is focused on building in-country capability, supply chains and solutions in the energy sector to support the Kingdom’s long-standing endeavours to deliver energy security to the world through existing hydrocarbon production and the development of new cleaner technologies, including hydrogen. As part of the MoU, BSI also plans to invest in Alderley Dammam’s M24 Branch.
That investment is key and a sign of our ambitions in the region. We pride ourselves on being a UK industrial company with a Saudi footprint having been on the ground here for over 20 years. And in the wider region, we’ve had facilities in the UAE for the best part of two decades and more recently in Qatar.
It’s over 12 years since we built our first hydrogen skid in the Kingdom – indication that we spotted the low carbon potential of the region early on. We greatly look forward to collaborating with UK and international companies as an industrial partner in Saudi Arabia and throughout the region with the support of our two other Alderley Group businesses, Kelton, and SMS. We are determined to grow our work in the energy transition space across the region.
Indeed, under an initiative of the Saudi Government, we’re basing our regional headquarters in the dynamic energy-hub of Dammam and are delighted to be deepening our roots to service new and long-established clients. In fact, our facilities in the Gulf serve a wider purpose as they will manage metering, hydraulic and Produced Water Treatment (PWT) work not just for regionally based clients but for customers further afield in North Africa, India, and Singapore.
Recently, our aftermarket business has gone from strength to strength with the recent award of a strategic project in Egypt from Gasco that involves upgrading the metering stations on a major gas system. We service the global FPSO sector from the Gulf. We are also rolling out digital solutions for clients and a suite of products that can be tailored and marketed for the region.
The Gulf region is an incredible place to work. Investments in energy, particularly the low carbon sector, show that the region is thinking and acting big with a global perspective as the investments in the Saudi Pro League also show. As a UK company with a global footprint, we’re redefining our own place on the pitch, keeping fit and agile and looking for new opportunities, ideas, and collaborations.
This article was written by Dermot Clarke, Alderley’s Managing Director for the Middle East. Dermot has spent over two decades working in the global energy sector.
***
