MANAMA: Bahrain is planning to establish a fund to allow private investors to invest in its oil and gas projects, Oil Minister Shaikh Mohammed bin Khalifa Al Khalifa has said.
Speaking during Gateway Gulf Investor Forum yesterday, the minister said this was part of a broader initiative to attract investment into infrastructure projects across various sectors in the kingdom.
The National Oil and Gas Authority (Noga) is planning to launch the fund, details of which will be revealed at a later date, to give private investors access to projects that have traditionally been backed by the state and largely unavailable to them.
“We are thinking of launching a fund where we make projects available to investors – investors that typically do not have access to these types of projects,” said Shaikh Mohammed.
“These are mature projects; they have been de-risked and construction is almost complete. It is a no-brainer for an investor to look at them.
“It is part of a drive to allow the private sector to come in. We never made it available for private investors to come in, so it is a novel approach. We are funding all our projects by ourselves,” added the minister.
“We don’t have an issue, but it will be interesting if we can attract private investors to come in through the fund. They will generate yields that they probably won’t be able to get anywhere else.”
Bahrain’s oil and gas sector is attracting strong interest following last month’s announcement of the country’s largest oil discovery since 1932.
The new reserves are located in the Khalij Al Bahrain basin, covering 2,000 sqkm in shallow Gulf waters off the kingdom’s west coast, and are estimated to contain more than 80 billion barrels of oil.
Talking about ongoing projects, Shaikh Mohammed said the Bapco modernisation programme will boost government revenues by $1bn annually.
Estimated to cost a total of $5bn, the expansion of the capacity of the existing Sitra oil refinery from 267,000 up to 400,000 barrels per day is on track for completion in 2022, he said.
It will also improve energy efficiency, valorisation of the heavy part of the crude oil barrel (bottom of the barrel), enhancing products slate and meeting environmental compliance.
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