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Oil & Gas Sector Investment Landscape
The oil & gas sector remains a fundamental pillar of the Middle Eastern economy and as a dominant region for oil & gas, it also influences the world energy markets. According to OPEC’s Annual Statistical Bulletin 2024, 79.1% of the world’s proven crude oil reserves were accounted for by OPEC Member countries in 2023, with the bulk (67.3%) located in the Middle East. Moreover, the Middle East accounted for 32.5% of the world’s crude oil production and 17.7% of the world’s marketed production of natural gas.
For mergers & acquisitions, the overall deal activity in the MENA region surged, with 522 deals valued at USD 71 billion occurring during the first 3 quarters of 2024 (across sectors). The oil & gas sector dominated the domestic M&A activity representing 46% of the total deal value (USD 19.3 billion).
Illustrated below are several examples of mergers and acquisitions deals.
ADNOC awarded Azerbaijan’s SOCAR a 3% participating interest in SARB and Umm Lulu offshore concession.
Abu Dhabi National Energy Company (TAQA) agreed to sell its entire stake (47.4%) in the Atrush oilfield to Canada’s ShaMaran Petroleum.
Saudi Arabia’s Bawan Co. signed a Sale and Purchase Agreement with Petronash Global to acquire UAE-based Petronash Holding Ltd. for USD 175 million adjustable on the company’s future results.
QatarEnergy announced it will purchase a 23% stake in an offshore exploration block in Egyptian waters (North El-Dabaa H4) from Chevron.
MedcoEnergi announced the completion of its acquisition of 20 percent interest in two Exploration and Production Sharing Agreements (Block 48 and Block 60), owned and operated by OQ Exploration & Production LLC (OQEP).
Moreso, domestically, the ability of M&A to create value was illustrated by Saudi Aramco’s acquisition of an additional 22.5% stake in Rabigh Refining and Petrochemical Company for USD 702 million, a high-value deal that further stems Saudi Arabia’s position as a regional economic powerhouse.
Illustrations of prominent oil & gas Projects and their Capacity Targets
The oil and gas sector is witnessing a surge in initiatives such as setting up new plants for capacity expansion to align with increasing demand and gain market share. According to the International Energy Agency, world oil demand is estimated to surge by 1.1 mb/d in 2025 lifting its consumption to 103.9 mb/d. In 2024, the demand for gas globally was estimated to grow at over 2.5% (just over 100 bcm) reaching an all-time high level of 4,200 bcm. Similarly, in 2025, global gas demand is expected to grow by 2.3% (nearly 100 bcm).
Several prominent projects with their capacity targets are listed below.
Expansion of Fadhili Gas Plant in the Eastern Province of Saudi Arabia
The project is expected to increase the plant’s processing capacity from 2.5 billion to 4 billion standard cubic feet per day (bscfd) by 2030.
P5 Production Enhancement Plan
The P5 production enhancement plan aims to increase Abu Dhabi’s crude production to 5 million barrels per day by 2027 with the operator expected to spend up to $150 billion over the next three to four years.
LNG Train in Qalhat Complex
The Sultanate of Oman announced the commencement of the construction of a new liquefied natural gas (LNG) train at the industrial complex in Qalhat. Estimated to be operational in 2029 with an annual capacity of 3.8 million metric tonnes it will raise the Sultanate of Oman’s LNG production to 15.2 million metric tonnes per year.
Al Nokhatha Offshore Field
Kuwait Oil Company announced the discovery of large commercial quantities of light oil and associated gas in the offshore Al-Nokhatha field, located east of Kuwait’s Failaka Island. At approximately 96 square kilometers in area, the hydrocarbon reserves is estimated to be 2.1 billion barrels of light oil and 5.1 trillion standard cubic feet of gas as per the preliminary assessment. Moreover, the daily production from Al-Nokhatha well is around 2,800 barrels of light oil and 7 million cubic meters of associated gas.
North Field West Project
QatarEnergy’s North Field West project aims to boost the country’s Liquefied Natural Gas (LNG) production capacity to 142 million tons per annum (MTPA) by the end of 2030. The new 16MTPA project along with the North Field East and North Field South projects will increase Qatar’s LNG production from current levels of 77MTPA by nearly 85% by 2030. Following the completion of the North Field West project, the total hydrocarbon production of Qatar is estimated to surpass 7.25 million barrels of oil equivalent per day.
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Prominent companies involved in carbon capture initiatives
While diversification and adaptation within the oil & gas sector are imminent with the transition to clean energy, emerging trends such as carbon capture are gaining emphasis across the GCC region.
UAE’s largest oil producer ADNOC has raised its target to capture 10 million tonnes of CO₂ annually by 2030 versus its previous target of 5 million tonnes. One of the largest carbon capture projects in the region, the Habshan gas processing plant on completion in 2026 will be able to store 1.5 million tonnes a year of CO₂.
Saudi Aramco’s Jubail CCUS hub, due for completion in 2027 will capture up to 9 million metric tons of CO₂ annually. Of these 9 million metric tons, 6 million metric tons of CO₂ would be from its own operations while the other 3 million metric tons would be from surrounding industries. By 2035, Aramco has a target of capturing up to 11 million metric tons of CO₂.
Qatar is growing its carbon capture and storage projects and intends to store more than 5 million tons of carbon emissions (CO₂) annually by 2025. The move to increase its carbon capture and storage capacity is closely linked to the country’s target of growing its Liquefied Natural Gas (LNG) volume.
Kuwait Oil Company (KOC) in a joint project with Kuwait National Petroleum Company (KNPC) and Kuwait Integrated Petroleum Industries Company (KIPIC) targets capturing 100m³ of CO₂ to be used over 25 years. In addition, work is underway to study the best methods to store 400m³ of CO₂ for later use in production operations.
Bahrain’s Bapco Energies has teamed up with Japanese shipowner Mitsui OSK Lines to develop a cross-border carbon capture and storage project. Under a memorandum of understanding, the two companies will work towards establishing a CCS value where MOL would be responsible for shipping liquefied CO₂ and Bapco would provide the sequestration sites.
Oman’s sole gas transmission operator and owner, OQ Gas Networks is spearheading the conceptualization of a comprehensive CO₂ pipeline network in Oman to meet the requirements of early adopters in CCUS. This initiative forms a crucial part of Oman’s larger strategy to align with the Oman Vision 2040 and the nation’s Net Zero Emissions (NZE) target by 2050.
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