$35b UAE Plan to Diversify Energy Sources

$35b UAE Plan to Diversify Energy Sources$35b UAE Plan to Diversify Energy Sources

The UAE is investing $35 billion to diversify its energy mix and reduce its dependence on natural gas imports, the country’s energy minister said.

“We need to minimize our reliance on natural gas and its imports … We are investing $35 billion for that purpose,” Suhail bin Mohammed al-Mazroui said on the sidelines of an energy conference in Abu Dhabi, Gulf Business reported.

He stressed the aim is to decrease the OPEC member’s dependence on natural gas from 100% now to 70% by 2021. Those investments are in nuclear and renewable energy projects.

Mazroui added that UAE is moving ahead with its oil and gas investments despite the current drop in oil prices and expects no delays in plans to boost its crude output potential by 2017.

“Investments are going; we are continuing with our investments,” he said, confirming Abu Dhabi's plans to boost oil production capacity to 3.5 million barrels per day by 2017.

A halving of oil prices in the past year had led to cutbacks in exploration and production across the oil industry. The fall in prices to below $50 per barrel has hit investment plans at major oil firms, national oil companies and independents that have had to find ways to conserve cash.

"Global oil investments this year are expected to drop by 20%, marking their biggest decline in history," Fatih Birol, head of the International Energy Agency, said last week.

The UAE is one of the world’s top 20 gas producers, but the country became a net importer of natural gas in 2008.

Its natural gas consumption reached a record high of more than 2.4 trillion cubic feet in 2013. The country uses a large amount of natural gas in its enhanced oil recovery operations and to operate its power and desalination plants, according to statistics by the US Department of Energy.