Saif Humaid Al Falasi, Group CEO, Emirates National Oil Company (ENOC): Interview

Interview: Saif Humaid Al Falasi

Which export markets do you see as the fastest-growing destinations for refined products?

SAIF HUMAID AL FALASI: The emerging economies of Asia and the Middle East are certainly the fastest-growing markets when it comes to demand for refined products. Income levels in the UAE, the GCC and Asia are rapidly growing, with GDPs rising annually within the range of 3-7%. Among these countries, India and China stand out not only for their size, but also for their continuous growth. Such development is expected to keep acting as a global engine for economic growth, to which the energy industry is no exception.

What pressures will Expo 2020 put on Dubai’s energy demand, and what can be done to relieve them?

AL FALASI: Dubai is moving into a new phase of growth, as the emirate aims to attract 20m visitors before Expo 2020, while 25m unique visitors are expected during the event itself. Undoubtedly these ambitions will increase the demand for energy and the need for critical infrastructure. Our appointment as the Expo 2020 Integrated Energy Partner places a responsibility on us, given our status as a national oil company, to continue investing in projects that will further the development of the country’s energy sector, such as an expansion of our refinery, the construction of the jet fuel pipeline to Al Maktoum International Airport, and our retail expansion plans across Dubai and the UAE.

As many states seek to vary their energy bases and reduce their environmental impact, how can oil firms support such aims while remaining profitable?

AL FALASI: There is a misconception that being green or environmentally responsible is expensive. In fact, the sector has witnessed a shift, as traditional oil and gas companies have restructured their business models and become diversified energy players.

Following Dubai’s Clean Energy Strategy 2050, which entails that 7% of the emirate’s total power output will come from clean energy by 2020, 25% by 2030 and 75% by 2050, ENOC has introduced alternative fuels such as biodiesel and compressed natural gas. Moreover, the company is currently invested in the development of ultra-low-sulphur diesel products. Overall, in the period 2014-17 we put $16.3m towards implementing sustainability initiatives, through which we have already achieved cumulative savings of $10.9m, or the equivalent of 115,000 tonnes of CO emissions.

What are the gains to be made from private investment in the upstream segment of oil production?

AL FALASI: Aligned with the ambitions of Dubai Plan 2021 and UAE Vision 2021, ENOC recognised the importance of gaining full access to the value chain and moved forward in 2015 with the full acquisition of Dragon Oil, which became the group’s exploration and production arm. This acquisition has been a gamechanger for ENOC, transforming the group into a fully integrated oil and gas player. This has contributed to the creation of a knowledge-based economy, as per UAE Vision 2021, and built on the positive socio-economic influence of national oil companies in the UAE.

The pathway to 2020 is lined with investment opportunities to pursue as we continue to deliver on our mandate to secure Dubai’s energy needs, and the development of an experienced workforce across upstream and downstream operations is at the heart of our strategy to leverage those opportunities. In the 25 years since ENOC started operating, the company has gone from using primitive maps to navigate dusty roads, to having a swathe of infrastructure projects, generating $13.8bn in economic value for Dubai in 2016 and recording a total of 249m barrels in 2017 alone. This is reflective of the wider evolution of the emirate’s energy sector, as well as Dubai’s economic development as a whole. Private investment has always been the key to the achievement of our goals, and it will continue to play a very important role in our success going forward.