Peter Bartlett, CEO, Bahrain Petroleum Company (BAPCO): Interview

Text size +-
Share
Peter Bartlett, CEO, Bahrain Petroleum Company (BAPCO)

Interview: Peter Bartlett

How are oil refining investments likely to affect the development of downstream industries?

PETER BARTLETT: As Bahrain looks to diversify its economy and sources of government revenue away from oil, downstream industries present clear opportunities, as the source material is readily available, and locating related industries nearby increases efficiency and reduces cost. One aim of the BAPCO Modernisation Programme (BMP) – the largest investment in the sector – is to increase the BAPCO oil refinery’s capacity from 267,000 to 380,000 barrels per day. We expect this to be operational in 2022. Procurement can represent up to 50% of the project cost, so it will be a key factor; however, we are hitting the cost curve at the right time, which will make the expansion more affordable.

The increased processing capacity is only one aspect of the BMP, which includes expanding the capability to refine “bottom-of-the-barrel” crude and increasing efficiency while reducing environmental impact. Growing refining capacity creates the opportunity to expand exports and direct additional refined oil towards local downstream industries like lubricants and petrochemicals. Bahrain’s geographic proximity to regional markets and access to global trade is an advantage for exporting not only oil, but also value-added products.

How has oil price volatility affected the sector?

BARTLETT: Oil volatility has had a significant impact on the global energy industry, and has forced countries and companies that rely on oil, either for revenue or for energy, to adjust to this. Despite this shift, hydrocarbons will continue to be significant contributors to both the energy mix and the economy for the foreseeable future. They are complemented, rather than hurt, by alternative energies, which can enable a greater portion of oil and gas to be exported or sent downstream.

In addition to the BMP, which provides large-scale investment in efficiency and modernisation, Bahrain is exploring prospects for offshore hydrocarbon. Volatility is perhaps a blessing in disguise, because it has had two main consequences. First, it has spurred interest in developing both efficiency and a sustainable energy mix. There has been a push to implement new technologies, increase recovery, and make better use of crude in ways that can reduce energy consumed and emissions produced during the recovery and refining process. Second, it has inspired a push towards diversification of the sector into new sources of energy production. A sustainable energy mix requires the use of alternative energies, as well as more traditional sources such as oil.

What role will alternative energy play in the domestic energy mix, and how will this take shape?

BARTLETT: A sizeable shift towards renewable energy is anticipated during the next two decades, but oil and gas are set to remain a significant energy source through 2040, making up at least 50% of the global energy mix. Different forms of energy will compete on affordability, sustainability and security of supply. The Bahrain Economic Vision 2030 emphasises sustainability and the kingdom is a signatory to the COP21 UN Conference on Climate Change.

For the energy sector this means improving efficiency and developing alternative sources of energy to reduce emissions. The domestic energy mix will include cleaner, more efficiently produced fossil fuels, supplemented with renewables. For example, a solar project is being carried out for BAPCO, the National Oil and Gas Authority, the Electricity and Water Authority and the University of Bahrain. The improvements in technology and the BMP both aid in increasing the resilience and reducing the environmental effects of our operations. Sustainability goes further to be ever more respectful of all stakeholder groups, and includes safety and efficiency improvements through digitisation in all parts of the value chain. Furthermore, education and training are becoming increasingly important as the sector continues to re-engineer itself at an accelerating pace.

You have reached the limit of premium articles you can view for free. 

Choose from the options below to purchase print or digital editions of our Reports. You can also purchase a website subscription giving you unlimited access to all of our Reports online for 12 months.

If you have already purchased this Report or have a website subscription, please login to continue.

The Report: Bahrain 2018

Energy chapter from The Report: Bahrain 2018

Cover of The Report: Bahrain 2018

The Report

This article is from the Energy chapter of The Report: Bahrain 2018. Explore other chapters from this report.

Covid-19 Economic Impact Assessments

Stay updated on how some of the world’s most promising markets are being affected by the Covid-19 pandemic, and what actions governments and private businesses are taking to mitigate challenges and ensure their long-term growth story continues.

Register now and also receive a complimentary 2-month licence to the OBG Research Terminal.

Register Here×

Product successfully added to shopping cart