Investments in the Middle East and North African region’s gas sector have shown a steady surge to reach $126 billion, up 29 per cent in comparison to 2019. Contrary to overall global developments, the region’s petrochemicals sector shows a year-on-year increase of $4 billion in planned projects in comparison to 2019. At the same time, total committed projects showed a decrease of $13 billion, this is largely caused by the completion of several projects in 2019. Apicorp’s optimism is based on the ongoing downstream value chain integration. While the UAE is committed to its $22 billion gas development masterplan, which includes the well-covered unconventional and sour gas projects, main gas players such as Saudi Arabia, Iraq, and Iran are still committed to their respective gas investments. Saudi Arabia and Iraq are looking mainly at gas-to-power projects, while Iran is increasing its emphasis on petrochemicals.
Gas demand is expected to grow by approximately 3.8 to four per cent on average compared to six per cent in 2019. This downward revision is due to slower GDP growth and industrial output, the effect of price reforms, nuclear power projects coming online and the increased share of renewables. A prolonged depression of LNG prices will put further pressure on a few LNG exporters in the region during a time when pipeline exports were already taking a hit.