Gassing the Galaxy Galore

What offshore and onshore infrastructure has Dana Gas put in place to be able to develop the Zora field?

The Zora field is in a concession straddling the offshore waters of Sharjah and Ajman and has been delineated by three wells drilled between 1999 and 2002. The first production from the Sharjah-2 well, a dual lateral horizontal well with a combined horizontal length of 9,000ft, commenced in February 2016. Gas and liquids are brought from the unmanned offshore platform via a 12-inch pipeline to shore for processing in the Dana Gas Zora Gas plant located in the Hamriyah Free Zone and which is capable of handling 40mmscfd of gas with associated condensate and water.

How would you describe Dana Gas’ exploration success rate in Egypt, and what have been your latest investments there?

In partnership with the Egyptian government, we operate 14 development leases along the Nile Delta and hold three large exploration concessions. Dana Gas is Egypt’s fifth-largest gas producer. We consider Egypt a core country for us, which is why we signed the mutually beneficial Gas Production Enhancement Agreement to enable us to further invest in growth and provide a mechanism for our receivables to be paid down. We have invested over USD300 million in Egypt since 2015. We are doing well operationally in Egypt. Production is at 40,000bpd, a 24% quarter on quarter increase compared to 2016 and is at maximum plant capacity for the first time. We have achieved a high success rate of 92% on our exploration and development drilling campaign. We have also now reached maximum capacity at our El Wastani gas processing plant.

How do you expect natural gas demand to evolve in the GCC in the next few years?

My personal experience in the UAE in particular and the GCC more generally is that there is great understanding and concern about the impact of everyday decisions and activities on the environment, in addition to the COP21 commitments already made. Energy demand in the Middle East is expected to almost double from 14mmboe/d to 25mmboe/d in 2040. Fossil fuels are expected to continue to dominate on the supply side. Therefore, reducing CO2 emissions becomes a key challenge. Middle East CO2 contribution is currently only 5% of global emissions, but with the forecast demand growth through to 2040, CO2 emissions in the region will significantly increase. Gas currently contributes 51% of the demand in the Middle East and will contribute 54% by 2040. Furthermore, the use of oil is expected to fall as gas supplies increase from 58% to 67% of electricity demands by 2040. As such, the role of gas as a clean source of supply has the potential to play an increasingly significant role for Middle Eastern nations to comply with their COP21 commitments in lowering CO2 emissions.

How significant is the role of the banking industry to support the gas sector?

It is important. However, given the reality of our industry, with the cyclical rise and fall of prices and the inherent risk of exploration, it is not always easy for companies to access the funding they require. Our approach at Dana Gas is to take every step to be profitable when prices are low; everything beyond that is a bonus.

How do you see the role of women in the Middle East evolving at the executive level, especially in your industry?

After 30 years in this industry, I do not see any huge strides being made. No company or organization should have women at the executive level for visual effect alone; though diversity of thought and approach make great business sense. And quotas are nonsensical: merit and gender are two different things. That said, there is a great deal to overcome before we will see equal numbers of women at the executive level.