Despite having a smaller energy sector than its neighbors in the UAE, Sharjah has a longstanding association with hydrocarbon extraction.

The United Arab Emirates plays host to the world's sixth largest proven oil reserves, at just under 100 billion barrels, and holds the seventh largest gas reserves, a total of 215 trillion cubic feet, making the country a key global energy sector leader. However, these valuable resources are not spread evenly across the country's seven regions. In stark contrast to its Emirati neighbors, Sharjah's economy is not excessively based on the extraction of hydrocarbons. Its successful diversification policy has created an economy that is stable and not nearly as susceptible to price changes in the global energy market as those of other countries in the region. The recent Moody's "A3" long-term credit rating with a stable outlook confirms this, with sectors such as tourism, logistics, manufacturing, and education all emerging as arguably more critical to the Emirate's economy.

This is not to say that Sharjah's energy pedigree is in doubt. Decades before the first wells were dug elsewhere in the country, the Emirate was serving as a stopover and refueling point for Air BP transits between the subcontinent and the UK. For three quarters of a century, then, Sharjah, has been linked to the international energy industry. A number of major offshore and onshore fields have been discovered since, and the Emirate is continuing to produce from its established reserves. The possibility of sourcing new reserves may be low, as in the rest of the country, with Russia's Rosneft even contemplating pulling out of an agreement with local firm Crescent Petroleum having failed to make new discoveries over the past five years. However, existing oil and gas fields are still providing.

It is five years since the Emirate's leaders established the Sharjah National Oil Corporation (SNOC) for exploration, discovery, and extraction operations. Its immediate mission was to manage the handover of the Sajaa gas development concession, which had been held by BP until that time. The government took on a 60% share in the venture, with the remainder being passed on to London-based Petrofac. The Sajaa Gas Plant and field have stood as critical revenue generators for the Emirate since discovery 35 years ago, and this recent changeover has allowed Petrofac to carry out key repair and renovation activities that will guarantee the longevity of the asset. The firm also works with the China Petroleum & Construction Corporation to provide EPC and project management support for Chinese interests in the Emirate.

Gas extracted as part of this project serves not only to fund Sharjah's public expenditures, representing as it does a key part of the Emirate's export mix, but also delivers a substantial portion of the gas that runs local power generation facilities. The Sharjah Electricity & Water Authority (SEWA), previously the Sharjah Electricity & Water Department, was created as an independent entity to administer the distribution and provision of electricity, gas, and other utilities to the local population. The lion's share of SEWA's power generation activities comes from its gas turbines, with a full 83.2% of the overall electricity produced in this manner in 2013. The largest of these stations is at Wasit, and generates 41.11% of SEWA's available capacity, and is followed by Layyah with 31.68%. The rest of Sharjah's power comes from Kalba, Hamriyah, and Khor Fakkan. SEWA fully supports the development of other smart solutions to the Emirate's energy demands, and most recently announced its intent to collaborate with US firm Teleformer to introduce monitoring systems and guarantee the more efficient transmission and production of electricity.

Additional opportunities promise to supply Sharjah with extensive gas reserves into the future. The primary undertaking at present is the Sharjah Offshore Concession at the Western Offshore block and the Zora field, which were drilled as far back as 1979 with the Sharjah-1 well in the Thamama reservoir. The Sharjah-2 well, created in 1999, further increased interest in the find, and under a decade later an agreement set down in 2008 with Dana Gas to fully develop these offshore assets. The company made additional agreements in the same year with the neighboring Emirate of Ajman, and began work on drilling a 3,000ft horizontal extension and a wellhead platform as well as a 25km-offshore pipeline to transfer the gas onshore. The project was green lighted two years ago and is scheduled to be up and running in 2015, while funding has been sourced by a consortium of banks headed by Emirates Bank NBD Capital. The project also represents an opportunity for the Emirate to further develop links with contractors and companies from other parts of the UAE. Adyard, and Abu Dhabi-based company, is providing technical support by constructing an unmanned offshore platform as part of a $17 million contract, and various other commissions have been awarded for design and procurement activities. Ultimately, a 60-million cubic feet of gas capacity is anticipated from the field, though initial production will likely stand at two-thirds of this figure. The gas will be processed onshore, and will be transported via the Hamriyah Free Zone storage facilities and on to the SajGas plant to the east of the city. The SajGas project will allow for the sweetening of the gas, which will then be fed into the northern Emirate's gas grid.

Crescent Petroleum is a founding shareholder of Dana Gas PJSC, backing its incorporation in the Emirate of Sharjah in 2005, and currently retains 21% of shares. Crescent is behind many of Sharjah's oldest and most important energy projects, and is an example of the local administration's unique approach to energy investment; one which focuses on encouraging private sector involvement as opposed to the state hegemony that exists in the energy sectors of other regional markets. As Majid H. Jafar, CEO of Crescent Petroleum explained in a TBY interview, “the openness to the private sector ranging from international large companies like BP to local players such as Crescent, to smaller international independents is unique. Sharjah Petroleum Council is the regulator, but operations are done by the private sector, and this openness to the private sector is found across industrial sectors." Crescent began with the Mubarek Field, which started producing in 1974, and has since provided over 100 million barrels of oil. The project's infrastructure includes 60,000 bpd of pipelines, and initially involved the development of the Ilam/Mishrif oil reservoir. Later on the reservoirs that would supply the Dana Gas Sharjah Offshore Concession were discovered and developed alongside the oil components of the venture. Another of Crescent's energy undertakings in the UAE is the Onshore Sharjah Concession, a 1,243sqkm area with four gas condensate fields that is being jointly explored with Russia's Rosneft. The company's other major projects are based in northern Iraq and Egypt, marking the expansion of Sharjah-based energy firms' interests in the region.

The Gulf-South Asia Gas (GUSA) project, an initiative to produce gas in Qatar and transport it 1,186km to Jiwani in southern Pakistan, is also being developed by Crescent Petroleum, further integrating the Emirate with broader international energy networks. The company has spent over $30 million on exploring the route, and it is expected that the midpoint compressor facility will be located in Dibba, an area on the eastern Indian Ocean coast of Sharjah.

Further potential for Sharjah's energy sector involves the improvement of its oil and gas-derivative products. Companies such as Sharlu, the Emirate's lubricant producer, have had decades of success developing specialized solutions for industrial operations in Sharjah and far beyond the UAE. As the local government readily supports such enterprises, the diversified nature of the Emirate's economy is clear to see. It is this fact alone which has cushioned Sharjah from the effects of the decline in global energy prices over the past year. As SEWA has shown in its pursuit of more sustainable electricity delivery, and as companies such as Bee'ah have demonstrated by introducing solar energy solutions to the Emirate, the likelihood of a more diversified energy mix is promising.