How are energy projects being financed? Large-scale projects - whether they’re gas processing facilities, extraction of hydrocarbons or the development of wind and solar - usually run into the billions.
The development of such large facilities requires a massive amount of capital upfront. During the Pennsylvania oil boom of the late 1800s, steely-minded entrepreneurs such as John D Rockefeller and Henry Flagler used their own equity but also borrowed heavily from banks to finance the early start-up of the US oil industry. Big Oil companies would eventually grow to their size and scale by tapping their cashflows for investment and accessing bank credit.
National oil companies, particularly in the Middle East, have largely been self-funded. However, with the volatility in the oil markets and changes in consumption patterns, state oil companies are increasingly monetising parts of their business. Renewable energy projects are also seeking private credit and new ways of accessing capital.
This week, I take a look at how some critical energy projects in the region are being built.
Last week saw a few major deals in the region. Abu Dhabi National Oil Company raised $11 billion in structured financing from a consortium of 20 banks to develop gas processing facilities for its Hail and Ghasha concessions. The company will use the “pre-finance” amount to help construct facilities that will be used to process the ultra sour gas, which is expected to come online by the end of the decade. Hail and Ghasha are developed by Adnoc with its partners - Italy’s Eni and Thailand’s PTT. Russia’s Lukoil, which was one of the upstream stakeholders, exited the concession in November.
What does this financing model do?
It shifts repayment responsibility off Adnoc, Eni and PTT’s balance sheets, with the liability sitting entirely with the project.
Are the funds available immediately then?
According to sources close to the project, the funds will be available in “staggered phases” from the financiers, who also include Chinese banks
Adnoc also secured $2 billion for low-carbon energy projects from South Korea’s export credit agency last week. Asian investors including Japan Bank for International Co-operation have contributed to $5 billion in green financing to help Adnoc progress projects that will lower its carbon emissions.
ACWA Power, Saudi Arabia’s power developer, also secured an unspecified amount for a desalination project from KKR last week. It marked the asset manager’s first foray into the kingdom. Alterra, the UAE’s $30 billion climate fund, is meanwhile investing in a fund managed by Copenhagen Infrastructure Partners to support the global expansion of renewable energy.
Meanwhile, Libya is inviting foreign companies to invest millions of dollars in greenfield projects to help raise production capacity stalled due to years of fractious politics. An Opec member, Libya is opening its oilfields to new investment for the first time in more than 17 years, aiming to raise output to 2 million barrels per day by 2030 from about 1.4 million bpd.
Who has qualified?
International oil companies, including BP, Chevron, ExxonMobil, TotalEnergies, Eni, Shell and OMV, have qualified for a new licensing round covering 22 oil exploration and development areas, split evenly between offshore and onshore blocks.
What can we expect?
“It’s reasonable to expect several hundred million to be committed in the round, higher if companies bid up offshore blocks,” Martijn Murphy, principal analyst for North Africa Upstream at Wood Mackenzie, told my colleague Fareed Rahman.
Jargon buster
Non-recourse financing: In which lenders are paid directly from the project's cash flow and not from the balance sheet of concession operators.
Big number
$2.85 per gallon
US holiday makers are in for a treat as US petrol prices fell to the lowest so far this year on Monday. Petrol prices have remained below $3 per gallon this month.
Special mention
Big Oil has its first female chief executive. Meg O’Neill will become the first woman to lead one of the world’s five largest oil companies from April 1, as BP refocuses on oil and gas after its push into renewables
Meg O’Neill speaks at an energy conference in Kuala Lumpur, Malaysia, in June. Reuters
Understanding of marketing objectives and audience engagement.
Tourism industry knowledge.
Professional ethics.
The specs
Engine: 3.0-litre 6-cyl turbo
Power: 374hp at 5,500-6,500rpm
Torque: 500Nm from 1,900-5,000rpm
Transmission: 8-speed auto
Fuel consumption: 8.5L/100km
Price: from Dh285,000
On sale: from January 2022
The entire coronation ceremony extends over three days from May 4-6, but Saturday is the one to watch. At the time of 10:09am the royal purification ceremony begins. Wearing a white robe, the king will enter a pavilion at the Grand Palace, where he will be doused in sacred water from five rivers and four ponds in Thailand. In the distant past water was collected from specific rivers in India, reflecting the influential blend of Hindu and Buddhist cosmology on the coronation. Hindu Brahmins and the country's most senior Buddhist monks will be present. Coronation practices can be traced back thousands of years to ancient India.
The crown
Not long after royal purification rites, the king proceeds to the Baisal Daksin Throne Hall where he receives sacred water from eight directions. Symbolically that means he has received legitimacy from all directions of the kingdom. He ascends the Bhadrapitha Throne, where in regal robes he sits under a Nine-Tiered Umbrella of State. Brahmins will hand the monarch the royal regalia, including a wooden sceptre inlaid with gold, a precious stone-encrusted sword believed to have been found in a lake in northern Cambodia, slippers, and a whisk made from yak's hair.
The Great Crown of Victory is the centrepiece. Tiered, gold and weighing 7.3 kilograms, it has a diamond from India at the top. Vajiralongkorn will personally place the crown on his own head and then issues his first royal command.
The audience
On Saturday afternoon, the newly-crowned king is set to grant a "grand audience" to members of the royal family, the privy council, the cabinet and senior officials. Two hours later the king will visit the Temple of the Emerald Buddha, the most sacred space in Thailand, which on normal days is thronged with tourists. He then symbolically moves into the Royal Residence.
The procession
The main element of Sunday's ceremonies, streets across Bangkok's historic heart have been blocked off in preparation for this moment. The king will sit on a royal palanquin carried by soldiers dressed in colourful traditional garb. A 21-gun salute will start the procession. Some 200,000 people are expected to line the seven-kilometre route around the city.
Meet the people
On the last day of the ceremony Rama X will appear on the balcony of Suddhaisavarya Prasad Hall in the Grand Palace at 4:30pm "to receive the good wishes of the people". An hour later, diplomats will be given an audience at the Grand Palace. This is the only time during the ceremony that representatives of foreign governments will greet the king.
Profile of Udrive
Date started: March 2016
Founder: Hasib Khan
Based: Dubai
Employees: 40
Amount raised (to date): $3.25m – $750,000 seed funding in 2017 and a Seed round of $2.5m last year. Raised $1.3m from Eureeca investors in January 2021 as part of a Series A round with a $5m target.
More than 2.2 million Indian tourists arrived in UAE in 2023 More than 3.5 million Indians reside in UAE Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
Other acts on the Jazz Garden bill
Sharrie Williams
The American singer is hugely respected in blues circles due to her passionate vocals and songwriting. Born and raised in Michigan, Williams began recording and touring as a teenage gospel singer. Her career took off with the blues band The Wiseguys. Such was the acclaim of their live shows that they toured throughout Europe and in Africa. As a solo artist, Williams has also collaborated with the likes of the late Dizzy Gillespie, Van Morrison and Mavis Staples. Lin Rountree
An accomplished smooth jazz artist who blends his chilled approach with R‘n’B. Trained at the Duke Ellington School of the Arts in Washington, DC, Rountree formed his own band in 2004. He has also recorded with the likes of Kem, Dwele and Conya Doss. He comes to Dubai on the back of his new single Pass The Groove, from his forthcoming 2018 album Stronger Still, which may follow his five previous solo albums in cracking the top 10 of the US jazz charts. Anita Williams
Dubai-based singer Anita Williams will open the night with a set of covers and swing, jazz and blues standards that made her an in-demand singer across the emirate. The Irish singer has been performing in Dubai since 2008 at venues such as MusicHall and Voda Bar. Her Jazz Garden appearance is career highlight as she will use the event to perform the original song Big Blue Eyes, the single from her debut solo album, due for release soon.
It Was Just an Accident
Director: Jafar Panahi
Stars: Vahid Mobasseri, Mariam Afshari, Ebrahim Azizi, Hadis Pakbaten, Majid Panahi, Mohamad Ali Elyasmehr
Rating: 4/5
When is VAR used?
• Goals
• Penalty decisions
• Direct red-card incidents
• Mistaken identity
MISSION: IMPOSSIBLE – FINAL RECKONING
Director: Christopher McQuarrie
Starring: Tom Cruise, Hayley Atwell, Simon Pegg
Rating: 4/5
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
