|A VIRTUAL roadshow will soon be hosted by Bahrain in a bid to attract international companies for the development of new oil reserves.Oil Minister Shaikh Mohammed bin Khalifa Al Khalifa said the companies would be invited to work with national firms to explore the 2,000sqkm tight oil and deep gas resources in the Khalij Al Bahrain basin.
The 2018 discovery of the largest oil and gas find since 1932 off Bahrain’s west coast is estimated to contain at least 80 billion barrels of tight oil.
The minister also said that despite the Covid-19 outbreak and low oil prices, he remained “optimistic”, expecting demand to pick up in the coming months as global travel restrictions are eased.
“As we entered 2020 the prices were in the $65 range and nobody had an idea of this pandemic,” said Shaikh Mohammed.“We saw a sharp drop in demand and I think April was one of the worst periods in the oil industry, as we lost 25m barrels of demand.
“And for the first time, we saw negative pricing on West Texas intermediate (WTI) crude, which nobody really expected.”In March the Organisation of Petroleum Exporting Countries (Opec) decided to reduce oil production by 10 million barrels per day from May 1, for an initial period of two months.
The hope is that the global pandemic will soon recede and the economy will flourish again.The minister, who was speaking at a virtual majlis organised by the American Chamber of Commerce Bahrain, said the situation was slowly returning to normalcy with global economies opening up and flight resumptions are on the radar.
“The good news is that the surplus supply of 25m barrels is now closer to 6m, which indicates demand is picking up,” he said.“However, we have to wait until June to see any real improvements.”
He explained that they were hoping for a V-shaped recovery by the second quarter, adding that it is imperative for people to resume travelling and get back to doing business.“Our projects continue to be going ahead, of course there are austerity measures which are critical as the entire region is doing it,” he said.
“But for now, I think we remain optimistic that the situation is very stable.”
Shaikh Mohammed also discussed ongoing work at the four offshore exploration blocks, covering an area of 9,000sqkm.“We are doing a lot of work here and looking into a few appraisal wells and deep gas resources,” he said.“We plan to hold a virtual roadshow soon and welcome companies to approach us and we will grant them access to our virtual data room.”
However, he revealed that drilling in the first exploratory well in Block 1 by Italian energy company Eni has been postponed due to the coronavirus pandemic and the travel restrictions.
“Hopefully in the coming weeks we will have clarity but the equipment is ready for drilling the first exploration well in Block 1,” he added.He said they were looking to drill more appraisal wells, adding they were “looking to see much bigger numbers in terms of commercial reserves”.
“I like to look for signs of hope amidst these challenges, as there will be opportunities in the sector as oil prices are going to improve,” said Shaikh Mohammed.As for the recently discovered block 4, he said it is located in the Gulf of Bahrain where drilling of the experimental well was completed.The well began to flow last year and it will be added to the production systems soon, added the minister.
Meanwhile, the minister also spoke about ongoing projects to use renewable energy in government buildings and social welfare houses.“The idea is to achieve a more efficient consumption of electricity and we have installed solar panels in pilot buildings and social houses,” he said.
“I think we’ve achieved three per cent reduction in consumption.”The GDN has reported on plans to fulfill the goals of the national strategy that aims to optimise energy efficiency by six per cent and attain 5pc of total energy production from renewable energy by 2025.
The national blueprint also aspires to develop the rate of contribution of renewable energy to 15pc by 2035, alongside other efforts to boost fossil energies. The National Renewable Energy Action Plan and the National Energy Efficiency Action Plan aim to save energy worth BD230m