Bahrain is looking into launching a new international bid round for offshore gas exploration, seeking to reduce its dependence on gas supplies from other regional players, and to boost its domestic gas production amid the growing demand of 2.5% annually, Interfax Global Energy reported.
It is unclear if the bid for contracts will be approved due to low energy prices on the global market and reluctance of international investors to launch their businesses in the country. One of the reason being that Bahrain’s acreage may be considered too risky given that the country has the smallest proven gas reserves in the GCC, standing at only 200bcm, according to BP estimates.
This move confirms the latest strategy of Bahraini government in the energy sector expanding domestic capacities through larger investments, according to Zawya. In December last year, Bahrain awarded a contract to build a floating liquefied natural gas (LNG) terminal to Bahrain LNG, a joint venture with foreign companies. In September, an oilfield services provider, Petrofac, won a contract for a new 500mcf/d gas dehydration facility. There were also plans for an expansion of gas-processing facilities at the Bahrain National Gas Company (Banagas), ramping up production to 350mcf/d.
In addition, Bahrain has also recently allocated $6b of investment in the non-oil sector with the help of the GCC Development Fund. The money will come from Saudi Arabia, the United Arab Emirates, and Kuwait and be spread evenly across projects in manufacturing, construction, and tourism.