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Bahrain Oil and Gas Report Q2 2016

Bahrain Oil and Gas Report Q2 2016

BMI View: Despite limited success in boosting oil and gas production from the Bahrain field, the keydevelopment for the country will be the refining capacity expansion at the kingdom's centrepiece Sitrarefinery. However, delays to the expansion will result in a continuation of fuel export declines and awidening of the country's fiscal deficit until 2020. This marks a two-year delayto our previous forecast which saw increasing fuel exports from 2018.

We highlight the following trends and developments in Bahrain's oil and gas sector:

Redevelopment work (new wells, enhanced oil recovery and improved oil recovery) undertaken at theBahrain field are boosting oil production at the mature field. While we expect some success, the lowpermeability of the heavy oil reservoirs, among other issues, have led us to anticipate delays. We havenot yet included all volumes projected by the project.

In early 2015, the chief executive of Bahrain Petroleum Company (BAPCO) said a plan on whether toproceed with a final investment decision on the refinery expansion would only be presented in 2016. Asof March 2016, the company has yet to decide on its expansion. Should it proceed, completion of therefinery would be targeted by 2020. A 2020 completion date is a two-year delay to the original upgradetimeline, which targeted completion by 2018. We have modified our Bahrain forecast to reflect thisdelay, pushing back a ramp-up in refined fuels production to 2020.

In reaction to the low oil prices and its unsustainable fiscal dynamics, Bahrain has finally increasedrefined fuel prices late 2015/early 2016, and notably for gasoline prices, a first in the past 33 years. Weslightly adjusted out refined fuels consumption forecast in reaction. We expect further such moves can beexpected over the coming quarters and years, although changes will be implemented slowly andincrementally.

Indicative of expected gas production growth at the field is the award late 2015 of a contract in Bahrain tosupply a new gas processing facility to Petrofac. The new facility with a 5.1bcm capacity is the first of aseries of planned gas capacity projects scheduled for the next three to five years.


BMI Industry View
Table: Headline Forecasts (Bahrain 2014-2020)
SWOT
Oil & Gas SWOT
Industry Forecast
Upstream Exploration
Latest Updates
Structural Trends
Table: Proven Oil and Gas Reserves (Bahrain 2014-2019)
Table: Proven Oil and Gas Reserves (Bahrain 2020-2025)
Upstream Production - Oil
Latest Updates
Structural Trends
Table: Oil Production (Bahrain 2014-2019)
Table: Oil Production (Bahrain 2020-2025)
Upstream Production - Gas
Latest Updates
Structural Trends
Table: Gas Production (Bahrain 2014-2019)
Table: Gas Production (Bahrain 2020-2025)
Refining
Latest Updates
Structural Trends
Table: Refining Capacity and Refined Products Production (Bahrain 2014-2019)
Table: Refining Capacity and Refined Products Production (Bahrain 2020-2025)
Refined Fuels Consumption
Latest Updates
Structural Trends
Table: Refined Products Consumption (Bahrain 2014-2019)
Table: Refined Products Consumption (Bahrain 2020-2025)
Gas Consumption
Latest Updates
Structural Trends
Table: Gas Consumption (Bahrain 2014-2019)
Table: Gas Consumption (Bahrain 2020-2025)
Trade - Oil
Crude Oil
Latest Updates
Structural Trends
Table: Crude Oil Net Exports (Bahrain 2014-2020)
Table: Crude Oil Net Exports (Bahrain 2020-2025)
Refined Fuels
Latest Updates
Structural Trends
Table: Refined Fuels Net Exports (Bahrain 2014-2019)
Table: Refined Fuels Net Exports (Bahrain 2020-2025)
Trade - Gas (Pipeline And LNG)
Table: Gas Net Exports (Bahrain 2014-2019)
Table: Gas Net Exports (Bahrain 2020-2025)
Latest Updates
Structural Trends
Industry Risk Reward Index
Middle East - Oil & Gas Risk/Reward Index
Table: Middle East Oil & Gas Risk/Reward Index
Upstream: Index Resilient In Lower Price Environment
Table: Middle East Upstream Oil & Gas Risk/Reward Index
Downstream: Limited Opportunities
Table: Middle East Downstream Oil & Gas Risk/Reward Index
Bahrain - Risk/Reward Index
Market Overview
Bahrain Energy Market Overview
Regulatory Structure
Fiscal Regime
Licensing Regime
Table: Bahrain Licensing Regime
Oil And Gas Infrastructure
Oil Refineries
Table: Refineries In Bahrain
Oil Storage Facilities
Service Stations
Oil Pipelines
Gas Pipelines
Competitive Landscape
Competitive Landscape Summary
Table: Key Domestic And Foreign Companies In The Bahrain Oil & Gas Sector
Table: Key Upstream Players
Table: Key Downstream Players
Company Profile
Banagas
BAPCO
Chevron Bahrain
Occidental Petroleum
Other Summaries
Regional Overview
Middle East Oil And Gas Regional Overview
Oil Production: Weak Prices Have Limited Impact On Growth
Oil Consumption: Gradual Subsidy Reform To Temper Demand Growth
Refining Capacity: 2mn b/d Of New Capacity By 2020
Gas Production: Low Oil Prices Hinder Gas Progress
Gas Consumption: Switch To Gas Power Will Boost Demand
Table: Middle East - Oil And Gas Production, Refining Capacity And Trade (2013-2024)
Glossary
Table: Glossary Of Terms
Methodology
Industry Forecast Methodology
Source
Risk/Reward Index Methodology
Table: Bmi's Oil & Gas Upstream Risk/Reward Index
Table: Weighting

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