MUSCAT // Oman plans to build a 230km pipeline to carry gas to Duqm, the new industrial city on the eastern coast, a project official said yesterday.
"We are floating a tender for the bids of building the gas pipeline to Duqm," Yahya Al Zadjali, the head of planning of the Duqm Special Economic Zone, told delegates at a conference in Muscat.
"We hope the project to be completed in 2017 to fuel industrial projects in the new industrial area," he said.
Mr Al Zadjali did not say how much the pipeline would cost but an official at the Oman Tender Boardsaid the pipeline would cost "in the region of US$200 million[Dh734.6m] to $220m to construct."
The gas supply will be provided by the state-run Petroleum Development Oman from one of its largest gasfields in central Oman.
Oman is developing Duqm to be the second industrial city after Soharin the north-east of the sultanate, in its bid to diversify its oil dependent economy.
A port and airport are under constructions at Duqm. The once-sleepy fishing village will be also home to a planned 200 barrels per day oil refinery and a petrochemicals plant.
The government also plans to attract foreign investment in the Duqm free zone, which is under development, with incentives such as five-year corporate tax haven and no income tax.
Oman is currently pumping an average 880,000 barrels per day of crude oil and about 33 billion cubic meters of natural gas a year.
* The National
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The White Lotus: Season three
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Starring: Walton Goggins, Jason Isaacs, Natasha Rothwell
Rating: 4.5/5
Company Profile
Company name: Big Farm Brothers
Started: September 2020
Founders: Vishal Mahajan and Navneet Kaur
Based: Dubai Investment Park 1
Industry: food and agriculture
Initial investment: $205,000
Current staff: eight to 10
Future plan: to expand to other GCC markets
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ETFs explained
Exhchange traded funds are bought and sold like shares, but operate as index-tracking funds, passively following their chosen indices, such as the S&P 500, FTSE 100 and the FTSE All World, plus a vast range of smaller exchanges and commodities, such as gold, silver, copper sugar, coffee and oil.
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There are thousands to choose from, with the five biggest providers BlackRock’s iShares range, Vanguard, State Street Global Advisors SPDR ETFs, Deutsche Bank AWM X-trackers and Invesco PowerShares.
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Engine: four-litre V6 and 3.5-litre V6 twin-turbo
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COMPANY PROFILE
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AT4 Ultimate, as tested
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Engine: 6.2-litre V8
Transmission: ten-speed
Power: 420bhp
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Price: Dh325,125
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Company profile
Date started: 2015
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
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“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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