Despite a global demand shock, the Mena (Middle East and North Africa) region’s committed gas investments held steady compared to last year with planned investments increasing by 29 per cent to reach $126 billion.

This was mainly due to the strong ongoing regional drive for cleaner power generation and improved monetisation as a feedstock for the industrial and petrochemicals sectors, said the Arab Petroleum Investments Corporation (Apicorp), a multilateral development financial institution, which released its Mena Gas & Petrochemicals Investments Outlook 2020-2024 on the Mena region’s planned and committed investments for the period 2020 to 2024.

Notably, the petrochemicals sector witnessed a y-o-y increase of $4 billion in planned projects compared to last year’s outlook, while committed projects decreased by $13 billion due to the completion of several projects in 2019.

The share of government investments in committed and planned gas projects (92 per cent) is higher than it is in the petrochemicals sector (72 per cent). Given the increasing size of projects, such investments typically rely on a 70:30 or 80:20 debt/equity ratio.

The report features key regional developments in the regional gas and petrochemicals landscape and the dynamics shaping it over the short and medium terms.


The year 2020 is witnessing one of the biggest gas demand shocks on record, with a year-on-year (y-o-y) reduction of 4 per cent globally. This stands in stark contrast to 2019, which was a record year for liquefied natural gas (LNG) LNG Final Investment Decisions (FIDs). The 2020 global crisis is expected to reduce the annual growth rate for global gas demand during 2020-24 to 1.5 per cent compared to the pre-Covid-19 estimate of 1.8 per cent.

Dr Ahmed Ali Attiga, Chief Executive Officer, Apicorp, commented: 'The decrease in gas demand has put fiscal pressures on government and private sectors alike, and we expect a few committed projects to continue facing strong headwinds in terms of payments, supply chain issues and potential project delays. Overcoming these challenges will undoubtedly require strong policy support from governments, as well as enhanced collaboration between the private and public sector. To this end, Apicorp has continued to play a critical countercyclical role in alleviating these fiscal pressures and bridging the financing gap caused by the pandemic to strengthen the energy sector’s sustainability.'

Dr Leila R Benali, Chief Economist, Strategy, Energy Economics and Sustainability, Apicorp, added: 'The impact of Covid-19 on Mena gas demand and the petrochemicals sector will accelerate the industrial share of domestic demand. As outlined in our Mena Gas & Petrochemicals Investments Outlook 2020-2024, gas demand is expected to grow by approximately 3.8 per cent-4 per cent on average in Mena compared to 6 per cent in 2019. This downward revision is due to slower GDP growth and industrial output, the effect of price reforms, nuclear power projects coming online and increased share of renewables. Additionally, a prolonged depression of LNG prices will put further pressure on a few LNG exporters in the region during a time when pipeline exports were already taking a hit.'


The integration of the downstream value chain is expected to continue in the region, in conjunction with Asia. Saudi Arabia, Iran and Iraq leading the way in terms of committed gas investments.

The UAE has allocated $22 billion to the country’s continued gas development masterplan realisation, which includes unconventional and sour gas development. Following the model set by the $20.7 billion acquisition of a minority stake and lease rights in Adnoc’s Gas Pipeline Assets by an international investor consortium, other National Oil Companies (NOCs) in the region with large well-maintained midstream infrastructure may pursue a similar strategy to unlock intrinsic value and monetise strong asset bases. 

In terms of committed petrochemicals investments, Egypt tops the region, followed by Iran and Saudi Arabia.