Investments in the energy sector are attractive in the long term at current crude prices, with oil demand exceeding expectations, according to the chief executive officer overseeing energy at Abu Dhabi’s Mubadala Investment Co.
The current oil price is good for oil and gas investment, Musabbeh Al Kaabi said in an interview on Bloomberg TV from Abu Dhabi where hundreds of energy executives are meeting at a conference. Oil demand is “exceeding our expectation,” he said. Brent crude, a global benchmark, has climbed the past five consecutive weeks, and is trading close to the highest in two years. The January contract traded at $63.53 a barrel by 9:15 a.m in Dubai.
Mubadala manages about $125 billion in assets after the merger this year of two state investment companies with holdings from aerospace to energy to infrastructure. The government-owned investment vehicle is reviewing its portfolio as a step toward the possible sale of some businesses or holdings, people familiar with the matter said earlier this month.
The company is now producing about 500,000 barrels of crude a day, with major projects in Southeast Asia and North America, Al Kaabi said. “We believe in the energy landscape in the U.S.,” he said later in an interview.
Mubadala Petroleum is looking to expand operations in Thailand, U.A.E. Energy Minister Suhail Al Mazrouei said on Nov. 2. The company also owns an enhanced oil recovery project in Oman, according to its website.
Abu Dhabi, capital of the United Arab Emirates, an OPEC state, holds about 6 percent of the world’s proven oil reserves. Mubadala — the world’s 14th-largest fund, according to the Sovereign Wealth Fund Institute — is part of Abu Dhabi’s effort to turn oil revenue into profitable investments while also attracting technology and jobs. It completed a merger with Abu Dhabi’s International Petroleum Investment Co. earlier this year.
Al Kaabi is responsible for Mubadala’s petroleum and petrochemicals businesses, including Mubadala Petroleum, owner of the Dolphin Gas pipeline. The pipeline is used to send natural gas from Qatar to the United Arab Emirates, which depends on imported gas to generate half its electricity. Qatar is the world’s largest exporter of liquefied natural gas.
— With assistance by Fatma Abusief, and Hussein Slim