Company looks set to capitalise on planned growth in production
Joint venture aims for big Iraq oil sector contracts
Al Habtoor Leighton is chasing a construction package worth US$700 million (Dh2.57 billion) in Iraq's oil sector as it capitalises on the country's plans to expand production. Laurie Voyer, the managing director and chief executive of Al Habtoor Leighton, said the company was in the process of finalising a deal that involves two contracts for an offshore oil rig.
"It will be offshore activity so security will be less of an issue," he said. "Regardless, the prospect is a good one." Mr Voyer was speaking yesterday on the sidelines of MEED's Arabian World Construction Summit in Abu Dhabi but did not reveal any further details. Al Habtoor, the joint venture between Dubai's Al Habtoor Engineering and Australia's Leighton International that is also building a presence in Saudi Arabia, is among the first UAE contractors to enter Iraq, which is the holder of the world's third-biggest proved oil reserves.
Construction opportunities in the country are emerging as insurgency eases and the government spends $180bn on building roads, schools, hospitals and homes, and developing its oil and gas sectors. Consolidated Contractors Company (CCC), a Greek company with a significant presence in the UAE, has also recently started operations in Basra, according to its executive vice president of operations Samer Khoury.
Developers including Abu Dhabi's Al Maabar and Bloom Properties and Dubai's Damac Properties announced in 2007 and 2008 plans to build their own projects in Iraq. Last year, Deyaar Developments said it was also considering a move into the country. But expansion plans were set back by the global downturn, with most companies instead concentrating on finishing projects at home. This could be about to change, according to Sami al Araji, the chairman of Iraq's National Investment Commission.
"UAE companies are considering plans to construct 150,000 housing units throughout Iraq," Mr al Araji said during a forum between Iraqi and UAE government officials in Erbil, Iraqi Kurdistan last week. He added that projects under discussion were worth $70bn. One million new homes are planned across the country, with 140,000 units in Iraqi Kurdistan, Mr al Araji said. Contractors who benefited from the UAE's construction boom are also looking for work in other oil-rich countries such as Turkmenistan and Kazakhstan, as they adjust to the downturn.