Dubai announces new oil discovery

DUBAI: The government of Dubai announced on Thursday the discovery of a new offshore oil field located east of Rashid field.

UAE Vice President and Prime Minister Sheikh Mohammed bin Rashid Al-Maktoum, who is also the ruler of Dubai, said the new oil discovery would strengthen the economy and boost UAE’s oil output.

Sheikh Mohammed hoped the discovery would “give a strong boost to all sectors of the local economy and provide a new source of revenue that could strengthen the drive for comprehensive development in Dubai,” a government statement said.

The statement did not provide information about the size of the new field, saying that Sheikh Mohammed instructed the emirate’s oil department to “begin exploration work and conduct needed research to specify the size of the reserve, and its production capacity in the short and long term.”

Sheikh Mohammed’s announcement came during his meeting with a number of sheikhs, ministers and dignitaries just before the Cabinet meeting.

He assigned the task of the exploration and research to Sheikh Ahmed bin Saeed Al-Maktoum, chairman of the Oil Affairs Department in Dubai.

He expressed satisfaction over the performance of the Oil Affairs Department, which led to this new discovery. He called on the department to step up efforts to make best use of the existing oil resources in Dubai, as well as potential discoveries and utilize those resources to bolster the UAE’s economy.

Currently, Abu Dhabi, the capital of the UAE, produces most of the UAE’s oil and holds over 90 percent of its reserves. The UAE sits on the world’s fifth largest proven oil reserves, amounting to 97.8 billion barrels of crude oil. The UAE also has 214.4 trillion cubic feet (six trillion cubic meters) of gas reserves, ranking it sixth in the world after Russia, Iran, Qatar, Saudi Arabia and the United States.

According to the UAE government website, Dubai’s poor oil reserves, mostly offshore, are expected to be exhausted within 20 years.

Dubai’s crude has an influence on global oil markets that belies its limited output, as it is used as a pricing benchmark for more than 10 million barrels per day of crude heading to Asia from the Middle East.

The new offshore oil field lies east of the small field of Rashid, which is located some 70 km off Dubai’s coast. It is one of four main producing fields.

Dubai’s economy had boomed over the past years on non-oil sectors, particularly real estate and construction, which attracted huge investments, in addition to its prospering tourism sector