Abu Dhabi: About $140 billion (Dh514.15 billion) worth of engineering and construction contracts have been either awarded by the national oil companies (NOCs) or are planned throughout the Middle East in 2011, according to research conducted by Deloitte, a global consultancy firm.
The research shows that over the next five years, the Middle East will witness strong growth in hydrocarbon production as the world's dependence on fossil fuels continues.
Kate Dourian, Middle East editor for Platts, a global energy information provider, told Gulf News most of the new oil projects in the region, both upstream and downstream, are running behind schedule.
"A lot of these projects were delayed in 2008, partly due to cost issues. The sour gas project in Abu Dhabi, the Fujairah refinery project, the upgrade of the Upper Zakum field are some examples of projects that are running behind schedule," said Dourian.
To attain forecast production levels, drilling activity, both onshore and offshore, must grow at a considerable rate due to the increasing demand for rigs and associated drilling services, the Deloitte research showed.
Deloitte forecast that the cost of drilling in the Middle East and North Africa (Mena) region would surge by more than $10 billion to $28 billion by 2014.
Deloitte's research also said, "Offshore exploration presents an opportunity for international oil companies to lend much needed technical expertise."
It revealed that the region's national oil companies originally focused on more accessible and cheaper onshore exploration, but are now under pressure to maximise and replace output from onshore and offshore fields that are maturing.
Deloitte said that an area where the private sector has the potential to play a particularly important role is the "construction and upgrading of regional petrochemical refineries and petrochemical plants."
Last month, a senior official representing the UAE at the Organisation of Petroleum Exporting Countries (Opec) said oil production in the Gulf Cooperation Council (GCC) countries is in good condition despite the global economic crisis.
Ali Obaid Al Yabhouni, the UAE's Opec governor, said that the rate of production encourages healthy investment in the oil industry.
His comments came during the 19th edition of the Middle East Gas and Petroleum Conference in Dubai.
Saeed Abdullah Khoury, chief executive officer of Emirates National Oil Company (Enoc), said at the conference that the proximity of the Middle East to the fast-growing emerging markets of Asia serves as a tremendous opportunity for the region's oil and gas companies.
"For the next year, demand for petroleum products is expected to rise to 90.7 million barrels per day — an all-time high. A large part of this strong demand will be driven by the non-OECD countries with Asian economies taking the lead followed by the Middle East," he said.