We saw a major development this week in the ongoing Qatar crisis, when Saudi Arabia, the UAE, Bahrain and Egypt announced they had modified the demands they were placing on Doha for them to lift the blockade. The four Arab states have outlined six principles that they want Doha to agree to in place of the 13 demands. Out have gone specific requests such as closing down Qatar’s satellite broadcaster Al-Jazeera to be replaced by a commitment not to interfere in other countries.

It does not necessarily reflect a softening of the position of the blockading group, but the broader terms make it easier to start a dialogue that can lead to a solution. Doha is still in a difficult position, however. Clearly it cannot reject principles it has already said it supports. But if it signs up, it will be more restricted in what it is able to do independently, which is its main position. So, still a long way to run but certainly progress.

In the meantime, Qatar has been taking steps to mitigate the impact of the dispute. This week, MEED reported the award of a $438m contract to design and build a food storage facility at Hamad Port. Proposals were submitted last October, but the deal has been modified to include processing facilities and appears to have been expedited by the blockade.

Qatar also this week signed an agreement with Malaysian shipbuilders to buy two new cargo ships.

Also in Qatar this week, MEED reported the introduction of new contract clauses that require contractors to carry increased costs due to the blockade. 

Saudi Arabia renewable energy

In Saudi Arabia this week, we saw the Renewable Energy Project Development Office (Repdo) launch its second round of renewable projects to add 1,020MW of capacity. In an exclusive interview with MEED, Repdo head Turki al-Sheri said a large-scale solar and wind scheme would be tendered in the fourth quarter this year.

Currently, Repdo is tendering 700MW under the first round of projects and this week invited developers to prequalify for a 400MW wind farm. 

Finance

Saudi Arabia’s Finance Ministry has selected 13 domestic banks to participate in the kingdom’s planned local currency Islamic bond issuance programme. Saudi Arabia is looking the raise funds from domestic lenders to narrow its budget deficit. The first sukuk could be about $2.7bn, and that issue might then be sold on a monthly basis. Officials in Riyadh have estimated the government could raise about 25-35 per cent of the fiscal deficit this year, which is projected at almost $53bn.

Morocco’s Office National de l’Electricite et de l’Eau Potable (ONEE) has invited consultants to submit proposals for a financial advisory role on the planned $4.6bn gas-to-power project at Jorf Lasfar, which includes a liquefied natural gas (LNG) import terminal and a 2,400MW power plant.

Oil updates

And again we have some important updates from  Saudi Aramco and Abu Dhabi National Oil Company (Adnoc) this week. Aramco said it will complete the first phase of its energy industrial city by 2021. And Adnoc announced plans for a new petrochemicals complex at Ruwais under its Borouge joint venture with Borealis.