Bahrain, the smallest economy in the Gulf region, is looking to attract investors for a critical pipeline that carries crude oil from neighboring Saudi Arabia. This move signifies the nation's intent to monetize its energy assets.
According to sources with knowledge of the situation, the Bahraini government anticipates raising several hundred million dollars through the sale of a stake in the pipeline. The conduit, jointly operated by Saudi Aramco and Bahrain's own Bahrain Petroleum Company (Bapco), has a transportation capacity of 350,000 barrels of oil per day. It connects oil processing facilities in Abqaiq, Saudi Arabia, with the Bapco refinery situated in Bahrain.
Representatives from Bapco Energies, the entity responsible for managing Bahrain's energy infrastructure including the pipeline, declined to comment on the matter when contacted by Bloomberg. This news comes on the heels of previous reports indicating that Bahrain was seeking advisors to facilitate the sale of stakes in some of its oil and gas assets. This initiative aligns with the government's broader strategy to open up its energy sector, which has been closed to foreign investment for a significant period.
While Bahrain's energy industry operates on a smaller scale compared to its Gulf counterparts, the nation's officials are determined to emulate the strategies of regional powerhouses like Saudi Arabia and the United Arab Emirates. These strategies involve not only attracting foreign investment but also diversifying their economies beyond their dependence on hydrocarbons.
The news of Bahrain seeking investors for the pipeline coincides with another significant development in the nation's energy sector. The Bahrain Petroleum Company (Bapco) recently announced a partnership with Masdar, a leading renewable energy company from the United Arab Emirates. This collaboration aims to explore and potentially invest in wind energy projects within Bahrain, with a targeted capacity of up to 2 gigawatts. This joint venture marks the initial foray of Abu Dhabi's Masdar into the Bahraini renewable energy market.
By seeking investors for the Saudi oil pipeline and forging partnerships for renewable energy projects, Bahrain is making a concerted effort to both capitalize on its existing hydrocarbon resources and invest in the development of a more sustainable energy future. The success of these initiatives will be crucial for the nation's economic diversification goals.