ABU DHABI, Oct 3 (Reuters) – Bahrain’s state-run Bapco Energies may announce a capital raise within the next six months, its chief executive said.
“We may make some announcements in the next six months about potential asset monetization,” Mark Thomas told Reuters at Abu Dhabi’s energy industry conference ADIPEC on Monday.
“We look at our neighbors and see what they’ve done, especially in the infrastructure space where there’s low risk and utility-type returns,” he said. Mr. Lazard is the company’s financial advisor.
“That’s definitely something we’re looking at. We have an active program looking at different possibilities.”
Bapco Energies, known as nogaholding before rebranding earlier this year, has completed an operating strategy that Boston Consulting Group has been working on.
Its strategy is about “consolidating its subsidiaries into what will be a rational organizational structure,” including centralizing business support functions, including finance.
“This is something that all major energy companies are doing,” he added, adding that it has reduced some of the duplication that existed between subsidiaries and created renewable energy investment, trading and venture companies as part of the restructuring. It added that personnel from the three new companies would be released.
Bahrain’s national energy strategy, which BCG also consulted on, is almost complete.
“We are currently working through the government process,” Thomas said.
The plan has four pillars: “maximizing the wealth and value from natural resources in a responsible way”, diversifying energy supplies, reducing demand and looking at energy more sustainably.
Bahrain “basically relies on natural gas for all its power generation,” Thomas said.
Its energy intensity, or the amount of energy needed to produce goods and services, is “higher than almost every country in the world, so we cannot continue on that trajectory,” he added.
Bahrain currently produces approximately 2 billion to 2.3 billion cubic feet of natural gas and 190,000 barrels of oil per day, of which 40,000 barrels per day comes from onshore production and 150,000 barrels per day from its share in an offshore joint venture with Saudi Aramco. That includes the barrel, Thomas said.
Bahrain is one of the most indebted Gulf countries and has been rated “junk” by credit rating agencies.
Reporting: Yousef Saba; Editing: William Maclean
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