The Middle Eastern and North Africa (MENA) countries will invest 755 billion dollars in energy projects in the next five coming years despite the falling oil prices, according to an economic study released on the 4th February 2015.
Approximately 42% of these investments of USD 316 billion will be spent in power generation, 31% from oil and 27% from gas, says the study of Arab Petroleum Investment Corp. (APICORP), an institute based in Saudi Arabia. The other $316 billion is projected to be invested in power generation to meet soaring demand for electricity, which is heavily subsidized in most regional states.
The investments projected over the period of 2015-2019 are slightly lower than what was projected in the previous period of 2014-2018 of (USD 760 billion), it has added.
The MENA region includes all Arab countries and Iran, which are mostly rich in energy resources.
More than three quarters of the investments will be spent by eight countries: Saudi Arabia, UAE, Algeria, Iraq, Iran, Kuwait, Qatar and Libya. These countries are the largest holders of oil and gas reserves, said the study.
The United Arab Emirates comes in second place with investment projections of $116 billion, followed by Algeria with $84 billion. Iraq and Iran are forecasting to invest around $80 billion and $70 billion, respectively.
APICORP projected that the demand for electricity in the region would grow by 8.3 percent a year, unless governments took steps to substantially cut subsidies to consumers.