Industries Qatar (IQ) plans to invest around QR11.1bn for capital expenditure for the next five years (2022-2026), said a senior official addressing Annual General Assembly Meeting of IQ. The Group is also evaluating a possible new energy efficient ammonia train investment that will replace a pair of existing ammonia trains which were in operations over the last five decades.
Minister of the State for Energy Affairs, Chairman of the Board of Directors and Managing Director, Industries Qatar H E Saad Sherida Al Kaabi, said that Industries Qatar (IQ) continued the efforts, during last year, towards achieving operational excellence by focusing on our people, ensuring plant reliability and our commitment to HSE.
He was addressing the shareholders during the Annual General Assembly Meeting of IQ held, yesterday.
The AGM approved the Board’s recommendation for a dividend payment of QR1 per share for 2021, representing 100 percent of the nominal share value. The Extraordinary General Assembly Meeting approved an amendment to increase the non-Qatari ownership limit in the Company’s share capital from 49 percent to 100 percent, ensuring that all relevant requirements are fully met.
“During the year 2021, with macroeconomic sentiments remained positive, we continued our efforts towards achieving operational excellence by focusing on our people, ensuring plant reliability and our commitment to HSE. We remained successful, during the current year, in realizing financial and operational benefits of all the strategic decisions taken last year in order to create and preserve long-term shareholder value,” he said.
“Our strategic investment of $1bn to take full ownership in QAFCO has served us well, with results in excess of our expectations. Similarly, mothballing certain steel facilities during 2020 allowed us to focus on more profitable domestic and selective international markets, and benefited the Group with improved profitability and better plant reliability,” he added.
He said that the Group continued its maintenance programs as planned to ensure safe, efficient, and reliable operations with consistent production and carried out various planned shutdowns required at different facilities.
Also, with the current supply chain crunch situation, seized global markets throughout the year, the Group’s marketing and logistics arm worked closely with relevant producing entities to steer Group entities through these challenging times, while ensuring our volumes remained unaffected without disrupting operations, he added.
He said that the year 2021 was marked by improvement in conditions at the macroeconomic level, and a progression of societal reopening which led to a renewed demand for our downstream products. This year also witnessed shortages in supply and logistical obstacles.
“This demand recovery along with limited supply allowed commodity prices to recover notably from last year’s troughs. Moreover, recent energy crisis and power rationing measures in key markets has also supported elevated price trajectories for commodities,” he said.
Addressing the shareholders, Manager Privatized Companies Affairs Dept., QatarEnergy, Mohammed Jaber Al Sulaiti said, “Total capital expenditure for the year was primarily related to turnaround, reliability, and health, safety and environmental projects across different segments and amounted to QR1.3bn. For the next five years (2022-2026), Group’s planned capital expenditure will be around QR11.1bn. The Group will continue to focus on capital expenditure programs with a critical importance to asset integrity, operational efficiency, reliability improvements, cost optimization and capacity de-bottlenecking”.
He said that the year 2021 has turned out to be one of the most successful year for the Group since inception, after witnessing an unprecedented challenging time during last year being impacted by adversities of COVID-19.
The economic recovery that from the latter part of 2020, backed by societal reopening and recovery of markets in light of government spending aided greater consumer participation and led to a notable increase in demand fordownstreamcommodities.
“As the Group benefitted from a momentous economic recovery, we continued to consolidate our position of being a low-cost operator which contributed to our competitive edge and supported us in achieving one of the strongest results,” he added. “During the year, we started to realize results from the strategic decisions taken during a pandemic year, which has not only enhance our competitiveness, but also positioned us with stronger footings for any future challenges,” he said.
The decision to acquire remaining stakes in QAFCO and QMC taken last year has turned out to be above our expectations, given the current industry upcycle.
“Our decision to mothball certain steel facilities to mainly focus on our local markets, has turned out to be beneficial with better profitability, where our strategic focus shifted towards improving profitability rather volumes,” he said.
