LONDON: A Qatari company’s refusal to settle a £200 million bill for work linked to the 2022 World Cup is at the heart of controversy surrounding UK construction company Carillion’s collapse.
During a select committee hearing on Tuesday, MPs grilled Carillion bosses on the company’s decision to enter such a “complex commercial environment,” and questioned their fitness to be “let loose” on other companies in the future.
The firm behind the delayed £5.5 billion downtown development, Msheireb Properties, is backed by the government-supported Qatar Foundation.
Carillion’s ex-chairman Philip Green, said the board had been trying to mitigate the “geographic risk” in the run-up to the company’s collapse on Jan. 15 and pulled back on plans to expand in the region.
The Qatar contract was cited as one of three major projects, alongside hospitals in Liverpool and Birmingham, that capsized the UK company, which employed around 43,000 people worldwide, including 20,000 in Britain.
During the hearing, Carillion executives said the company is owed £200 million for work on the Doha development, which was originally due for completion in May 2017.
Former chief executive Richard Howson said the completion date, now set for December this year, was continually pushed back. He told MPs that it has been “a very difficult project,” with the client changing architect three times and issuing 40,000 drawings in eight months.
Howson described shuttling back and forth to Qatar ten times a year in an attempt to settle the bill but ultimately failed to obtain payment for the project. “I felt like a bailiff,” he said.
Keith Cochrane, who took over as chief executive in July, said he also tried to “achieve a settlement” on the bill, which remains unpaid. He claimed Howsen confirmed the Qataris would pay up in board meeting last April but said: “Six weeks later the world had changed and it wasn’t paid.”
Carillion bosses also pointed the finger at Brexit and a snap election in 2017 as they fielded fierce questions from MPs, who branded them “delusional characters.”
A statement released by MPs after the hearing said:
“We heard variously that this was the fault of the Bank of England, the foreign exchange markets, advisers, Brexit, the snap election, investors, suppliers, the construction industry, the business culture of the Middle East and professional designers of concrete beams.
“Everything we have seen points the fingers in another direction — to the people who built a giant company on sand in a desperate dash for cash.”
Carillion, one of the largest contractors operating in the Middle East, was involved in a number of high-profile projects across the region, including the Dubai Canal and the Royal Opera house in Oman.
Doha debt behind controversy over Carillion demise
Doha debt behind controversy over Carillion demise
OPEC+ extends oil output cuts into 2025
LONDON/DUBAI: The Organization of the Petroleum Exporting Countries and its allies, known as OPEC+, on Sunday agreed to extend most of its deep oil output cuts for 2024 but to start phasing them out in 2025
The decision seeks to shore up the market amid tepid global demand growth, high interest rates and rising US production.
Oil prices trade near $80 per barrel, below what many OPEC+ members need to balance their budget. Worries over slow demand growth in top oil importer China have weighed on prices alongside rising oil stocks in developed economies.
OPEC+ have made a series of deep output cuts since late 2022. The alliance’s members are currently cutting output by a total of 5.86 million barrels per day, or about 5.7 percent of global demand.
The cuts include 2 million bpd by all OPEC+ members, the first round of voluntary cuts by nine members of 1.66 million bpd, and the second round of voluntary cuts by eight members of 2.2 million bpd.
OPEC+ extended the first round of cuts until the end of 2025 from the end of 2024, the group said in a statement.
It also agreed to extend the third round of voluntary cuts into the third quarter of 2024, OPEC+ sources said, adding that more details were being worked out and would be announced on Sunday.
The countries which have made voluntary cuts in the second round are Algeria, Iraq, Kazakhstan, Kuwait, Oman, Russia, Saudi Arabia and the UAE and Gabon. The same countries except Gabon participated in the third round.
The group also agreed to allocate the UAE a higher production quota of 3.5 million bpd in 2025, up from the current level of 2.9 million.
OPEC+ also postponed the deadline for an independent assessment of its members’ production capacities to the end of November 2025 from June 2024. The figures will be used as guidance for 2026 reference production levels.
OPEC+ will hold its next meeting on Dec. 1, 2024.
Saudi Arabia embraces advanced project management model to drive Vision 2030 objectives
RIYADH: An evolved project management office model, often called xMO, is crucial for promoting the outcomes of programs and initiatives, a leading official from Saudi Arabia’s Public Investment Fund has told an industry gathering.
Speaking at the Global Project Management Forum in Riyadh, Areej Naqshbandi, head of the Project Management Office at the entity, said that the shift toward xMO offers organizations an opportunity to achieve their goals more effectively.
According to the Project Management Institute, xMOs enhance value flow in organizations by prioritizing outcomes over processes.
“I would like to focus on a new trend of turning PMOs into xMO. A PMO typically focuses on processes, governments and project execution, while xMOs promote outcomes and value delivery,” said Naqshbandi.
She added: “This shift toward xMO is not just a trend, it is an opportunity that organizations can embrace to gain a powerful toolkit to achieve ultimate goals in several ways. xMOs ensure a faster return in investments for projects by streamlining processes and encouraging adaptability.”
An xMO indicates advanced PMOs focusing on value delivery rather than just project execution. As a result, these xMOs are often called by different names and are distinguished by their flexibility, supportive mindset, and strategic acumen.
The PIF official further noted that Saudi Arabia’s sovereign wealth fund exemplifies the xMO approach, as the Kingdom uses this method to achieve the goals outlined in Vision 2030.
“We are constantly implementing new innovative trends, solutions and strategies; spearheading the drive toward achieving Vision 2030 goals,” she added.
Naqshbandi further pointed out that Saudi Arabia’s PMO is fostering a strong project management ecosystem in the Kingdom.
“We always emphasize the importance of the community and giving back. We believe in sharing knowledge and expertise to make a positive impact in the project management landscape,” she concluded.
Badr Al-Dulami, Saudi Arabia’s vice minister at the Ministry of Transport, stated that the Kingdom’s project management strategy intersects all sectors and is building an inclusive ecosystem.
“It’s a great sense of pride to see Saudi Arabia with its ambitious vision, leading both globally and locally, as we increase the growth of our giga projects throughout the Kingdom. Vision 2030 is a journey of an ambitious nation and not a final destination,” said Al-Dulami.
The GPMF, which began in Riyadh on June 2, is widely considered a flagship forum for project management professionals.
This annual event is expected to attract over 2,000 participants, including project managers and diverse stakeholders.
Saudi entrepreneurs launch fintech startup to spur open banking growth in GCC
JEDDAH: Fintech startup Thimsa aims to streamline business payments with direct bank transfers as it launches a beta platform in the UAE and Bahrain, targeting the region’s open banking growth.
Co-founded by two Saudi entrepreneurs along with a financial expert, the startup seeks to facilitate instant B2B pay-ins and payouts, while also offering eInvoice and subscription features.
The projected growth of open banking in the Gulf Cooperation Council countries has motivated Rayan Azab and Salah Khashoggi to partner with Dubai-based fintech entrepreneur Ash Kalra to spearhead this venture after four years of market research.
This comes as open banking is projected to account for over $124 billion worth of transactions in the GCC region alone by 2031, up from $14 billion in 2020, with an annual growth rate of 22 percent, according to a report by Allied Market Research.
Sharing the story behind Thimsa with Arab News, Azab said: “The journey took about three to four years, but realistically, we started this year with the different experience we have.”
He added that they have studied the market and know that fintech usage in the region is one of the highest in the world thanks to a young, vibrant generation across the GCC.
“We have advised and partnered with in a couple of other fintech companies, and then we decided (to found the company) since the open banking regulation has been implemented in the last few years,” Azab said.
The entrepreneur added that the process has become easier over time, highlighting their decision to enter the open banking sector now as the reason behind founding Thimsa. He noted that the partners possess diverse experiences, which he believes will contribute to their success.
“We are three partners. Kalra has fintech experience in Canada and the US for over 12 years, and I have been in the business world for over 14 years. Additionally, I have an advisory company aside from Thimsa. Salah Khashoggi, founder of Tamra Capital, is also part of our team and brings his expertise from Saudi Arabia,” he added.
Through open banking, the company states that its platform can access shared financial data via 350 integrated APIs, enabling businesses to streamline processes, create personalized financial services, and adapt to ever-evolving customer needs.
Additionally, the fintech firm emphasized that its solution can accept payments in over 60 currencies from more than 150 countries.
Explaining their decision to launch the payment management platform in the UAE and Bahrain first, Azab told Arab News that they wanted to test it in smaller markets before entering larger ones like Saudi Arabia.
He added that they are aligning their efforts and developments with the regulatory changes and expansions made by the local regulator as it enhances its framework.
“Saudi Arabia has recently advanced its open banking initiatives and is poised to become a regional leader in open banking," he explained.
Highlighting the potential impact of open banking growth in the GCC on their trajectory, Azab mentioned that the segment is already established in the region, and they are not introducing something entirely new.
“We are just revamping it. Thimsa is going to come and help small businesses that cannot afford to just go and do the huge accounting or whatever,” he said, adding that they will be adding value to these businesses.
Talking about their platform, he explained that the technology features instant payment management, corporate management, and most importantly, business-to-business and customer-to-business features.
Azab concluded by stating that they have encountered many challenges, but they have gained significant experience in understanding the market and its growth trajectory. Additionally, he mentioned that they are working closely with regulators.
Envisioning the platform changing the financial services landscape for GCC businesses, Khashoggi told Arab News that the region, particularly Saudi Arabia, is undergoing a massive transformation in fintech and financial inclusion.
“We want to focus on enabling SMEs (small and medium enterprises). So, the idea behind Thimsa is how to help all these SMEs, making financing available to them in addition to easing their operations. All of this is a result of open banking,” Khashoggi said.
The co-founder added that without open banking regulations in Saudi Arabia, they could not have or even come up with something like Thimsa.
Speaking about their future expansion plans, Khashoggi emphasized that their primary focus is on product development. He explained that once they have demonstrated success in Saudi Arabia and the GCC region, they will aim to expand their product offerings to the global market.
He pointed out that the beauty of fintech lies in its integration with the digital economy, making it one of the most easily exportable products globally. However, he noted that it is crucial to remain attentive to market demands.
“So, if you want to expand to any other market, you need to localize the product to fit their needs,” he said.
He emphasized that their strategy involves perfecting their product here in Saudi Arabia first before confidently venturing into international markets.
Asked how Thimsa can ensure the security and privacy of its users’ information, given the extensive use of financial data, he stated that this is entirely under the control of the regulator.
“The regulator sets the bar very high when it comes to sharing any data. We are entrusted by our clients with their data for their benefit. We are not going to take it and use it or sell it or do anything with it. All of that is not allowed by the regulations. We will only use it for the benefit of the client,” he said.
For his part, Kalra described Thimsa as a state-of-the-art financial management platform, emphasizing that it is based on the core principles of open banking and finance.
“Open banking aligns very well with the Vision 2030 in Saudi Arabia, and it runs on real-time payment rails. So that means it spurs innovation, growth, and inclusiveness all across the market,” he said.
Highlighting the open banking landscape in the GCC market, particularly in Saudi Arabia, and discussing whether they will be competing with banks, Kalra commented: “Open banking is a technology which allows banks to share their data with third parties like us, which spurs innovation and growth in the market.
“For the Saudi market, that’s a huge deal. So, one of the pillars of Vision 2030 is diversifying the economy, and open banking just does that,” he said.
Kalra added that it allows the incumbent banks to work with third parties like them, and said: “So we are not competing against the banks, we are actually working with them.”
Describing the technology and how their platform would make payment management easier, he said that Thimsa uses a microservices architecture and API-based technology.
“We collect a lot of data from the bank on the businesses and consumers and innovate around it. So, that is a key technology that Thimsa uses,” he concluded.
Saudi youth set to lead the charge for project management: PMOGA MD
RIYADH: Saudi Arabia’s drive toward a brighter future is significantly impacting today’s youth and tomorrow’s leaders in the project management sector, according to a top official.
Speaking to Arab News during the Global Project Management Forum in Riyadh, Americo Pinto, managing director of the Project Management Office Global Alliance, highlighted the young people in the Kingdom as the cornerstone for substantial development.
The two-day annual event being held in the Saudi capital highlights the latest developments in the field of project management across various sectors and is set to attract more than 2,000 participants.
Pinto observed a proactive approach in the region toward preparing future leaders, and said: “I really see a region and a country (Saudi Arabia) that is looking to prepare their leaders for the future, and the future is now.”
He added that he believes the impact of the investments and cultural changes will be evident for years to come.
Reflecting on the region’s unique energy and enthusiasm for project management, Pinto stated: “It’s something that is interesting to observe from a little distance, especially comparing with other regions where maybe we have project management as something more mature in terms of topic.
“But here I feel a different kind of energy and it makes me really happy because it’s great to be part of it.”
Pinto expressed a particular enthusiasm for working with individuals from the Middle East, specifically Saudi Arabia.
“I have a special joy in working with people from the Middle East and Saudi Arabia. I see people, especially young leaders, seeking knowledge and exchange experience,” he remarked.
Pinto further highlighted that the Middle East region currently holds the highest number of PMOGA members, indicating great potential for PM development.
Moreover, Pinto stated that Saudi companies have been an active participant in the annual PMO Global Awards, with the Kingdom’s Saudi Post, also known as SPL, winning the World PMO of the Year in 2023.
“It’s interesting that each year we have more companies from Saudi Arabia participating. Last year, we had nine, this year we have 20. I don’t know, but in a few times, it will become the Saudi Arabia awards,” he quipped.
Speaking about industry trends, Pinto explained that artificial intelligence represents the most significant trend in the project management sector.
The technology presents a multitude of possibilities and is rapidly becoming essential for companies seeking to enhance their operations and overall results, he explained.
“Every company should embrace AI as a great possibility to increase activity and results as a whole,” Pinto noted, emphasizing the transformative potential of AI in the project management office.
Pinto added, “PMO leaders should be very concerned about that (AI), but as I said, in a positive way, because it can bring a lot of benefits for any PMO.”
He highlighted the importance of PMO leaders recognizing AI’s potential to significantly impact their area, ultimately leading to greater efficiency and effectiveness in project management.
Pinto anticipates that AI will be used for calculating possibilities and predicting outcomes in recent years.
“AI is something that will change the game. It will enable us to do things we cannot do today,” he stated.
Founded in 2017, PMOGA is a global community with more than 17,000 members in more than 125 countries. The alliance was acquired by the Project Management Institute, the leading authority in project management, earlier last year.
Global LNG supply to increase by 80% by 2030: Goldman Sachs
RIYADH: The global liquefied natural gas supply is set to surge by 80 percent by 2030, driven by new projects in Qatar and North America, a new analysis showed.
In its latest report, Goldman Sachs said that this robust rise in supply would bring an end to the current energy crisis following Russia’s invasion of Ukraine.
The US-based financial services firm also highlighted that investments in LNG are projected to increase by over 50 percent by 2029.
Michele Della Vigna, Goldman Sachs’ head of natural resources research in Europe, the Middle East and Africa, said: “LNG in the US, without any doubt, is dominating future supply and we believe that the capacity growth in LNG is going to bring an end to the energy crises that began a couple of years ago, following European sanctions on Russian gas after the invasion of Ukraine, and work to lower natural gas prices in Europe and Asia.”
He added: “We’re projecting an 80 percent increase in global LNG supply by 2030, which will be driven by new projects in North America and Qatar.”
In January, QatarEnergy signed an agreement with US-based Execelerate Energy to supply up to 1 million tonnes per annum of LNG to Bangladesh for 15 years.
Similarly, in February, Qatar’s state-owned firm signed another agreement with Petronet to supply 7.5 mtpa of LNG to India for a period of 20 years.
In the same month, QatarEnergy chief Saad Al-Kaabi announced a new expansion of its LNG production in the North Field, which will add a further 16 mtpa to existing capacity, bringing total production to 142 mtpa.
The Goldman Sachs analysis further pointed out that the oil and gas industry is undergoing a major transformation as it braces for the eventual long-term decline in crude demand and rising global need for natural gas.
According to the report, oil companies are still likely to reap attractive returns for shareholders, as well as good per-share growth if crude prices stay between the range of $80 to $90 per barrel.
Goldman Sachs highlighted that capital expenditure in the oil and gas industry grew at about 11 percent a year from 2020 to 2023, but it is likely to level off to around 4 percent a year from 2023 to 2026.
The analysis suggested the Organization of the Petroleum Exporting Countries is likely to maintain its current production discipline for the next few years.
“In the next two to three years, there is very little opportunity for OPEC to increase production capacity without rocking the market. We think non-OPEC production will peak this year, and then OPEC can potentially begin increasing its market share as decline rates rise and the project pipeline normalizes,” added Goldman Sachs.
