Russia’s energy minister says cooperation with Saudi Arabia ‘can bring tangible benefits for both sides’

Russian Minister of Energy Alexander Novak believes Saudi-Russian relations are built on more than just oil.
Updated 14 October 2019
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Russia’s energy minister says cooperation with Saudi Arabia ‘can bring tangible benefits for both sides’

  • Russia’s energy minister sees working with Kingdom on oil and gas as the first step toward a ‘new alliance’

MOSCOW: Alexander Novak, Russia’s energy minister since 2012, has overseen the country’s oil and gas industry at a time of great geopolitical and economic change. On the occasion of the visit of President Vladimir Putin to Saudi Arabia, Novak tells Arab News why the Saudi-Russia relationship is about more than just oil — and how the “black swans” will continue to affect the global oil price.

Q: Russia and Saudi Arabia have become much closer in all spheres of activity in recent years. Why is this?

Novak: The expansion of interaction with our Saudi partners along the entire chain of cooperation for us, in essence, is the creation of a new alliance in order to maintain our competitiveness in world markets and to develop the national and world energy in general.

This, in my opinion, is a completely legitimate response towards the current challenges of globalization, which are dictated by the prevailing geopolitical terrain.

Of course, Russian-Saudi cooperation in the past has gone far beyond the frame of energy cooperation intended to stabilize the oil market.

We have taken a pathway towards a consistent increase in the pace of Russian-Saudi trade and economic partnership.

We are engaged in an active dialogue in all sectors of trade and economic cooperation, including agriculture, industry, investment and energy sectors.

As you may know, on June 10 the 6th meeting of the Russian-Saudi Intergovernmental Commission was held in Moscow, as a result of which we noted a significant increase in our cooperation and outlined its new directions and priorities.

From January to June 2019, Russian-Saudi trade turnover increased 28 percent compared to the same period in 2018, reaching $637.7 million.

Q: In energy, what are the common areas of interest?

Novak: Investment cooperation is one of the key growth points for our economic relations. About $2 billion worth of investments have already been made in joint projects in Russia. In this case, we see energy as one of the most promising areas of collaboration.

We have many points of intersection; a number of Russian companies wish to work with Saudi counterparts on the supply and maintenance of oil and gas equipment.

We are conducting preparatory work to develop new breakthrough technologies that will allow us to adapt oil to the current climate and environmental agenda.

In addition, bilateral and international cooperation is important to stabilizing the oil market under the OPEC+ Agreement.

Thanks to our regular meetings, policy coordination between OPEC members and other parties of the Vienna deal is proving successful.

It is important that the practice of such confidential contacts gives appropriate signals to all participants in the oil market, who must be convinced that our commitment to maintaining balance remains unwavering, and we continue to keep abreast of, and monitor, fluctuations in the oil market, preventing its imbalance.

The development of cooperation in the field of raw energy is a good basis for cooperation in other areas.

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Q: Saudi Arabia and Russia have been the leaders of the Opec + alliance that seeks to regulate oil output. Are their interests identical in this project?

Novak: Any union is built on mutual understanding and mutual trust. The OPEC + format is not an exception.

The results achieved are key to the long and painstaking work of its participants, including the cohesion of interests and the search for compromises.

Judge for yourself: At the last OPEC/non-OPEC ministerial meeting, we managed not only to extend the agreements in the framework of the Declaration on Cooperation, but also to switch to a new format of cooperation by signing the Charter for Cooperation of Oil-producing Countries.

This document will serve not only to improve understanding and trust among OPEC and non-OPEC countries. It will also become a basis for joint work on the development of new technologies to adapt oil to the modern climate and environmental agenda, requirements for ensuring global energy security and the implementation of the UN Sustainable Development Goals.

Q: What do you think is a fair price for oil in the global market these days?

Novak: Despite isolated cases of force majeure in the oil market this year, the situation is stable and is under the control of the countries participating in the market.

At the same time, we understand that due to the ongoing pressure on the market of “black swans,” such as trade wars, commodity prices may change in one direction or another.

Q: Not so long ago, Saudi Arabia’s oil facilities were brutally attacked. How do you think this affected the country’s oil sector? What needs to be done in order to stop such attacks in the future?

Novak: Situations such as an attack on facilities in Saudi Arabia lead us to the need to constantly conduct safety assessments at fuel and energy facilities around the world, especially in the Middle East.

Such attacks on large oil suppliers pose risks to global energy security.

What happened clearly showed how quickly the situation on the market can change; at that moment, 5-6 percent of world production left the market and prices jumped by 20 per cent, which is a record increase for at least 30 years.

At the same time, the market recovered in just a week.

I believe, provided that high security at the fuel and energy complex is ensured, and our actions are taken to stabilize the market situation within OPEC +, we will be able to further control the situation and quickly bring it back to normal.

Q: Do you see the basis for the development of gas cooperation between Saudi Arabia and Russia? What can the two countries learn from one another?

Novak: The interest in cooperation with Saudi companies is shown by many Russian oil and gas companies, such as Gazprom and Sibur.

We believe that when finding mutually interesting projects, our cooperation can develop along the entire value chain and can bring very tangible benefits for both sides.

For example, the energy strategy of Russia provides for a several-fold increase in the production of liquefied natural gas — as part of this strategy, our companies are implementing a number of projects that have great prospects in terms of the participation of foreign investors.

In addition, we strive for scientific cooperation — currently the possibility of creating a joint Russian-Saudi institute in the field of energy cooperation is being explored.

Q: What agreements can be expected from Vladimir Putin’s visit to the Kingdom?

Novak: As part of the work of the Joint Intergovernmental Russian-Saudi Commission on Trade, Economic, Scientific and Technical Cooperation, we have prepared a solid list of documents including in the energy field, agriculture, trade and other areas. In total, there are more than 30 documents. A high-level Russian-Saudi strategic cooperation program has been prepared based on the national development priorities of our states.

At the corporate level, I think our countries have already done a lot of work. At the moment within the framework of cooperation between the Russian Direct Investment Fund and the Kingdom of Saudi Arabia Public Investment Fund, investments have already been made in more than 30 projects from various sectors of the Russian economy, including energy, infrastructure, and technology worth over $2.5 billion.

Within the framework of the visit, we expect the signing of a number of agreements and memorandums for an additional $ 1 billion, a significant part of them is in the energy sector. I hope that the new agreements will become the basis for the subsequent strengthening of bilateral cooperation. In the course of painstaking work with the Saudi side, we managed to lay a solid foundation for further progressive development of relations. I am sure that with our partner, the Minister of Energy of the Kingdom of Saudi Arabia; Prince Abdulaziz bin Salman, we will make every effort to further develop Russian-Saudi cooperation.

 


How the hospitality industry in Saudi Arabia is embracing environmental sustainability

Updated 9 sec ago
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How the hospitality industry in Saudi Arabia is embracing environmental sustainability

  • From the Red Sea coast to Al-Ahsa Oasis, new eco-friendly hotels and resorts are opening across the Kingdom
  • Industry leaders are boosting sustainability by cutting emissions, protecting habitats, and creating jobs locally

RIYADH: Saudi Arabia is emerging as a hotspot for international investment. Its latest hook? Sustainable hospitality.

The Kingdom led the Middle East and Africa’s hotel-building activity in 2023, with 42,033 hotel rooms constructed. This accounted for 35.1 percent of the 119,505 built in the region over the year, according to data from hotel monitoring firm STR. 

Saudi Arabia’s hotel segment is projected to generate $2.51 billion in revenue this year and is expected to reach $3.02 billion by 2027, according to Statista.

One of the Kingdom’s Vision 2030 goals is to champion sustainability across all sectors, and in turn, hotels and plazas across the country have been working to implement more environmental and eco-friendly practices in their facilities. 

From 2010 to 2019, Saudi Arabia’s tourism industry has contributed an average of 6.4 percent to the country’s gross domestic product, while recording a decline in greenhouse gas emissions. 

In contrast, the global GDP average for travel and tourism over the same period rose 4.3 percent, and emissions by 2.5 percent.

Several of Red Sea Global’s developments are already up and running along the Kingdom’s northwestern coastline, including the Six Senses Southern Dunes, The Red Sea and St. Regis Red Sea Resort. 

The company recently announced further projects pillared by environmental sustainability. 

The Four Seasons luxury wellness resort, Amaala, Triple Bay, is branded with regeneration and wellness at its core, and is set to feature a one-of-a-kind Corallium marine life institute. 

Saudi Arabia’s Triple Bay AMAALA will soon be home to a Four Seasons luxury wellness resort and is committed to sustainability, aligning with Four Seasons’ longstanding pledge to well-being. (Supplied)

Progress is also being made on a sustainability-focused staff village that will provide housing for those who work at the resort. RSG says that five international operator brands, including Six Senses and Clinique La Prairie, are expected to be confirmed in the coming months.

“Our mission to develop new destinations as beacons of responsible tourism, showcasing the best in sustainable and regenerative development, gains unprecedented urgency as our planet continues to face challenges in relation to the climate crisis and biodiversity loss,” John Pagano, RSG’s group CEO, said in a statement.

The economic zone NEOM recently unveiled three new sustainable hotels in its Leyja oasis, including three flagship Habitas properties, as well as Zardun, a sanctuary resort designed to harmonize with the surrounding ecosystem. 

NEOM’s Hotel Development division has also sponsored Hotelschool The Hague to bring about the Sustainable Hospitality Challenge, bolstering a new generation of innovation in the industry.

Many of the resorts across Saudi Arabia are built to blend in with the surrounding environment. Take AlUla’s Habitas, for example, which boasts the city’s serene desert landscape that immerses guests in its untouched backdrop.

Habitas’ sustainable design and modular construction aim to minimize environmental impacts. It is free of single-use plastics, offsets carbon emissions, and manages waste, recycling and composting. (Supplied)

The luxury resort brand demonstrates its sustainable ethos, in line with the UN Sustainable Development Goals for 2030, through the offsetting of carbon emissions, waste management and a single-use plastic free policy.

“The AlUla Sustainability Charter is at the core of every hospitality project we develop within the destination,” Phillip Jones, chief tourism officer at the Royal Commission for AlUla, told Arab News.

“From the foundational design and materials of construction to the infrastructure, and the ongoing operations, as we only work with international operators that have a proven track record in sustainability, AlUla’s hotels and resorts each contribute toward delivering on our goals, such as achieving net carbon neutrality for local emissions by 2035.”

As the Arab region demonstrates overall lower environmental sustainability due to water scarcity, harsh climate and biodiversity threats, industry leaders are redefining the buzz term to fit local standards.

There are a number of grassroots projects that examine the existing traces of environmental sustainability awareness throughout the Arab region’s history. The Kingdom’s forefathers exhibited community-centered lifestyles, for example, while Islam advises its followers to conserve food and water consumption. 

Chris Nader, CEO and co-founder of luxury ecolodge brand and management company ENVI Lodges, told Arab News: “Sustainability comes from a basis of trying to minimize our negative impacts on the environment. It’s not only nature, or animals — it’s also people.” 

KAEC will host the first eco-friendly coastal resort in the distinguished and captivating Laguna area. (ENVI Lodges image)

ENVI Laguna Bay, a sustainable project developed by Al-Rasim Hotels and Resorts, will occupy a prime Red Sea coast beachfront destination in King Abdullah Economic City, surrounded by mangroves. 

“KAEC will host the first eco-friendly coastal resort in the distinguished and captivating laguna area,” Aiad Mushaikh, CEO of Al-Rasim Hotels and Resorts, said in a statement.

The project strongly aligns with Saudi Arabia’s Vision 2030. Its road map for tourism sector growth includes respecting the land, protecting wildlife, supporting local communities, sourcing mindfully, in-house food production, engaging guests and designing a sense of place. These pillars have been built into the technical guidelines of building the lodge. 

One common belief is that building necessitates the destruction of land. But through its design principles, ENVI demonstrates different approaches that can be taken to minimize its presence within the natural landscape. The company builds low-impact lodges that blend into the environment. 

“We don’t do excavations,” said Nader. “We put our unit on stilts or decks, and we don’t build the units completely on the site so the amount of people and trucks on the site that have to come and go is very limited.”

An important element is also selecting materials from the environment, whether they be wood, rocks or mud, and sourcing materials and products that will maintain durability and integrity over time. 

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The company also champions sourcing a percentage of the ingredients used in its kitchens from in-house gardens, developing programs for wildlife protection and hiring staff from local communities, all of which are tailor-made programs for each lodge.

The whole concept is to assume the project is temporary, aiming to leave the landscape more or less in the same state it was found in. The walkways are not poured concrete, and the native species are planted to cross-pollinate.

Another way to stitch sustainable practices within the fabric of the community is to engage guests in the initiative.

“Today, guests don’t want to be spectators,” said Nader. “They don’t want to be told that the lodge is planting mangroves. They want to plant themselves. Guests want to clean the beach, or the lodges, to remove any litter and plastic and all of that. They want to be involved in saving wildlife and caring.”

Saudi Arabia’s Public Investment Fund recently launched Dan Company, which specializes in agritourism and ecotourism. Architecture and design practice LWK + Partners is working on a project with Dan Co. that aims to invigorate the agriculture industry in Al-Ahsa through hospitality, serving as a benchmark for future projects.

Kerem Cengiz, MENA managing director at LWK + Partners, told Arab News: “Sustainability isn’t just about the reduction of energy; sustainability is also about the way we create places that are harmoniously designed to make the way we interact with them sustainable. 

“We look at sustainability as a holistic offering, rather than a series of tick boxes that we need to achieve.

“It really is important that when we design, we don’t have a pattern book; it still saddens me that we’ve seen many buildings going up that are just glass towers. They express a certain language and vision, but are they desirable in the context of the challenges that we’re facing environmentally?”

He added that the key to bridging these sustainable values into the future of the industry is to focus on a fundamental understanding of technology and innovation. How do you put in sensors that turn off the AC when guests leave the room, for example?

Saudi Arabia is leading the way in many development practices, said Cengiz. The Holiday Inn Tabuk is utilizing solar energy as an alternative power source in some locations, while the InterContinental Jubail carries out voluntary campaigns to clean its beaches.

Like Nader, Cengiz said that private and public developers should move towards sourcing materials that are locally or regionally available. This adds great value not only economically, but also sustainably, by cutting down on products imported from overseas, simultaneously reducing carbon emissions.

He added: “Now, Saudi is developing its own market and its own product lines. I think that, in itself, has a massive impact and I would love to see more attention on that type of thing.

“I think we’re way past the 2030 Vision now. I mean, we’re evolving it much further into something significantly more impactful.”
 

 


Saudi Coffee Co. and Bieder & Maier blend two coffee cultures

Updated 38 min 20 sec ago
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Saudi Coffee Co. and Bieder & Maier blend two coffee cultures

  • Viennese coffee-maker collaborates with local brand to buy Arabica beans from Jazan

RIYADH: The Kingdom and Austria recently celebrated the world premiere of the “Premium Saudi Blend” by Viennese coffee manufacturer Bieder & Maier and the Saudi Coffee Company.

The launch of the product brings Saudi and Austrian coffee culture together. During the presentations in Vienna and Riyadh, guests tasted the new coffee roast, catering for espresso to filter and cold brewing.  

Bieder & Maier collaborates with Jazean brand to become the world's global brand to directly acquire the finest Arabica beans from Jazan. (Supplied)

“The coffee is an embodiment of our culture and identity,” CEO of Saudi Coffee Company Khalid AbuTheeb told Arab News. “With the objective of enhancing the local coffee industry and promoting our coffee tradition, we have collaborated with Bieder & Maier, a Vienna-based coffee powerhouse.”

AbuTheeb said that the collaboration was facilitated by the Saudi Ministry of Investment. “Through this collaboration ... the Saudi Coffee Company will bring forth unique coffee blends utilizing Saudi coffee beans in a mix with international beans to the Saudi and Austrian markets,” he said.

HIGHLIGHTS

• In 2011, Viennese coffee house culture was declared an intangible world heritage, followed by Arabic coffee in 2015 and Saudi Khawlani Arabica beans in 2022.

• They have all been declared intangible world heritage by UNESCO in recognition of their respective traditions and cultural significance.

• Starting during fall this year, a number of coffee houses will be opened in Saudi Arabia, with Cenomi Retail as franchise partner.

According to AbuTheeb, they will supply the finest Saudi coffee beans directly from the Jazan region.

“As we explore roasting capabilities here in the Kingdom, we are not just content with embracing tradition; we are striving to shape the future of coffee, where innovation intersects with heritage on a global scale,” he said.

Dr. Margarete Schramboeck, the former minister of economy and digital affairs of Austria, and current Aramco digital board member, expressed her growing interest in Saudi coffee culture since she moved to the Kingdom.

“It was the year 2022 when I first came to the Kingdom and learned about the Year of Saudi coffee and the amazing culture of growing coffee in Jazan,” Schramboeck told Arab News. “Therefore, I was passionate about bringing this idea of a special Saudi blend to life. An exceptional partnership with the support of the Ministry of Investment of Saudi Arabia has been initiated. I want to thank Minister Khalid Al-Falih and team for the support.”

Recalling her visit to Jazan and its coffee-growing families, Schramboeck said: “The quality and tradition of coffee has deeply impressed me.”

Rudi Kobza, founder and CEO of Bieder & Maier Vienna, stressed the importance of the collaboration. “The Saudi heritage is unique and the ambition of the Saudi Coffee Company is impressive. The Premium Saudi Blend brings this philosophy in an authentical way alive. This can be experienced soon in our first Bieder & Maier cafe in Saudi Arabia, which we will operate with our partner Cenomi, as well as in Vienna.”

“Austrians share a common passion for coffee. Therefore, I was passionate about developing this project. When Saudi Arabia meets Vienna, the home of the Arabica coffee bean combines with the home of traditional coffee house culture to create a particularly enjoyable coffee project.”

In 2011, Viennese coffee house culture was declared an intangible world heritage, followed by Arabic coffee in 2015 and Saudi Khawlani Arabica beans in 2022. They have all been declared intangible world heritage by UNESCO in recognition of their respective traditions and cultural significance.

Starting during fall this year, a number of coffee houses will be opened in Saudi Arabia, with Cenomi Retail as franchise partner.

 


Excavators held for violating water system

Updated 26 April 2024
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Excavators held for violating water system

  • The discovery was made during field tours carried out by the water department

TUBARJAL: The Al-Jouf branch of the Saudi Ministry of Environment, Water and Agriculture has apprehended three excavators who were found to be violating the water system in Tubarjal.
The discovery was made during field tours carried out by the water department, in cooperation with the competent authorities in the governorate.
Separately, authorities in Addayer in the Jazan region have arrested seven Ethiopians for smuggling 105 kg of hashish. Legal procedures have been completed against the offenders who were handed over, along with the seized items, to the competent authority.
Border guard patrols in the Al-Harth area of Jazan have also foiled an attempt to smuggle 71 kg of hashish, with initial legal procedures completed and the find handed over to the competent authority.
Security authorities have reiterated their appeal for citizens and residents to report any information regarding drug smuggling or selling by calling 911 in Makkah, Riyadh, and the Eastern Region, and 999 in the rest of the Kingdom’s regions.
Those with information may also contact the General Directorate of Narcotics Control at 995 or at [email protected].


48th Saudi relief plane for Palestinians

The aid is part of the humanitarian and relief efforts provided by Saudi Arabia through KSrelief. (SPA)
Updated 35 min 38 sec ago
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48th Saudi relief plane for Palestinians

  • The plane carried shelter materials to be transported to the conflict-affected Palestinians in the Gaza Strip

AL-ARISH: The 48th Saudi relief plane for Palestinians in Gaza arrived on Friday at Al-Arish International Airport, Egypt.

It was operated by the King Salman Humanitarian Aid and Relief Center, in coordination with the Saudi Ministry of Defense.

The plane carried shelter materials to be transported to the conflict-affected Palestinians in the Gaza Strip.

The provision of aid is ongoing from the Kingdom, which has stood firm with the Palestinians amid crises and tribulations.

 


Direct KSA to Iraq flight routes announced

Updated 26 April 2024
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Direct KSA to Iraq flight routes announced

  • These flights, along with flights to Baghdad and Irbil, will commence from June 1.

RIYADH: The Saudi General Authority of Civil Aviation announced the launch of direct flights from Dammam to Najaf, the Saudi Press Agency reported on Friday.
The decision is in line with the Kingdom’s national aviation sector strategy, aimed at doubling capacity to accommodate over 330 million passengers annually, and extending services to more than 250 global destinations.
These flights, along with flights to Baghdad and Irbil, will commence from June 1.