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  Petrofac completes sale of Abu Dhabi business unit

  1 June 2026

  UK-headquartered Petrofac has completed the sale of Petrofac Emirates, a business unit it established in Abu Dhabi in 2008.

  The unit has been bought by a consortium of financial investors led by the New York-headquartered hedge fund Mason Capital Management and UK-based asset management firm Pearlstone Alternative.

  In a statement, Petrofac said the sale was completed after the satisfaction of all required conditions and approvals.

  The business unit was originally founded with a strategy to provide engineering, design, procurement and construction services for oil, gas, refining, petrochemical and renewable energy projects.

  Petrofac Emirates has engineering and construction (E&C) capability and includes E&C teams based in the UAE and India.

  In its latest statement, Petrofac said: “Petrofac Emirates encompasses Petrofac’s core E&C capability in the UAE.

  “The transaction positions Petrofac Emirates as a strong, self-sustaining company with no funded debt on its balance sheet and substantial growth opportunities.”

  Leadership role

  Under current plans, Tareq Kawash, who has been the group chief executive of Petrofac since April 2023, will become the chief executive of Petrofac Emirates to lead the E&C business through its next phase under new ownership.

  Kawash has over 30 years of international leadership experience at engineering procurement and construction (EPC) companies.

  Prior to working at Petrofac, he was a senior vice-president at McDermott International.

  Following the completion of the sale, Afonso Reis e Sousa will step down as group chief financial officer of Petrofac.

  Commenting on the sale of Petrofac Emirates, Kawash said: “The completion of this transaction marks an important milestone for Petrofac Emirates and the beginning of an important new chapter for the business.

  “Under our new ownership structure, with a focused platform for growth, we are well-positioned to build on our track record, strengthen our long-standing customer relationships and pursue new opportunities across the wider Mena region.

  “The transaction is not the destination; it is the platform from which we move forward with confidence, discipline and ambition.”

  Sam Read, a partner at Mason, said: “Our mission is to empower Petrofac Emirates to achieve its strategic goals, capitalise on new market opportunities, and leverage significant growth potential in the dynamic energy EPC sector.

  “Petrofac Emirates has market-leading capabilities and an unmatched track record of delivering for its customers, and we look forward to partnering with the company to help drive continued success.”

  The sale of Petrofac Emirates follows the completion of the sale of Petrofac Asset Solutions in April.

  In December, it was announced that US-based CB&I had entered into a sale agreement to buy the unit.

  Petrofac’s asset solutions unit provides operations, maintenance and decommissioning services for onshore and offshore energy assets.

  In a statement, CB&I said that the acquisition would strengthen its portfolio with “a complementary reimbursable contracting model business, delivering predictable cash flow and enhancing service capabilities”.

  Restructuring disruption

  Amid Petrofac’s dramatic restructuring, there has been disruption to progress at some of the company’s projects.

  In March, MEED reported that Petrofac, along with its partner China Huanqiu Contracting & Engineering Corporation (HQCEC), had stopped work on a petrochemicals project in Algeria, valued at approximately $1.5bn.

  The news about the Algeria project came just over two weeks after MEED reported that Petrofac had also stopped work on an oil project in Libya and cut staff in the North African country.

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  Wil Crisp
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  Chinese-Saudi joint venture to build 18GWh battery storage plant

  1 June 2026

  China-headquartered ZOE Energy Storage has announced it has signed a joint-venture agreement with a Saudi partner to develop a battery energy storage system (bess) manufacturing facility in the kingdom.

  The facility will be developed in two phases. The first phase will have an annual production capacity of 6GWh and is scheduled to begin operations in the first quarter of 2027.

  A second phase will increase the total production capacity to 18GWh.

  In a statement, ZOE said the manufacturing facility will cover 150 acres and will be built to European manufacturing standards.

  The location and the partner involved have not been publicly disclosed.

  The Saudi facility will be the Chinese company’s second overseas manufacturing base, following a 6GWh energy storage system manufacturing facility in Hungary. This was developed with Energy Pro Hungary and began operations in October 2025.

  Under Saudi Arabia’s Vision 2030 objectives, the kingdom plans to deploy 130GW of renewable energy capacity and 48GWh of energy storage and achieve 50% clean power generation.

  In May, Saudi Arabia’s principal buyer, Saudi Power Procurement Company, received statements of qualification from firms seeking to build, own and operate a second group of bess projects with a combined power capacity of 3GW.

  The programme comprises six independent storage provider projects with a total capacity of 3GW, equivalent to 12,000 megawatt-hours based on a four-hour storage duration.

  The main contract tender is expected to be issued in the coming months once firms are formally prequalified.

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  Mark Dowdall
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  Middle East stocks recover unevenly

  1 June 2026

  

   

  The combined market capitalisation of the MEED Top 100 largest listed companies in the Middle East and North Africa rose to $3.73tn in mid-May 2026, against $3.48tn a year earlier – a 7.2% gain that recovers most of the value lost in the prior two years’ editions. The aggregate is not the story.

  Saudi Aramco recovered by $181bn, rising from $1.64tn to $1.82tn and providing substantial support to the aggregate Top 100 valuation. The broader movements in the list differentiated along sectoral lines, with key trends including the continued growth of regional banks, the upward repricing for fertiliser and logistics names amid the Hormuz crisis, and the correction of Saudi mid-tier stocks as valuation peaks have failed to hold.

  Oil and gas reweights

  Aramco’s share price recovered from about SR25 to SR30, lifting the company’s market cap by 11% and raising the oil and gas sector’s share of the list back to 54.5%. 

  The company reported first-quarter 2026 net profit of $32.5bn, up 25%, on revenue of $115.5bn – giving it a price-to-earnings ratio of about 18, in line with the Saudi market average as of April. 

  Aramco’s diversion of crude to Yanbu through its 7 million-barrels-a-day West-to-East pipeline has supported a higher volume of sales at the now elevated prices compared to its Gulf peers, the exports of which have been more seriously affected by the blockade of the Strait of Hormuz.

  Other Saudi names also benefiting from this combination of ongoing access through Yanbu and energy repricing produced the cleanest gains, with Rabigh Refining more than doubling in value to $11.7bn despite a $1.1bn loss, Ades Holding rising 40% to $5.8bn, Luberef rising 28% to $5.8bn and Yansab also seeing double-digit returns. 

  In the UAE, by contrast, Adnoc Gas has remained broadly flat at $66.7bn, with its Q1 2026 net income dropping 15% and conflict damage estimates indicating that full capacity will not be restored until 2027. Borouge meanwhile held, while Adnoc Drilling and Adnoc Distribution gained by 14% and 8%, respectively. 

  There was some slippage in the petrochemicals sub-cluster, with Saudi Basic Industries Corporation (Sabic) posting a net loss of $6.96bn and sliding 3%, alongside a 2% slide for the energy sector-adjacent Industries Qatar.

  Banking and industry

  The banking sector, which accounts for 33 of the 100 entries and 18% of the list by value, expanded by an aggregate 6.3% in absolute terms. Al-Rajhi Bank, the largest banking entry at $107.9bn, reported FY2025 net profit up 26% to SR24.8bn ($6.6bn); total assets passed SR1tn for the first time and Q1 2026 net profit rose a further 14%. 

  Emirates NBD, up 23% year-on-year to $47.1bn, reported FY2025 record profit before tax of AED29.8bn ($8.1bn) and likewise crossed AED1tn in total assets. 

  Kuwait Finance House also rose by 19%, Abu Dhabi Commercial Bank 19% to $28.7bn and Saudi National Bank 11%. Qatar National Bank stalled and slid 1%, while several smaller banks saw gains. Egypt’s Commercial International Bank rose 74% to $8.4bn off a depressed base, Jordan’s Arab Bank meanwhile rose 55%, Oman’s Bank Muscat by 52% and RakBank by 32%. 

  Several sectors have gained significantly owing to their direct exposure to the Iran conflict’s supply-chain repricing, including logistics, fertilisers and mining. 

  Logistics firms in the list gained 44% in absolute terms, with Saudi Arabia’s Bahri reporting Q1 2026 net profits up 303% year and revenue up 129%. 

  Marsa Maroc, the Casablanca-listed port operator, also entered the list at $6.6bn, up 85% on an African expansion that spans 34 terminals across 20 ports following a Liberia management deal signed in February. 

  Adnoc Logistics rose 32% to $11.6bn, while Air Arabia, the Sharjah-based low-cost carrier, joined the list at $6.1bn as it absorbed redirected long-haul flows. Nakilat, the Qatari liquefied natural gas shipping operator, was the sector’s sole softener, down 12% on slower throughput.

  Mining and fertiliser entries sit alongside the logistics gainers. Jordan Phosphate Mines is the cleanest single expression of the post-Hormuz repricing visible on the list – up 127% year on year to $13.2bn, as the World Bank’s April 2026 Commodity Markets Outlook projects fertiliser prices to rise nearly 31% in 2026. 

  Maaden rose 23% to $65.3bn after FY2025 net profit jumped 156%, backed by record phosphate production; high aluminium output; and rising silver, copper and aluminium prices linked to artificial intelligence, data centre, solar and electric vehicle demand. 

  Morocco’s Managem also entered the list at $19.7bn, having almost tripled in value in the past two years on cobalt, silver and copper prices and African expansion. 

  Sabic Agri-Nutrients rose 44% on a 30% 2025 net profit increase, while Fertiglobe rose by 40% – both potentially anticipating a 60% forecasted rise in urea prices.

  Property and other trends

  The direction of the property and real estate sector has been uniformly downward. The Iran conflict has driven both a slump in UAE property sales and prices and a similar tourism-adjacent correction in Saudi Arabia. Both the Mecca-focused Umm Al-Qura and Jabal Omar development firms have seen their valuations slashed by more than a third, while Makkah Construction & Development slid by 15%. 

  The UAE’s Emaar Properties and Dar Al-Arkan and Qatar’s Ezdan Holding have also all seen slides of more than 15%. Kuwait’s Mabanee, which rose by 22%, is the one exception in the sector.

  In Saudi Arabia’s mid-tier, Acwa Power shed 29% in value even as its revenue rose 18% and its net income 5.4%. Elm Company likewise shed 33%, Dr Sulaiman Al-Habib 19% and the Saudi Tadawul Group 21%. 

  Mouwasat Medical Services, MBC Group, Nahdi Medical and Saudi Logistics Services fell out of the list entirely on the same trajectory. Each had reported FY2025 earnings rises before the decline. What corrected was the valuation, not the operations.

  Acwa Power’s trailing four-quarter average price-to-earnings ratio was 166x, and even after this year’s decline sits at 88x against the Saudi market average of 17.8x. Elm sits at 26x, Al-Habib at 33x, Saudi Tadawul Group at 42x – all rich by any comparable benchmark.

  Many of these entries have fallen away from their peak valuations as the cooling of the gigaproject programme since early 2025 has undermined sentiment. 

  One example that sits on the same axis from the UAE side is Abu Dhabi National Energy Company (Taqa), which fell by 28% from $95.3bn to $69.0bn despite a 6% net income rise, even as capital expenditure also expanded by 50%.

  There are now nine entries from Morocco’s Casablanca bourse against six a year ago, with an aggregate value of $74.7bn, up from $50.8bn. Industrial contractor Societe Generale des Travaux du Maroc,entered via a December 2025 initial public offering (IPO). Several Moroccan stocks have also slipped, however, including Taqa Morocco, down 42%; Maroc Telecom, down 18%; Banque Populaire, down 13%; and Bank of Africa, down 10%.

  There has been a similarly divergent trend among 2024 IPO entrants. While OQ Exploration & Production rose 68% to $10.1bn and is now the largest stock on the Muscat Securities Market, the UAE’s Talabat – 2024’s second-largest IPO at $9.2bn – has corrected 33% to $6.1bn.

  The Multiply Group has been replaced on the list through its November 2025 merger into 2PointZero Group, which now sits in the top 30 entries at $19.6bn.

  Regional repricing

  Four trends underpin the list’s 7.2% recovery. The conflict has repriced specific cohorts sharply higher – logistics up 44%, mining and fertilisers up 43%, the Yanbu refiners returning, and Aramco recovering to $181bn – with gains contingent on the Strait of Hormuz remaining closed.

  Regional banks have maintained last year’s momentum, with assets crossing trillion-unit thresholds and loan books supported by project activity. Six names have posted double-digit gains that are unlikely to reverse if conditions normalise.

  Saudi mid-tier stocks have corrected largely on valuation rather than operations, despite many reporting earnings growth through 2025, as confidence in gigaproject-driven growth has weakened. Property has also softened in the region as conflict has reduced routine and religious tourism.

  The 12-month outlook depends on whether Hormuz reopens, whether Saudi mid-tier valuations stabilise, and whether banking expansion holds under broader repricing.

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  John Bambridge
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  Gulf races to reroute trade

  1 June 2026

  

   

  The Strait of Hormuz has been the jugular vein of global energy markets for decades. A mere 33 kilometres (km) wide at its narrowest point, the maritime chokepoint has historically carried roughly one-sixth of the world’s oil consumption and one-third of its liquefied natural gas.

  With Iran effectively closing the strait in 2026, the Gulf has been forced into an accelerated search for alternative shipping routes – not only for oil exports leaving the region, but also for the imports of food, consumer goods and industrial inputs that keep Gulf economies running.

  Fujairah expansion

  The importance of alternative logistics routes was illustrated on 17 April, when UAE President Sheikh Mohamed Bin Zayed Al-Nahyan conducted a high-profile inspection of Fujairah port. During the tour, the leadership reviewed operations intended to ensure business continuity at the highest levels of efficiency and affirmed the port’s role as a key UAE asset supporting the international energy market. 

  Data released after a visit by the Minister of Energy and Infrastructure Suhail Mohamed Al-Mazrouei on 30 April underscored the scale of the shift. He said that since the spike in tensions, container handling had surged past 262,000 units at eastern ports. To sustain flows, about 4,800 trucks are operating daily, supported by a network monitoring 1,200 vessels within UAE waters.

  Fujairah port’s throughput has increased twentyfold, while daily truck movements have risen thirtyfold compared to pre-crisis levels. The storage footprint has expanded to over 7 million square metres. Crucially for regional partners, Fujairah has dedicated areas to handle more than 2.8 million metric tonnes of bulk cargo arriving from other GCC countries.

  The strategic importance of Fujairah was underlined on 4 May when Iran launched 12 ballistic missiles, three cruise missiles and four drones targeting the emirate, setting an oil facility ablaze and injuring three Indian nationals. 

  On the same day, an Adnoc- affiliated crude oil tanker was struck by drones while transiting the strait.

  The attack on the Fujairah Oil Industry Zone targeted a hub hosting major midstream players including Saudi Aramco, Vopak Horizon and Adnoc.

  Fujairah also serves as the terminus for the 300km Abu Dhabi Crude Oil Pipeline (ADCOP), linking the Habshan oil facility to the eastern seaboard and enabling the UAE to export a significant portion of Murban crude without entering the Gulf.

  Fujairah’s strategic importance will grow further. The West-East crude oil pipeline that Abu Dhabi National Oil Company (Adnoc) is building from Jebel Dhanna in Abu Dhabi to the emirate of Fujairah is set to be commissioned in 2027.

  Following a meeting of Adnoc Group’s board of directors on 15 May, the Abu Dhabi Media Office issued a statement saying that Sheikh Khaled Bin Mohamed Bin Zayed Al-Nahyan, Crown Prince of Abu Dhabi and Chairman of the Abu Dhabi Executive Council,  “directed Adnoc to accelerate delivery of the project, as the company moves forward into a new phase of world-scale project execution to meet global energy demand”.

  The cross-country project involves constructing a pipeline to transport crude from Adnoc’s main export terminal at Jebel Dhanna to the Fujairah terminal, a distance of about 520km. Once commissioned, it will double Adnoc’s crude export capacity through Fujairah on the Indian Ocean coast, enabling shipments to bypass the geopolitically sensitive Strait of Hormuz.

  The West-East crude oil pipeline will double Adnoc’s crude export capacity through Fujairah

  Import routes

  Diversifying export routes for crude is only one dimension of the post-Hormuz landscape.

  The broader GCC economy must also keep goods flowing in. Food, consumer goods, construction materials, medical supplies and spare parts are all vital to Gulf economies. To help maintain a steady stream of imports, a ‘Green Corridor’ was activated on 13 March between Dubai and Oman. It allows goods destined for the UAE to be offloaded at Omani seaports such as Sohar or Salalah and transported by land through the Hatta border.

  Retail and logistics players have tested unconventional routes as well. UAE supermarket chain Spinneys conducted a trial shipment of dry goods from the UK involving Mediterranean Sea crossings to Egypt and overland transit through Saudi Arabia, including the use of the Port of Neom on the Red Sea coast.

  Logistics hub

  On 20 May, Fujairah Terminals, part of AD Ports Group, announced the signing of three strategic land lease agreements with Fujairah International airport, Fujairah Free Zone Authority and Al-Dahra Agriculture Trading. The agreements aim to enhance connectivity and unlock new commercial opportunities across regional and international markets, while supporting the development of logistics and industrial capabilities and enabling more efficient use of port and adjacent infrastructure.

  The leased lands have a combined area of 130,000 square metres and will be used to enhance Fujairah Terminals’ logistics capabilities, reinforcing Fujairah’s role as a key gateway for regional and global trade and supporting the UAE’s position as a leading hub for logistics, maritime services and industrial growth.

  Saudi Arabia is also using its pipelines to bypass the Hormuz. Saudi Aramco’s East-West pipeline has reached its maximum capacity of 7 million barrels a day. Aramco president and CEO Amin Nasser recently said the company’s first-quarter performance reflected “strong resilience and operational flexibility in a complex geopolitical environment”, describing the pipeline as a “critical supply artery” that mitigated the impact of a global energy shock.

  For other Gulf countries the options are more limited. Shipping monitors have reported that Kuwait recorded zero crude exports in April – the first such occurrence since the 1991 Gulf War. Kuwait normally ships almost all of its 3 million barrels a day (b/d) of exports through Hormuz. Output reportedly fell to 500,000 b/d in March as storage reached capacity. With oil sales accounting for roughly 90% of government revenue, the effect on the Kuwaiti treasury has been severe. 

  Bahrain and Qatar have similar geographical challenges.

  The crisis has revived talk of multinational pipelines bypassing the strait. A working paper from Rice University’s Baker Institute for Public Policy proposes a Gulf Super Express Pipeline that would begin in southern Iraq’s Basra oil fields, cross Kuwait, run along the Saudi coast to pick up additional volumes, then cross the UAE and terminate on Oman’s Arabian Sea coast at Duqm and Salalah. The proposal envisages twin 56-inch lines with a combined capacity of 10 million b/d, and includes $10.1bn for defence and hardening. Total capital expenditure is estimated at $55.6bn. 

  Proponents argue the security premium could be $1-$2 a barrel to ensure that half the region’s exportable capacity remains accessible should the Strait of Hormuz be closed.

  These projects will create a steady workload for the construction industry in the years ahead

  Rail revival

  For other goods, rail is increasingly being promoted as the key to resilience. 

  The GCC has upcoming rail projects worth more than $140bn. An important project is the Hafeet Rail scheme, which is a 238km line connecting Oman’s port of Sohar to the UAE’s Etihad Rail network. As of April 2026, the project is 40% complete. Once operational, a single freight train would be able to transport 15,000 tonnes of cargo – equivalent to 270 standard containers – providing a high-capacity, land-based alternative to coastal shipping.

  Future projects linking GCC states are being accelerated too. On 7 May, Saudi Arabia Railways began the procurement process to deliver its portion of the GCC railway, which will connect all six member states. The kingdom’s section of the railway will start at Al-Khafji in the Eastern Province, near the border with Kuwait, and end at Al-Batha, at Saudi Arabia’s border with the UAE. The Saudi section will span approximately 672km and interface with the Kuwait National Rail Road project on the Kuwaiti side. 

  The wider GCC railway network will span 2,186km, beginning in Kuwait, passing through Dammam in Saudi Arabia, reaching Bahrain via a planned causeway, and continuing onwards to Qatar, the UAE and Oman through the Hafeet Rail link.

  These projects – encompassing pipelines, ports, railways and associated roads – will  create a steady workload for the region’s construction industry in the years ahead and, more importantly, will enhance the GCC’s economic resilience following the closure of the Strait of Hormuz. 

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  Colin Foreman
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  Contractor wins $163m Abu Dhabi pumping station deal

  1 June 2026

  

   

  Register for MEED’s 14-day trial access 

  Local firm Tamas Projects has won the main engineering, procurement and construction (EPC) contract for a $163m pumping station rehabilitation project in Abu Dhabi.

  The contract was awarded by Taqa Water Solutions for the restoration and rehabilitation of the Step Terminal Pumping Station PS01. 

  The pumping station is part of Abu Dhabi’s Strategic Tunnel Enhancement Programme (Step), a major wastewater infrastructure scheme developed by the former Abu Dhabi Sewerage Services Company, now part of Taqa Water Solutions.

  The project aims to extend the operational life of the facility, reduce unplanned outages and support the transmission of wastewater to downstream treatment and disposal facilities.

  According to MEED Projects data, Tamas completed a $30m pipeline replacement project for Taqa Transmission in 2024. The project involved the relocation of a 1.6-kilometre section of DN1000 pipeline serving the UAN and Unit 3 pumping stations.

  Construction on the pumping station rehabilitation project is expected to begin in the third quarter and be completed in 2028.

  The scope of work includes the replacement and refurbishment of mechanical equipment, the installation of disinfection systems and chemical dosing equipment, and upgrades to electrical, instrumentation and control systems.

  It also covers the installation of pipework, valves and pumping-station manifolds, as well as a ventilation and odour-control system.

  Meanwhile, Taqa Water Solutions has received bids for a separate water treatment plant upgrade project in Abu Dhabi.

  The project will upgrade the Al-Razeen water treatment plant to improve treatment capacity, water quality and operating reliability. A contract is expected to be awarded later this year.

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  Mark Dowdall