UAE's Fujairah looking to boost oil reserves

(MENAFN) Fujairah, a northern UAE emirate, is undergoing exploration drillings for onshore and offshore oil deposits, Bloomberg reported. The emirate has so far carried out three drills that have so far been unsuccessful, Salem Kelil, technical adviser to Fujairah government revealed. The emirate seeks to increase its energy output. In March, Abu Dhabi unveiled plans to build a terminal in Fujairah for importing liquefied natural gas (LNG), to bypass the Strait of Hormuz, which has recently been threatened with closure by Iran. Fujairah's coastline is on the Gulf of Oman, which empties into the Indian Ocean. Gulf oil producers such as Saudi Arabia and the UAE want additional gas supplies to make electricity and petrochemicals and fuel for heavy-energy-consumer industries such as smelters. This is good news for the port of Fujairah, which depends on Iran for nearly a third of the 1 million metric tonnes of fuel oil it buys and sells each month, as analysts say it will face higher costs as sanctions against Iran curb supplies of fuel oil for the Middle East's biggest ship-refuelling centre. Refuelling costs at Fujairah may grow as traders there must find alternative sources of low-sulfur fuel from Iran, and meet the International Maritime Organisation standards that global sulfur emissions not exceed 3.5 percent.