Vince Cook

'Oman led the way and then Qatar followed with its gas projects,' notes Vince Cook, Gulf managing director for Barclays, which is the leading international bank in this field. 'Now people seem to have fully appreciated the benefits of project finance and the importance of foreign direct investment to the region.

'In the UAE we have taken a leading role in Abu Dhabi's three independent water and projects, and we are now waiting to decide which bidding group to support for the fourth IWPP. There has been a change in attitudes to foreign direct investment in the region with a general movement to relax 100% ownership levels'.

This has given British banking giant Barclays the opportunity to build on its presence in the Gulf, and from its Dubai office Barclays hopes to expand its role further in the near future.

'We still see lots of potential project finance opportunities in Qatar with the expansion of RasGas and Qatar Gas, particularly among the five proposals for gas-to-liquids projects,' says Mr. Cook. 'In Bahrain we hope to become involved in Bahrain Aluminium's expansion project, and lever our position as a dealer on the London Metals Exchange to advantage.

'As ALBA sees a market opportunity to expand so must Dubal, and we would be very interested in anything they might be considering in the future. The Dubai Electricity and Water Authority could also follow Abu Dhabi with IWPPs, and so release government money for other projects. But actually there is very little project finance activity in Dubai at the moment. Most of the funding in Dubai comes from the government and private groups'.

However, Saudi Arabia could be the next El Dorado for project finance, and Mr. Cook is keeping a close eye on the $25 billion Saudi Gas Initiative and its three core projects. There are also big opportunities to fund the development of power stations and water infrastructure in the Kingdom as well as mineral extraction.

'I don't think Saudi Arabia is really moving slowly when you consider the scale of these projects in relation to the economy as a whole,' he adds. 'The Arab habit of obtaining a consensus for such major decisions is actually an advantage as it means that issues are properly considered and that decisions are not made the spur of the moment. But the pressures on the Saudi government are so great that they will have to do something'.

However, other major project finance deals are coming up shortly. Within the next three to six months Mr. Cook expects the $3.5 billion Dolphin project to develop the Qatar North Field and bring gas to the UAE through a new pipeline to announce details of its funding.

Meanwhile, there is financing for the Oman Refining Company and a fertilizer plant in Oman, as well as two major plants in Kuwait.

Indeed, the whole project finance scene is now transformed in the Gulf region, and Barclays hopes its first mover advantage will continue to help win new business. 'It really does help here if you can go back to people that you have already worked with,' says Mr. Cook, who has live in Dubai for the past three years and has spent the past 15 years associated with the Middle East.