Energy
From The Report: Brunei Darussalam 2016
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A powerhouse regional oil and gas producer, Brunei Darussalam has benefited significantly from a long history of hydrocarbons production in partnership with international oil companies. The energy sector continues to dominate the economy today, accounting for the majority of government revenues, GDP and exports. However, the sector is facing a host of concurrent challenges – production at Brunei Darussalam’s mature fields has been in decline for a decade, while oil and gas prices have fallen rapidly since mid-2014 – putting a significant strain on expenditure, investment and economic growth. Although the near-term forecast for energy sector growth is subdued, there have been a number of positive developments in recent years that will support long-term expansion.

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Overview

Plan of action: A changing marketplace has led to a host of initiatives spearheaded by both the government and the private sector
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A powerhouse regional oil and gas producer, Brunei Darussalam has benefitted significantly from a long history of production in partnership with international oil companies. Hydrocarbons continue to dominate its economy today, accounting for the majority of government revenues, GDP and exports. The sector is facing a host of concurrent challenges – production at Brunei Darussalam’s mature fields has been in decline for a decade, while oil and gas prices have declined rapidly since mid-2014 –…

Analysis

A natural leader: Partnerships with major international oil companies have helped the country cope with a fall in natural gas prices
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Brunei Darussalam was a pioneer in the liquefied natural gas (LNG) sector during the 1970s, building a large-scale liquefaction plant and developing long-standing export ties to key markets in Japan and South Korea, leading to robust industry expansion and a substantial augmentation of its petroleum revenue base. However, both production and export of LNG has fallen in recent years, as ongoing maintenance at key production bases, an increasingly competitive export market, rising domestic demand and…

Analysis

Neighbourly relations: By working with its ASEAN partners the Sultanate is identifying new avenues for growth and collaboration
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In a bid to diversify its economy, bolster future earnings from oil and gas revenues, and support ASEAN integration, Brunei Darussalam has joined a number of regional initiatives in recent years, with the goal of reducing consumption and increasing the use of renewable energy over the next decade. Regional cooperation in renewables development is becoming increasingly common for Brunei Darussalam’s leadership, and the Sultanate has moved to the forefront of renewables research, after partnering…

Analysis

Waste not, want not: Energy subsidies have long been a staple, but the government is encouraging its citizens to reduce consumption
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Although nearly all residents of Brunei Darussalam are connected to the electricity grid and benefit from a well-developed, reliable and low-priced utilities system, electricity consumption per capita in the Sultanate is among the highest in the world, while difficulties in accessing new power supply have hindered expansion of some industrial enterprises in recent years. Residential consumers continue to account for the majority of consumption in the Sultanate, even though prices were changed from…

Analysis

Embracing renewables: Confronting the reality of climate change has become a priority for the Sultanate
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Although its dominant oil and gas sector will likely remain at the forefront of economic growth over the medium term, Brunei Darussalam has prioritised sector diversification and development of renewable energy projects in recent years, as highlighted by the 2014 “Energy White Paper”, as well as a climate change plan released prior to the COP21 UN Conference on Climate Change, hosted in Paris in late 2015. These policies outline an ambitious long-term renewables development strategy emphasising…