Putting socio-economics at the heart of today’s energy firms

Hesham Ali Mustafa /
Special To Emirates Business

Energy plays an integral role in every economy and in communities around the world. Therefore, socio-economic impact is often at the heart of the investment strategies of national oil companies (NOCs). It’s evident that the UAE and the Gulf have emerged as global energy hubs, but the region is still at the beginning of its journey.
Benefiting the local community and economy, whether through providing job opportunities or investing in key infrastructure, is no longer a sideline activity that represents a tick in the box; it must be a core mandate.
Today’s lower oil prices must not curb NOCs’ appetite to deepen their socio-economic initiatives, which include creating sustainable employment for the local population. NOCs should also focus their investments on relevant research and development (R&D) and establish corporate social responsibility (CSR) programmes that can enhance social livelihoods and human capital to enhance environmental, educational or health awareness.
Quantifying socio-economic impact is not a straight-forward task but it can be partly achieved by gauging customer and employee satisfaction. For example, ENOC’s Employee Engagement Index has improved by 11% since 2009, climbing from 3.88 to 4.41 on a scale of one to five. Employees’ satisfaction is a key obligation and it has clear economic benefits. We’ve all witnessed the progressive strides the UAE has been making on that front with the recent appointment of a Minister of State for Happiness. On another hand, the number of our customers that are ‘Truly Loyal’ is at 79% – considerably higher than global standards for most businesses around the world. While such statistics do not provide the whole story behind ENOC’s efforts, they are useful indicators for all NOCs. The integral importance of NOCs in the economic and social mix in the Gulf and beyond will only deepen, as the global population is set to jump from 7 billion today to 9.6 billion by 2050. As a result, the world’s energy demand will climb alongside the swelling population.
As a key partner in helping Dubai meet its growing demand, we are boosting our Jebel Ali refining capacity from 140,000 barrels a day to 210,000 barrels a day, supporting their strategic growth objectives, as well as building a 19km extension of Falcon jet fuel pipeline to Al Maktoum International Airport. This follows the completion of our 58km jet fuel pipeline that links the storage terminal in Jebel Ali with Dubai International Airport (DXB).
Each of our energy projects is designed to satisfy Dubai’s rising energy appetite as the emirate deepens its position as a global hub, while creating training and employment opportunities to enhance Dubai’s human capital. Looking ahead, NOCs will only become more integrated into countries’ social and economic fabric. If you are an NOC, are such goals a significant part of your mandate and if so, can they be developed further? Those who answer ‘yes’ represent the leading energy players of tomorrow. There are many energy projects for NOCs to explore and many more lives to enhance.

Hesham Ali Mustafa is the Executive Director – Head Of Group Strategy & New Business Development at Emirates National Oil Company (ENOC)