Silicone Oil in the Emirates- UAE's Industrial Development & Silicone Oil

Cited from: https://pixabay.com/zh/photos/burj-khalifa-emirates-dubai-uae-2212978/

Cover photo cited from: https://pixabay.com/zh/photos/travel-tourism-abu-dhabi-mosque-4604499/

The United Arab Emirates is located at the southeast end of the Arabian Peninsula, the sea transportation hub from the Gulf to the Indian Ocean, and is rich in oil and gas resources. The Proven reserves of oil are 107 billion barrels, and the Proven reserves of natural gas are 7.73 trillion cubic meters, ranking sixth in the world. The Petroleum industry is the pillar industry of the United Arab Emirates. The huge and stable oil revenue is the main source of the fiscal revenue of the United Arab Emirates, making it the second largest economy in the Gulf region and one of the richest countries in the world. At the same time, in order to reduce dependence on the Petroleum industry, reduce the impact of oil price fluctuations on economic growth, and achieve sustainable development, the UAE is committed to pursuing economic diversification policies, encouraging innovative development, and has gradually developed into a financial, trade, logistics, exhibition, tourism center and commodity distribution center in the Middle East.

The whole territory of the United Arab Emirates is crescent shaped. There are no fresh water rivers or lakes in the territory. The coastal area is a low lying plain. The northeast part of the peninsula is mountainous. The highest peak of the Hajar Mountains across the peninsula is 2438 meters above sea level. In addition, the vast majority of the United Arab Emirates consists of deserts and depressions with an altitude of over 200 meters. The desert accounts for 65% of the total area of the United Arab Emirates, with some oases, the largest being the Bulaimi Oasis in the Ain region, which is also the main agricultural area of the UAE.

According to World Bank data, as of the end of 2019, the population of the United Arab Emirates was 9.77 million, with 6.767 million males and 3.003 million females, accounting for 69.3% and 30.7% respectively. According to official statistics from the United Arab Emirates, the domestic labor force in 2018 was approximately 7.38 million, accounting for 76.7% of the total population. The population of the UAE is mainly distributed in emirates such as Dubai, Abu Dhabi, and Sharjah. The domestic population accounts for 11.48% of the total population; The foreign population accounts for 88.52%, mainly from India, Pakistan, Bangladesh, the Philippines, Iran, Egypt, etc. There are nearly 300000 local Chinese residents, mainly concentrated in emirates such as Dubai and Abu Dhabi.

With the steady economic growth, increase in national income, and population growth in recent years, the final consumption expenditure of UAE society has also been increasing year by year. According to World Bank data, in 2019, the total final consumption expenditure of the United Arab Emirates was approximately $219.8 billion, accounting for 52.2% of domestic GDP, of which the final consumption expenditure of residents was approximately $164.43 billion.

Industries in the UAE and Silicone Oil Applications

1.      Petroleum industry.

Oil production plays a very important role in the UAE economy. Oil production in the United Arab Emirates is mainly in Emirate of Abu Dhabi. Abu Dhabi's oil industry is in a mature stage, and based on current production and reserves, it can still produce for over 120 years. The oil industry of the Emirate of Dubai is in a period of exhaustion with limited reserves. According to the current production and reserves, it can be exploited for 20 years at most. Other emirates are in the stage of development, exploration, and oil exploration. In 2018, the oil production of the United Arab Emirates was about 3.5 million barrels per day. Abu Dhabi National Oil Company (ADNOC) plans to increase its oil production capacity to 5 million barrels per day by 2030. In 2019, limited by the OPEC+production reduction agreement, Afghanistan's oil production was approximately 2.6 million barrels per day. Although the United Arab Emirates has a huge amount of natural gas, most of it is used for reinjection and oil extraction due to the high domestic demand for natural gas. At the same time, it is mostly acidic gas fields, which are difficult to extract and costly. Currently, it still highly relies on natural gas imports and imports natural gas from Qatar through the Dolphin Project. To meet the growing demand for natural gas, ADNOC has invested $20 billion to launch a high acidity gas field development project in western Abu Dhabi. Silicone oil is mainly used as the protection agent of this industry.

2.      Non Petroleum industry.

At present, the United Arab Emirates is trying to promote the development of petrochemical metallurgy, processing and manufacturing, new energy, finance, tourism and other industries. The proportion of non Petroleum industry in economic growth is increasing, and its position as a regional trade, finance and logistics hub is further strengthened. In 2019, the non Petroleum industry of the UAE accounted for about 70% of GDP. Silicone oil is widely used in this industry for transportation and storage.

3.      Aluminium smelting industry.

Aluminium smelting industry is one of the major non Petroleum industry in the United Arab Emirates. In June 2013, the two major aluminum giants in the United Arab Emirates, Dubai Aluminum (DUBAL) and Emirates Global Aluminum (EMAL), announced the merger and establishment of Emirates Global Aluminum. In 2019, the company had a production capacity of 2.6 million tons, ranking seventh in the world. In 2018, the aluminum industry contributed $20 billion to the UAE economy, accounting for 1.4% of domestic GDP and providing 60950 job opportunities. Silicone oil could be used in the metal processing procedures.

4.      The real estate and construction industry.

It plays an important role in the UAE economy, with Dubai's real estate industry contributing 7.2% to the UAE economy in 2019. Since 2020, due to the impact of the COVID-19, and the sharp increase in market supply, which led to oversupply, house prices and housing rents in the United Arab Emirates have shown a downward trend, and are expected to recover by 2022.

5.      The cement industry.

It is the oldest production industry in the United Arab Emirates. There are a total of 20 cement factories in the United Arab Emirates, and the first cement producer in the UAE, Union Cement Company, was established in 1972. Since the introduction of its first production line in 1975, the company has rapidly developed and become the largest cement producer in the UAE. With its excellent geographical location close to Sarkel Port, the products have been sold to the Middle East and East Africa.