Energy, chemicals and utilities

We help clients generate strategies that work, develop distinct capabilities, and align investments for sustainable growth.

Since the mid-1990s, Strategy& Middle East has provided consulting services for energy clients in the Middle East. Our coverage extends across upstream, midstream, and downstream oil and gas, chemicals and petrochemicals, as well as power and utilities, including water and district cooling.

We help our clients to design and successfully implement growth strategies, to increase productivity, and to strengthen regulatory frameworks. We do this by deploying our expertise on strategy, operating model review, performance and margin cost improvements, privatization and public–private partnerships, regulatory frameworks, due diligence, research and development, shared services, and many other complex issues confronting businesses.

How we help our clients

Strategy& plays an active role in helping energy, chemicals and utilities clients in the Middle East set their long term strategies and tackle their most pressing challenges. We bring our clients an unparalleled understanding of the global and regional markets, thanks to a diverse team combining strategic experience, industry expertise, and knowledge of local specificities.

Our approach focuses on turning strategy into action and ensuring that our recommendations maximize value for our clients. Strategy&’s energy, chemicals and utilities practice provides consulting services for the following industries:

  • Oil and gas: Upstream and downstream industries, such as refining, transportation, shipping, storage, trading, and retail
  • Chemicals
  • Power: Electricity generation from conventional and renewable sources, transmission, and distribution
  • Water and wastewater: Production, transmission, distribution, sewerage, and wastewater treatment and reuse
  • Investments and infrastructure
  • Mining and process Industries: Production and processing of metals and minerals

The team helps clients in the following areas:

  • Integrated national energy strategies
  • Sectoral strategies and policies (e.g. local content, subsidy reforms, environmental)
  • Business strategy
  • Regulatory reforms and set-up
  • Operating model, organizational change and capability management
  • Productivity improvements and cost optimization
  • Privatization and public–private partnerships
  • Digitization agendas & roadmaps to address business issues
  • Environmental and sustainability strategies

Strategy&’s energy, chemicals and utilities practice has served almost every country in the Middle East.

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Client examples

Refreshing an energy strategy

After political turmoil had left its national energy infrastructure damaged or neglected, the government of a resource-rich Middle East country needed an integrated energy strategy that would optimize the linkages between upstream, midstream, and downstream oil and gas, power, and energy-intensive industries and provide the institutional and regulatory structures to enable the execution of the strategy. The client also wanted to understand the implications of the energy strategy on the socioeconomic and environmental conditions and ultimately, to crystallize a vision for the overall sector.

Following an extensive baseline of the domestic value chain, the team outlined a series of strategic pathways for the energy sector, covering crude commercialization, long-term refining, natural gas supply allocation and commercialization, the long-term energy-intensive industry, and power generation and fuel mix. Following that, an integrated national energy model was developed to evaluate and assess the implications of each strategic pathway on energy security, government value maximization, economic diversification, employment generation, and environmental sustenance. Accordingly, the optimum strategy was selected and detailed with the enabling of an institutional and regulatory setup for the subsectors, and the team detailed the implementation road map for the short, medium, and long term. Strategy& helped the country make sense of its vast, but damaged, oil and gas sector and the strategy required to lead it back to sustained growth.

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Rebuilding refinery margins

When a joint venture refinery started experiencing significant financial losses, management called on Strategy& to help determine the cause, and advise on a margin improvement plan.

The Strategy& team first created a baseline of the refinery’s units, processes, product flows, and production. In parallel, they reviewed historical financial statements and worked closely with management and the refinery’s optimization unit to diagnose the decision making process related to feedstock sourcing, refinery utilization, products’ mix, and constraints put in place. They then designed a customized margin-tracking tool, and ran it on historical data to identify the sources of margin leakages. Accordingly, the team has put forward a margin improvement plan that is centered on a revised market optimization algorithm, a dynamic decision making process, and more capable decision support team.

Strategy& was able to pinpoint the areas responsible for margin leakage and assist management in taking the operational decisions to turn around the situation.

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Selecting petrochemicals growth targets

A large GCC petrochemical company was struggling to identify and pursue growth opportunities, both close to home and further afield in the MENA region. Strategy& was asked to design a strategy and a governance model for the client’s M&A processes, and to find attractive greenfield and M&A candidates suitable to the client’s aspirations.

To develop the growth strategy, M&A approach, and governance model, the Strategy& team first defined and helped establish the requisite capabilities: process, governance, tools, systems, and talent. The team then generated a list of M&A targets and greenfield opportunities that aligned with the growth strategy and evaluated the most promising, ascertaining the synergies. The client approved the top 10 “build” and “buy” targets and gave the team the green light to design deal structures, engage in discussions and negotiations with each selected partner, and conduct due diligence on the targets.

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Putting renewables in the power mix

A GCC country’s ministry of energy set the ambitious goal of deploying diverse renewable technologies over the next decade. Strategy& was drafted to help in auctioning the ambitions and to support in realizing them. The team began with articulating the program’s vision, defining the optimal renewable technology mix and capacity deployment plan, setting up the tendering policy framework, and establishing a centralized capacity procurement entity.

For the launch of the program itself, the team took care of obtaining approvals, supported the efforts to socialize it, and within nine months instigated an initial tendering round to procure renewable capacity. The result was that bids were among the lowest internationally for renewables projects. Strategy& also designed and implemented a series of programs to ensure that the renewables strategy built local content and capabilities across the value chain in a manner that is competitive with comparable foreign suppliers.

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Holistic review of national oil company upstream performance

Strategy& was retained by one of the world’s largest national oil companies to help identify performance improvement opportunities across the spectrum of upstream operations.

The Strategy& team conducted an in-depth review of exploration, well delivery, reservoir management, major projects, procurement, and human resource processes, with reference to industry-leading practices, and identified the root causes for performance shortfalls. The team developed charters and improvement plans for individual functions, and introduced major cross-cutting initiatives to strengthen the culture of collaboration in the company. Leadership alignment sessions led by the team brought unity of vision on the areas to be improved and consensus on the road map.

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Downstream international growth strategy for a national oil company

Strategy& was retained by a leading international downstream subsidiary of a major Middle East national oil company to validate the existing long-term strategic plan, with key strategic directions cascaded to the different operating units, supported by concrete road maps for the operating units to pursue.

The Strategy& team conducted a rapid validation of the countries and plays identified in the long-term plan on agreed macro and market dimensions. The team identified business opportunity "themes" (countries/regions), and created a list of potential opportunities across the validated countries/plays. They then prioritized the opportunities and defined entry options (JVs, M&A, or organic), which included not only key implications for the company’s operating model, capabilities, and resources, but also the risks. Finally, the team facilitated leadership alignment and approval on the implementation road map to ensure key stakeholders in the client organization have clarity and a unified vision on the way forward.

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Latest media clip

Dr. Shihab Elborai on electricity pricing reform in GCC industries

Dubai One interviews Dr. Shihab Elborai, Partner with Strategy& Middle East, to discuss the firm’s study entitled "Electricity pricing reform: A bitter pill for GCC industries".

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George Sarraf

Managing Director, Strategy& Middle East

Georges Chehade

Partner, Strategy& Middle East

Dr. Raed Kombargi

Partner, Strategy& Middle East

Joe Saddi

Senior Executive Advisor, Strategy& Middle East

James Thomas

Partner, Strategy& Middle East

Nadim Noujaim

Partner, Strategy& Middle East

Frederic Ozeir

Partner, Strategy& Middle East

Dr. Shihab Elborai

Partner, Strategy& Middle East

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