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Kuwait, Saudi Arabia and Yemen all have their differences by A happy ThingLink User

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Saudi Arabia and Water Scarcity Presentation

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Connection between water, oil and human interaction. 

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Connection between water, oil and human interaction. 

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KHOBAR/LONDON (Reuters) - Long before it understood the value of oil, the desert kingdom of Saudi Arabia knew the worth of water.

But the leading oil exporter's water challenges are growing as energy-intensive desalination erodes oil revenues while peak water looms more ominously than peak oil -- the theory that supplies are at or near their limit, with nowhere to go but down.

Water use in the desert kingdom is already almost double the per capita global average and increasing at an ever faster rate with the rapid expansion of Saudi Arabia's population and industrial development.

Riyadh in 2008 abandoned what was in retrospect clearly a flawed plan to achieve self-sufficiency in wheat and aims to be 100 percent reliant on imports by 2016.

"The decision to import is to preserve water," said Saudi Deputy Minister of Agriculture for Research and Development Abdullah al-Obaid. "It's not a matter of cost. The government buys wheat at prices higher than in the local market."

Critics complain the policies are still not joined up, however, and say the risk is that Saudi farmers will turn to even thirstier cash crops.

"Many farmers who used to grow wheat start growing fodder (animal feed) instead that generates quick cash. But unfortunately fodder's use of water is four times more than for wheat," said Abdulaziz Rabih al-Harbi, professor at the King Saud University and a member of the agriculture committee at the Riyadh Chamber of Commerce and Industry.

"Other farmers grow palms instead of wheat and this also consumes huge amounts of water and may not achieve the desired goal of efficient water consumption."

As one of the kingdom's primary sources of development and employment, agriculture is a sensitive political issue and so scaling back is not an option.

But with such a small amount of the country suitable for cultivation, a comprehensive solution is required, industry officials say.

A water quota for the agriculture sector and a push to reduce wheat consumption, which is rising by 5 percent a year, are possible solutions, said Hasan al-Shehri, chairman of the Cooperative Association of Wheat in the Kingdom and general manager at the Saudi Agricultural Development Co.

"We need coordination between the ministries of agriculture and water," said al-Shehri.

The lack of water also poses a major challenge to the kingdom's hopes to develop its mining sector to diversify its economy given the water-intensive nature of the industry.

"Gold is there but we don't have water," Mohammed Hany al-Dabbagh, vice president of precious metals and exploration at state-controlled minerals firm Saudi Arabian Mining Co said.

"Water is as precious as gold."

PEAK WATER

Saudi Minister of Water and Power Abdullah al-Hussayen said in May the nation's demand for water is rising by more than 7 percent each year and that more than 500 billion riyals ($133 billion) of investment in the water and power sector will be required over the next decade.

Consultancy Booz and Company estimates Saudi water use is around 950 cubic meters per capita each year, compared with a world average of 500 cubic meters.

Agriculture is the single biggest user, absorbing 85-90 percent of the kingdom's supplies, according to Saudi's deputy minister of agriculture for research and development. Of that, almost 80-85 percent came from underground aquifers.

With average annual rainfall around 100 mm (4 inches), Saudi's ancient underground aquifers are its lifeblood.

But just as peak oil theorists believe the world's conventional oil supplies are at or near their peak, proponents of the peak water view have said the resource has been irreversibly drained.

Booz and Company has said some of the region's aquifers -- also referred to as "fossil water" as they contain rain that fell thousands of years ago -- have become too salty to drink.

Injecting water into oilfields has also had an impact, although sea water is now generally used to maintain reservoir pressure.

HIGH COST, HIGH ENERGY

The alternative to desalination -- the energy-intensive process of converting salt water to fresh water -- robs Saudi Arabia of its other precious resource, oil, by eating up both fuel and fuel revenues.

Saudi Arabia's Saline Water Conversion Corp (SWCC) produces 3.36 million cubic meters of desalinated water per day, a daily cost of 8.6 million riyals based on the SWCC's 2009 figures -- the latest available -- when the cost of producing one cubic meter of desalinated water was 2.57 riyals. Transporting it added an extra 1.12 riyals per cubic meter.

Analysts and industry leaders say the authorities need to pass on more of the costs to the end-user to curb demand and reduce waste -- an argument that holds true for power and fuel but which requires very careful handling in the case of water.

"It is necessary to raise water tariffs," Isao Takekoh, a director at the U.S.-based International Desalination Association, said. "But it should be conducted very carefully and step-by-step because water is, needless to say, indispensable for human life."

By burning up energy, desalination reduces the amount of crude available for lucrative export markets. Takekoh estimated energy represented between 45 and 55 percent of unit production costs.

The International Energy Agency and analysts at HSBC bank estimated Saudi Arabia's rate of direct crude burning more than doubled from 2008 to 2010 because of a rapid rise in power demand and a shortage of natural gas. How much of that went to desalination is not known but experts believe it is significant.

Industry officials and experts say the fact that Saudi Arabia is adjusting its agriculture policies shows it is aware of the challenges but like the rest of the world, it needs to move fast.

"Saudi Arabia realized they should start thinking about using their water in a more efficient way," said Peter Brabeck, chairman of Nestle, one of the world's largest food companies and a leading campaigner to avert a world water crisis.

"They understand water has more value than oil in the long term," he said.

Editing by Daniel Fineren and Sonya Hepinstall

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Saudi Arabia's water needs eating into oil wealth

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KHOBAR/LONDON (Reuters) - Long before it understood the value of oil, the desert kingdom of Saudi Arabia knew the worth of water. But the leading oil exporter's water challenges are growing as energy-intensive desalination erodes oil revenues while peak water looms more ominously than peak oil -- the theory that supplies are at or near their limit, with nowhere to go but down.

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What role have natural resources played in politics and economy of the Middle East?

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What role have natural resources played in politics and economy of the Middle East?

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DOD, Defense Visual Information Center, March Air Force Base, CA

The Middle East has always had a rich abundance of natural resources, although which resources are coveted and valued has changed over time. Today, abundant petroleum fields dominate the area's economy. The Middle East is similarly disproportionately rich in natural gas (32 percent of the world's known natural gas reserves are in the region) and phosphate (Morocco alone has more than half of the world's reserves).

Water has always been an important resource in the Middle East -- for its relative scarcity rather than its abundance. Disputes over rights to water (for example, building a dam in one country upstream from another) are a fundamental part of the political relationships in the region. Water for irrigation is necessary for many of the ecosystems to sustain crops.

In the 18th and 19th centuries, major European nations competed to establish and maintain colonies around the world. Superior military power and economic leverage allowed them to create new markets for their manufactured goods, and to exploit the natural resources of the African, American, and Asian continents.

Since the early part of the 19th century, Europeans vied to control the Middle East. The Sykes-Picot Agreement of 1916 divided the Ottoman lands between the British and the French, giving those nations control over any natural resources, most importantly oil.

Modern armies were thirsty for oil. The British navy was the first to switch from coal to oil in 1912, and other new technologies, like automobiles and airplanes, quickly and drastically increased the demand for fuel.

The United States was becoming an important player in world affairs during the early 20th century, and soon Americans found they, too, had a vested interest in developing and controlling oil reserves in the Middle East to supply their growing needs.

More than 1,000 years ago, Zoroastrians in Iran revered the perpetual flames that burned where natural gas vented from the earth. In the early 20th century, British prospectors discovered oil in Iran and in 1908 began the first large-scale drilling projects there. The government of Iran sold the exclusive right to explore and drill for oil in Iran -- a " concession" -- to the Anglo-Iranian Oil Company (AIOC). The British government bought a controlling stake in AIOC, and by the start of World War I, Iranian oil was Britain's most important strategic resource.

In time, Iranians grew to resent the AIOC. The terms of the concession were so unbalanced that British investors were rewarded handsomely while the government of Iran made very little profit. Foreign businessmen and engineers in Iran led extravagantly wealthy lifestyles that contrasted sharply with the poverty of the local population.

Frustration with foreign exploitation led to nationalization. The Iranian government of Mohammed Mossadeq nationalized the Anglo-Iranian Oil Company in 1953, but in a coup engineered by the American Central Intelligence Agency (CIA), this nationalist government was overthrown, and a government friendly to Western interests was installed under the control of the Shah of Iran.

The continued economic and cultural influence of the West and the repressive nature of the Shah's regime led to the Iranian Revolution of 1979. The Shah was overthrown and exiled, and the new Islamic Republic of Iran was established, led by the Ayatollah Ruhollah Khomeini.

After World War II, Britain and France gave up control over much of the Middle East, as they could no longer afford to continue their imperialist strategies, either politically or economically. But a new world power, the United States, increased its presence in the region as American demands for oil were rapidly growing and outstripping domestic supply.

Standard Oil of California first discovered oil in Saudi Arabia in 1936. The huge deposits there and in the neighboring Persian Gulf countries -- the United Arab Emirates, Kuwait, and Bahrain -- established these countries as some of the richest in the world.

Continuing American military power and domestic lifestyles depend on available access to Middle Eastern oil and reasonably low world petroleum prices. Thus, U.S. foreign policy initiatives work to support the stability of pro-U.S. governments, prevent anti-U.S. powers or blocs from forming, and reduce tension and potential armed conflict in the region.

Relations between the Saudi and U.S. governments have traditionally remained strong. Some Americans have questioned that relationship since the events of September 11, 2001, when Osama bin Laden and several other Saudis were involved in the attacks on the World Trade Center and the Pentagon. At the same time, many Saudis mistrust their government's close relationship with the U.S. and resent other American policies in the region, such as U.S. support for Israel and the U.S.-led bombing of Iraq. The presence of armed U.S. troops in Saudi Arabia -- the birthplace of Islam -- is particularly galling to many Muslims.

Because the Middle East has the world's largest deposits of oil (55 percent of the world's reserves) in an easily extracted form, Middle Eastern oil continues to be necessary to the United States. American dependence on foreign oil has grown steadily over the years; currently about 55 percent of the oil consumed in the U.S. is imported. This reliance on foreign oil leaves the country vulnerable to unilateral political and economic acts by oil producing countries. For example, although the U.S. advocated economic sanctions against Iraq after the Gulf War, 9 percent of the oil used by Americans after the war still came from Iraq, shipped through other countries.

Oil money has created both opportunities and problems for the region.

Middle Eastern nations have learned to manipulate their production of oil as an international strategy. After the unsuccessful Yom Kippur War with Israel in 1973, an OPEC oil embargo by Arab nations demonstrated a new way to influence European and American policy. Oil prices quadrupled from $3 a barrel in 1972 to $12 a barrel in 1974. In the U.S., the era of cheap gas came to an end, stimulating research on increasing energy efficiency, conservation, and alternative fuels as well as exploration for alternative sources of oil.

Uneven distribution of petroleum deposits has created a disparity of wealth and power in the Middle East. Gulf countries with relatively small populations have the most oil. When workers from countries with large, poor populations, such as Egypt, come to the Gulf region to work, they are often treated as second-class citizens. Meanwhile, wealthy Saudis and Kuwaitis may vacation in Egypt, openly drinking alcohol and displaying other behaviors that would not be permitted in their home countries. Even within oil-rich nations themselves, there is a large gap between rich and poor.

Oil will continue to be an important regional and global issue. In fact, some question whether one reason the U.S. seeks to maintain influence in Afghanistan after the overthrow of the Taliban is American interest in Central Asian oil and a possible pipeline through Afghanistan. Some estimates show that by 2050, landlocked Central Asia will provide more than 80 percent of the oil distributed to the U.S. As a result, the control of pipelines through Afghanistan or Turkey to distribution centers will be of increasing importance to the United States.

Another resource of vital importance to the region is water. Egypt, Iran, and Turkey are the only countries in the region with abundant fresh water resources. Roughly two-thirds of the Arab world depend on sources outside their borders for their water supply.

The scarcity of water is a major cause of tension between states in the region. Former U.N. Secretary General Boutros Boutros-Ghali has said that the next war in the Middle East will be fought over water.

The Jordan River provides 75 percent of Jordan's water and 60 percent of Israel's. In the early 1960s, Arab nations worked to divert the headwaters of the Jordan away from Israel and towards Jordan. One of Israel's objectives in the Arab-Israeli Six Day War of 1967, among others, was to control the Golan Heights and prevent this plan from being carried out. Israel is still reluctant to restore control of the Golan Heights to Syria. Though often ignored in Western analyses, water is one of the most contentious issues in the discussion of any peace plan for the Jordan Valley.

The Euphrates River, which originates in Turkey, provides most of the water for eastern Syria and almost all of Iraq. Turkey plans to build almost two dozen hydroelectric power dams for its growing population and industries. These dams, joining the completed Atatürk Dam, would drastically reduce the water available to Syria and Iraq. Syria, in turn, has dammed part of the Euphrates under its control, further choking off the water supply to Iraq. International complaints and protests are often challenged on the grounds that the dams are domestic infrastructure projects.

While most Americans may think of the Middle East as primarily desert, agriculture has been important for millennia, with farmers adapting to environmental conditions in different locations.

The history of cotton in Egypt is a good example of how Europeans have exploited the region's agricultural resources. During the American Civil War, American cotton grew scarce, and Egyptian cotton became increasingly important to England. Agreements signed in 1880 with European powers meant that no tariffs were applied to cotton. This meant that more and more farmable land was used to grow cotton instead of food crops. Most of the profits were taken by Egypt's small ruling elite and the Europeans. This system remained in place until the Egyptian Revolution of 1952, when the era of state-sponsored industrialization and a movement toward self-sufficiency began, reducing the amount of cash crops, like cotton, that were exported.

Middle Eastern cotton and textile products, however, are still an important export of the region. More and more garments in American malls, for example, carry a "Made in Turkey" label. Other important agricultural exports found in supermarkets around the world include citrus, dried dates, figs and apricots, and olive products.

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Related sites

Oil Prices on the Rise:
http://www.pbs.org/newshour/bb/middle_east /july-dec99/oil_11-23.html
NewsHour discusses Iraqi leader Saddam Hussein's decision to cut off his country's oil exports to push up prices around the world.

Afghanistan's Agony:
http://www.pbs.org/newshour/bb/asia/jan- june01/afghanistan_3-29.html
NewsHour reports on the devastating drought and political turmoil in Afghanistan. (March 2001)

Oil Price History and Analysis:
http://www.wtrg.com/prices.htm
A discussion of crude oil prices, the relationship between prices and rig count, and the outlook for the future of the petroleum industry.

Is America Stuck in the Middle East?:
http://www.pbs.org/thinktank/show_978.html
Is Middle East oil still crucial to American security?

Global Issues - Middle East:
http://www.globalissues.org/Geopolitics/MiddleEast.asp
Modern Middle Eastern geopolitics have always been about oil. Given the vast energy resources that form the backbone of Western economies, the Middle East has been of paramount importance.

Energy Matters - The Mideast Oil Crisis:
http://library.thinkquest.org/20331/history/mideast.html
A brief history of the Mideast oil crisis in the 1970s and reasons for the embargo

Water Diplomacy in the Middle East:
http://www.netcomuk.co.uk/~jpap/dolat.htm
This site explains how access to water is a key environmental factor in the politics of the Middle East.

People, Land and Water:
http://www.idrc.ca/research/xplaw_e.html
Articles and research dedicated to land and water issues in the Middle East and Africa

Water in the Middle East:
http://www.columbia.edu/cu/lweb/indiv/mideast /cuvlm/water.html
A list of links from Columbia University's Middle East and Jewish Studies Department related to water issues in the Middle East

Commanding Heights Web Site:
http://www.pbs.org/wgbh/commandingheights/
An economist's look at world history and development from 1910 to the present

Middle East: Crossroads of Faith and Conflict (map):

Supplement to National Geographic, October 2002

Economics: It's More Than Oil

What have been the role and effects of U.S. foreign policies and actions in the Middle East?

Middle East Topographic and Natural Resources

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Global Connections . Natural Resources | PBS

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DOD, Defense Visual Information Center, March Air Force Base, CA The Middle East has always had a rich abundance of natural resources, although which resources are coveted and valued has changed over time. Today, abundant petroleum fields dominate the area's economy.

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Why is water important?

Think about how you use water daily to support your answer.

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Google Slides

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renewable
nonrenewable
abundance
scarcity
natural resources
dependence
region
tarif
supply
demand
desalination