Liwa Chemicals: Untied Arab Emirates

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Table of Contents

Abstract
Liwa Chemicals
Literature Review
Recommendations
Conclusion
References

Abstract

The United Arab Emirates has a significant potential of enabling investors to generate high returns on their investments if they plan their work properly. Even though, this region is predominantly an oil exploration and drilling zone other businesses have been established here to facilitate these activities. Liwa Chemicals is one of these companies that have enabled domestic and foreign workers to access oil exploration and equipment supply services in Abu Dhabi. This discussion will outline a brief history about this company, how it has managed to remain relevant despite stiff competition from other companies and present recommendations to improve its practices.

Liwa Chemicals

Introduction

Liwa Chemicals is one of the new entrants in the oil drilling industry and this means that it faces stiff competition from old companies. It is important to explain that this company was established to offer oil exploration and drilling services but it later expanded its operations to include supplying materials and equipment for other oil companies. However, things have not been easy especially due to the following three main reasons (Mohan 2009). This discussion will explore these challenges and present recommendations that may alleviate them.

Company History

Liwa Company was established in 1939 as a petroleum company to make use of the available oil resources. By 1950, it had expanded its operations and acquired huge oil fields that enabled it to generate a lot of profits and invest in other similar operations (Rehman 2007). In 1990, Mr. Salah Salem AL-Shamsi established the famous Liwa Chemicals that enabled the company to venture into other activities including trading, supplying and providing technology, engineering, and high grade chemicals. In addition, it also offers shipping, oil, gas, water and hydrocarbon products and services. In 2005, it formed partnership with Occidental Petroleum (an American company) and this became a major boost in the operations of these companies. This partnership enabled them to win almost all exploration areas during the EPSA-4 Auction; therefore, making them the first international companies to take advantage of the lifted Libyan Embargo (Usa 2009). This company boasts of a state of modern technology and skills used in the oil, water, gas and energy sectors and continue to control the activities of other major companies like the ADNOC. Today, it has become an international company and formed partnerships with others to ensure it offers quality services and products to its clients. It has employed more than 20,000 workers in its operations and has more than 50,000 indirect employees.

Literature Review

10 Most Priced US Stocks- UBNT, VRA and LIWA by Sverrir Sverrisson

Sverrir Sverrisson is an American-based financial analyst working with a consultancy firm that manages various issues about equities, brokerage, stocks, food, beverage and tobacco products and services. In 2012, the consultancy firm established that Liwa Chemicals was among the best performing international companies that had expanded their operations to other countries. In addition, it was rated as the best company to form business links with due to its transparent and committed staff that ensured their clients and partners get what they deserve. Sverrisson argues that despite global financial meltdowns this company has managed to stay a head of its competitors and offered its clients high quality products and services (Mohan 2009). This has enabled it to rank highly in international stocks and attracted other related companies to form partnerships in exploring other investment opportunities and that this company will be a major player in the United Arab Emirates in the next fifteen years if the current trend is maintained.

Results and Discussion

There are many oil, water and gas exploration companies in the United Arab Emirates but this has not affected the operations of this company. The decision to partner with Occidental Petroleum was a wise move that enabled this company to expand its abilities to invest on international markets (Usa 2009). It has restricted its activities to the Arab region especially Abu Dhabi but when it formed this partnership this became an opportunity to explore oil markets and operations in other countries like Libya. In addition, there are all indications that it is set to expand its activities further and venture into other non oil related operations. Currently, it boasts of a steady and strong market supply of engineering and technology equipment to other oil companies and this has given it an edge over its competitors (Vicunas 2012). This is attributed to its partnering with the American company that has wide experience in the engineering and construction services.

This company offers consultancy, mechanical, electrical and manpower services to its clients; however, there is no other oil company that offers these services and this gives this company an upper hand in international and local markets (Vicunas 2012). Its strategic location in the Arab region makes it to incur limited expenses in the oil business. This is an advantage this company enjoys over others that are not located in this region. Its management is focused on establishing partnerships with companies that will add value to its operations by expanding them and ensuring they meet local and international markets. It is pursuing relations with others that offer different but related services like staffing, technology and legal issues. This will ensure that it is independent and able to satisfy its needs without necessarily relying on other companies (Rehman 2007). The success of this endeavor will ensure it reduces its operational costs and at the same time expand its operations.

Recommendations

Liwa Chemicals is an already established international company and this gives it various challenges that limit its abilities to make huge profits. First, it was established in an Arab land and thus has most of its operations based on the practices of this region. Terrorism has been greatly associated with this region and this limits its abilities to expand its operations in other countries located in the European region. However, it can manage these challenges by restructuring its management to include members from other non Arab nations. Secondly, it should continue to diversify its investments and ensure it does not rely on oil only since this is a natural resource that is not expected to last for a long time. It is estimated that this region will run out of oil deposits within the next seventy years; therefore, this company should start to diversify its investments before it is too late to do this.

Conclusion

The demand for oil will continue to offer this company huge markets for its goods and services in the local and international market. In addition, this company has opened its doors for partnerships with other companies to ensure it expands and maintains its operations. This means that despite the challenges mentioned above there are high chances that Liwa Chemicals will continue to dominate oil operations in the United Arab Emirates.

References

Mohan, B. (2009). Dubai (UAE) Oil, Gas Exploration and Energy Sector Laws and Regulation Handbook. New York: International Business Publications.

Rehman, A. (2007). Dubai and Company: Global Strategies for Doing Business in the Gulf States. New York: McGraw-Hill.

Usa, I. (2009). UAE Free Economic Zones Handbook (World Strategic and Business Information Library). New York: International Business Publications.

Vicunas, D. (2012). Oil and Governance: State-Owned Enterprises and the World Energy Supply. Cambridge: Cambridge University Press.

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