While Blockchain has permeated across most industries, the oil and gas sector has yet to fully embrace this new technology from either an operational perspective or investment perspective. There are some examples within the MENA region that include ADNOC in Abu Dhabi and Aramco in KSA but these are still in the very first stages and are mostly from an operational standpoint.
With today’s technologies such as Blockchain and AI we can finally bring investment in the oil and gas sector to smaller investors who are accredited and thus democratize the market. Oil Ministries, oil producing countries can monetize their potential reserves, track liquidity requirements without facing financial deficit issues and even land owners with reserves on their land can raise capital to extract oil and gas without having to sell to big conglomerates.
Here is where PermianChain comes in. It has developed a platform that will democratize and transform the way investment in oil and gas reserves are made. UNLOCK met with Mr. Mohamed El-Masri, Co-Founder and Chief Executive Officer of PermianChain Technologies, a Toronto based company who has developed its tokenized equity investment platform and is now seeking regulatory license in the UAE. El-Masri discussed how blockchain is transforming the funding of oil and gas reservoirs using digital securities, while also increasing transparency and efficiency for the sector. El-Masri has had a lifetime experience in investment firms as a corporate finance advisor and when he met his co-founder who has a strong expertise in the oil and gas sector, both of them firmly believed it was time to disrupt the oil and gas investment market and from here they created PermianChain.
According to El-Masri, “We saw an opportunity for developing a private equity investment vehicle for regional accredited investors to invest in promising oil and gas reserves, which is why we established Permian Holding, a limited company registered in the Abu Dhabi Global Market (ADGM) where there exists established frameworks for digital securities, as we prepare for our tokenization event of our assets which is approaching soon”. The Technology company PermianChain is in Toronto Canada. PermianChain are now preparing to launch the investment platform in the UAE choosing ADGM as their go-to jurisdiction.
El-Masri explained, “We have developed a platform that is simple to use, that is intended to be in compliance with regulations and flexible enough to take scalability and changing conditions into account. With the technology company in Toronto, we have strategic access to serve North American natural resources owners that can be onboarded on our blockchain based private equity platform for oil and gas. Having the platform based out of the UAE, allows newfound liquidity from regional markets, ultimately funneling ROI (Return on Investment) back to the region. Our long-term plan is to develop the remaining pillars of the platform and apply for a license to operate the B2B digital hydrocarbon asset exchange in the appropriate jurisdictions where we can foster a global oil and gas trading network with transparent up to the second ownership rights.”
By tokenizing hydrocarbon reserves, the oil and gas financing sector will grow making it possible for a wider range of investors to participate. El-Masri explains, “While big conglomerates usually governmental or huge entities in nature have funded the extraction of oil and gas from reserves, there are many reserves owned by individuals or small to mid-size groups who have been unable to raise the needed funds to extract and utilize their reserves, with PermianChain they now have a better chance.”
Permianchain Technologies is harnessing the power of Blockchain (HyperLedger Fabric), data science and AI to digitize proven but unproduced oil and gas reserves. According to El-Masri, PermianChain has already secured oil and gas reserves with a reserve potential of 11.5 million BOE (Barrels of Oil Equivalent) and an upside potential of 50 million BOE to be registered on its network as a result of private funds raised by Permian Holding in its first round. PermianChain intends to revolutionize the way natural resources reserves are funded, produced, bought and sold using a permissioned based blockchain platform.”
PermianChain will start with reserves in North America, and are interested in Africa and MENA, but this is contingent on regulations. El-Masri believes that with an estimated 1.6 trillion barrels of proven oil reserves globally, the PermianChain will allow investors the opportunity to own a share of the world’s natural resources reserves.”