dubai world, page-10

Yes, and I too stand corrected. D and AD are emirates not nations. And I agree, there is undoubtedly a lot of Royal Group money invested in Dubai, where the group's massive construction arm has also probably made a lot of its money. Discussion today was of Abu Dhabi bailing out Dubai to the tune of $US5bn, though not the $US10bn that it actually required to service its current debt.

Don't think it's likely to sink the Royal Group though, and is more than likely to encourage their investment in gold.


Re GMR / Royal Group, there was a rather similar deal done 30 years ago between the UK company Geosurvey Interenational (who were African-focused gold explorers and contractors) and an oil-financed Arab group.

As I remember it, the idea was that, in the wake of the 60s/70s oil crises and Arab Israeli conflicts, the group would employ Geosurvey Int. as their gold exploration arm, to find and then accumulate a large amount of gold, and then set up a gold-based Arab/Islamic bank. They took over Geosurvey International as their mineral exploration and development arm, just as many of the big multinational oil companies a the time also took over larger mining groups, and ran with the idea for several years.

But the project eventually foundered due to a lack of immediate exploration success. Neither the Arab group involved (nor the likes of British Petroleum and Esso) understood the difference between exploring for and producing oil in the Middle East and exploring for and producing gold in Africa. The timeframes involved, percentage success rates and profitability are incomparable.

Hopefully the Royal Group has a far more sophisticated understanding of what it is attempting, and I think that it has, and GMR are much closer to success at the outset, which they appear to be.