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Aramco ramps up hunt for Saudi unconventionals

Saudi Aramco is looking to delineate unconventional tight-oil and shale-gas resources using expertise gleaned from the US

Saleh M Saleh, the chief explorationist for Aramco’s newly-founded unconventional gas division, said the company is working with service providers like Schlumberger and Baker Hughes to train 50 people and apply experience from US plays such as Eagle Ford that can be taken back to Saudi Arabia.

Speaking at the World Shale Gas conference in Houston, Saleh said prior experience from US plays has shown the unconventional resource can be an order of magnitude — five to 10 times — higher that of the conventional resource base.

Given Saudi’s 260 billion barrels of proven reserves, and 279 trillion cubic feet (cf) of natural gas, the unconventional resource potential could eclipse the world’s entire known reserves of petroleum energy.

Aramco is embarking on a two-to-three year programme of identifying unconventional resource opportunities in the kingdom — what Saleh describes as “proof of concept” — before devising and implementing a development plan.

Saleh said population is increasing the need for domestic energy sources. The kingdom would like to replace the use of diesel fuel with cleaner burning natural gas to power desalination plants and generate electricity. Additionally, gas provides an ideal feedstock for petrochemicals.

“This is a motivation to find more gas”, he says.

Initial efforts will focus around south Ghawar, the northwest deserts near Iraq and Jordan, and the Jurassic and Cretaceous reservoirs of the Rub al Khali, or Empty Quarter. Ghawar, the word’s largest oilfield, benefits from existing infrastructure that can keep costs relatively low.

The region is known for large tight-gas deposits surrounding the main producing oilfield, as well as large regionally dispersed shales. Rub al Khali is relatively under explored by Saudi standards and hosts the Shaybah oilfield, with reserves of more than 14 billion barrels of oil and 25 trillion cf of gas.

In addition to determining the overall economics of unconventional drilling, the project will focus on data acquisition and integration to come up with a programme tailored for Saudi Arabia’s unique geological setting. “You cannot just take existing technology from North America and bring it to Saudi Arabia. We fully understand you have to adopt a different organisational model,” he notes.

Such a shift will entail a measure of outside participation in the energy sector that Aramco has been reluctant to embrace after it became the world’s largest privately-held company in 1988.

Yet Saleh says Aramco recognises the “key” to the success in the US lies with the services sector that has developed and implemented new production technologies on a broad scale.

The delineation phase will be a key opportunity for those outside service and supply contractors to come to Saudi Arabia and develop a supply chain tailored for the local market. “This is a good time for the companies to come to Saudi Arabia,” he said. “We are learning from the North American experience... success is our only option.”

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