Saudi Arabia Projects and Business Highlights 2014
Strangely this strategic U-turn comes in the same time as the crude oil price is free falling from the psychological barriers of $100 per barrels that everyone used to consider as the reference to last for ever as meeting the interests of all parties from producing countries to consuming countries.
With giant downstream projects such as Sadara, Saudi Aramco is reducing its reliance on its sole upstream sector and it contributes to reduce Kingdom petrochemical products import to support an emerging manufacturing sector.
Considering the priority given to the petrochemical sector to create employments and support the overall Kingdom economical development, the exploration of the natural gas fields, conventional or unconventional, and the monetization of the associated gas have popped up on the first page of Saudi Aramco long list of projects for the period 2014 to 2020.
With the fifth largest natural gas resources, Saudi Arabia benefits from a great potential of gas reserves for new petrochemical capacities and to replace crude oil in number of cases such as power generation.
In the same time, Saudi Basic Industries Corporation (Sabic) declared to start working on an inventive $ multi-billion Oil-To-Chemical project.
This project was announced as an anticipation of the crude oil price fall and may reflect Saudi Arabia assumption that crude oil prices may stay low for a long period of time.
In conclusion this year 2014 has seen drastic changes in Saudi Arabia projects selection which anyway will all require the most advanced technologies to be developed.
The national oil company (NOC) Saudi Aramco is on the verge to develop the tight gas fields identified in the northwest of the Kingdom to supply the gas-fired power plant required for the giant Maaden Phosphate City project currently under construction. Since the USA revolutionized the gas markets with the development of the shale gas, all the key players of the energy market such as Saudi Arabia needed to rethink their strategy.
The California-based international oil company (IOC) Chevron Corporation (Chevron)and its local partners, Saudi Aramco and Kuwait Oil Company (KOC) have validated the steamflooding technology to develop the Wafra heavy crude oil field in the onshore Partitioned Zone (PZ) between Saudi Arabia and Kuwait. The Partitioned Zone is located at the north east of Saudi Arabia and South of Kuwait and was created to allow both countries to explorer and produce oil and gas resources in this region disputed by both countries.
Saudi Aramco is preparing to award front end engineering and design (FEED) contracts to develop shale gas reserves as pilot projects in three different basins of Saudi Arabia. Despite all the challenges to implement the hydraulic fracturing techniques in Saudi Arabia, the Kingdom is keen to try it a real scale in order to boost its natural gas production. As OPEC largest producer of crude oil, Saudi Arabia is taking its leading role to regulate the global market prices for a barrel.
The world largest ethylene producer, Saudi Basic Industries Corporation (Sabic) is mulling over the design and construction of the world ever largest Oil-To-Chemical (OTC) complex in Saudi Arabia. In the same way as Saudi Aramco invested heavily these last years on the downstream activities, Sabic is considering again massive capital expenditure to expand its petrochemical activities in the Kingdom.
The international oil company (IOC) Royal Dutch Shell (Shell) and the global petrochemical group Saudi Basic Industries Corporation (Sabic) have agreed to expand their joint venture Saudi Petrochemical Company (Sadaf) with the addition of world-scale polyolefins production units on their existing site in the Al-Jubail Industrial Zone in Saudi Arabia.