Abu Dhabi, UAETuesday 19 November 2019

Saudi Aramco awards $18bn worth of energy contracts to boost capacity

The world's largest crude exporter has around 12 million bpd of production capacity

An offshore oil platform associated with the offshore Marjan field. Getty Images
An offshore oil platform associated with the offshore Marjan field. Getty Images

Saudi Aramco awarded $18 billion (Dh66.1bn) worth of contracts to boost production capacity by 550,000 barrels per day at its Marjan and Berri oilfields as well as increase gas output by 2.5 billion cubic feet per day.

The Saudi state producer said on Tuesday around 34 contracts were awarded as the world’s largest oil exporter looks to sustain its production capacity at 12 million bpd.

“These two programmes will significantly enhance Saudi Aramco’s oil production and gas processing capabilities, both strengthening our position as the leading integrated energy supplier and meeting growing long-term demand for petroleum,” said Saudi Aramco chief executive Amin Nasser.

The new investments will help reduce the “carbon intensity” of crude as well as reducing emissions, he added.

Saudi Arabia accounts for 13 per cent of global crude output, all of it produced by Aramco, according to the latest BP Statistical Review of World Energy. The country has been undertaking voluntary production cuts since January that pared its output to 9.69 million bpd for May, according to the latest Opec monthly statistics.

Increasing production capacity at Marjan, an offshore field, and Berri, which lies partly onshore, is a long-term scheme for Saudi Arabia to boost its spare capacity.

Around 90 firms put in bids for the packages associated with the fields, including 16 Saudi companies, which accounted for half of those chosen, to execute the projects as part of efforts to increase local content in the energy sector.

The Marjan increment programme, as the scheme is known, includes a new offshore gas oil separation plant as well as 24 offshore oil, gas and water injection platforms.

Saudi Aramco also plans to expand its oil facilities associated with its onshore Tanajib field, with the construction of a new gas plant, a gas treatment, processing, natural gas liquids and fractionation, and compression facilities. A "cogeneration facility" is also expected to be developed in addition to a water desalination plant and new transfer pipelines, the company added.

Marjan is expected to have the capacity to produce 300,000 bpd of Arabian medium crude, 2.5 billion cubic feet per day of gas and 360,000 bpd of natural gas liquids, while the increment programme on the Berri field would add 250,000 bpd of Arabian light crude.

Saudi Aramco also plans to add a new gas oil separation plant on Abu Ali island to process up to 500,000 bpd of Arabian light crude, as well as additional gas processing facilities at the Khursaniyah gas plant to process 40,000 bpd of associated condensate.

The scheme also includes provisions for a new water injection facility, two drilling islands, 11 oil and water offshore platforms and nine onshore oil production and water supply drill sites.

Updated: July 9, 2019 05:47 PM