Page 5 - DMEA Week 41

DMEA COMMENTARY DMEA

state control, only $1.125bn is due to leave Saudi increase export revenues, Aramco is working to
coffers. However, considering Aramco’s new develop the country’s gas reserves.
public profile, it cannot afford to be seen miss- The company’s raw gas output is seen as
ing any payments, even to the government. expanding to 13.5bn standard cubic feet (382mn
Amid the strain of weak demand and depressed cubic metres) per day, with sales gas making up
prices, Aramco is unsurprisingly considering its 8.5-9.0 bcf (241-255 mcm) per day from total
options to increase revenues. proven gas reserves of 324 trillion cubic feet
In addition, while Aramco reeled in its (9.17 trillion cubic metres).
spending plans for the full year, first-half capi- In his interview, Nasser said: “Our portfolio
tal expenditure amounted to $13.6bn. MEOG in gas will expand significantly in kingdom and
understands that the full-year capital pro- out of kingdom, including LNG in the future.”
gramme has been reduced by $10-15bn in reac- Domestically, the focus will be on unconven-
tion to the crisis. tionals. In February, Aramco announced plans
With reduced spending, the company’s to develop Jafurah, which holds an estimated 200
expansion appears likely to focus on picking up tcf (5.66 tcm), with liquids making up more than
bargains, which in the current market is likely to 50% of the resource.
prove far less challenging than developing green- The development plan involves a spend of
field refineries. $110bn, with production estimated to begin in
At the core of this strategy is the aim of guar- 2024, growing to 2.2 bcf (62.3 mcm) per day of
anteeing crude placement in overseas markets. sales gas by 2036. Considering the pressure on
capital expenditure, this project is likely to be
Gas heavily scrutinised, but MEOG’s sources suggest
With Saudi Arabian gas consumption rising that it has been effectively ring-fenced and will
quickly as Riyadh seeks to reduce crude burn to proceed largely as planned. ™

Week 41 15•October•2020 www. NEWSBASE .com P5