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MEOG COMMENTARY MEOG

Facilities at the offshore
Manifa oilfield.

In addition, no mention has been made of the Neutral Zone (PNZ) was estimated at 52,000
PRefChem facility in Malaysia, which has been bpd.
plagued by problems over the past 18 months, Meanwhile, work is still understood to be
with fires causing fatalities and closures for ongoing to increase the capacity of the East-West
investigations. Pipeline from 5mn bpd to 7mn bpd.
However, speaking to reporters on August 9, The company plans to keep expanding. Nas-
Nasser said that talks with Reliance Industries ser said: “We are proceeding with increasing our
were still ongoing regarding a $15bn deal to MSC from 12mn bpd to 13mn bpd. It should
acquire 20% of the Indian firm’s oil-to-chemicals not have a major impact on capital in 2021.”
(OTC) business. “The work is still on. We will However, the 12mn bpd number has rarely been
update our shareholders in due course.” tested and given that a portion of the record pro-
Given the state of the market, it would appear duction levels seen in April were understood to
unlikely that Aramco would rush into such have come from storage, programmes at Marjan,
a deal and talks had already cooled in recent Berri, Zuluf and others will certainly need to be
months, despite the potential deal being seen as revitalised in order to achieve 13mn bpd, and
a replacement for Aramco’s crude oil-to-chem- this is without considering reservoir depletion
icals (COTC) project, which was reshaped into at mature fields.
efforts to enhance facilities at Yanbu’ refinery. A company source, speaking to MEOG on
condition of anonymity, said: “It has been a year
Activity of ups and downs for Aramco. It started so well,
As part of wide-ranging efforts to minimise the but the oil price war was a disaster, and it went
business impact of COVID-19, Aramco delayed from bad to worse as the lockdowns ruined
by six months the Marjan and Berri crude demand projections. However, unlike many
increment programmes: projects that are set to other of the world’s largest oil producers, it made
more than double oil production capacity from a profit and stuck with its dividend commitment.
the assets to a combined 1.35mn bpd at a cost Having said that, part of the dip in performance
of around $18bn. These developments are also was of Saudi Arabia’s own causing.”
expected to result in the production of up to 2.5 Aramco remains a company unlike any other
bcf (71 mcm) per day of associated gas, which and it has filled the Kingdom’s treasury in return
will be piped to the Berri gas plant. for its exclusive concession to develop Saudi’s
During the first half of the year, premium world-class reserves. However, as public scru-
crude is understood to have comprised more tiny grows stronger, this hydrocarbon wealth is
than 60% of the company’s production, while the unlikely to continue bailing Riyadh out of poor
mid-year average output from the Partitioned decision-making.™

Week 32 12•August•2020 www. NEWSBASE .com P5