Page 4 - GLNG Week 50 2022

GLNG COMMENTARY GLNG

AGOC, KGOC

implement Dorra

gas deal

COMMENTARY Subsidiaries of Saudi Aramco and Kuwait Joint Operations (WJO) area, signed an MoU for
Petroleum Corp. (KPC) this week signed a the export of gas from the onshore field which
memorandum of understanding (MoU) on the has an oil production capacity of around 250,000
development of the Dorra gas field in the two bpd.
countries’ shared offshore area. KGOC’s deputy CEO Muhammad Salem
Under the patronage of energy ministers Al-Haimer told KUNA that gas flows are
Prince Abdulaziz bin Salman Al Saud and Dr. expected to begin at 12 mmcf (340,000 cubic
Bader Hamid Al-Mulla, Kuwait Gulf Oil Co. metres) per day of gas, rising over the first half of
(KGOC) and Aramco Gulf Oil Co. (AGOC) the year to 40-50 mmcf (1.13-1.4 mcm) per day
agreed to jointly develop the field in the Parti- and reaching 80-100 mmcf (2.27-2.8 mcm) per
tioned Neutral Zone (PNZ). day within four years.
KGOC is the PNZ-focused affiliate of Kuwait The gas will be supplied to KOC for use in
Oil Co. (KOC), itself a subsidiary of the Kuwait the company’s gas networks. Meanwhile, oper-
Petroleum Corp. (KPC) and works with Aramco ations began in August last year on the first
Gulf Co-operation Co. (AGOC) in Khafji Joint pipeline from the PNZ’s al-Khafji field, with 24
Operations (KJO) area. mmcf (680,000 cubic metres) of gas piped to
This week’s signing ceremony was signed by the company’s networks in Kuwait. The com-
AGOC president and CEO Ali bin Saleh Al-Ajmi pany reported that operating the conduit would
and KGOC CEO Khaled Nayef Al-Otaibi. “boost optimum use of the petroleum resources”
During a visit to Kuwait by Saudi Crown in the PNZ while meeting “local needs for gas,
Prince Mohammed bin Salman (MbS) in March, particularly at peak consumption times”.
the parties agreed to will “leverage modern tech- The deal is sure to elicit a response from
nologies” to increase gas production from the Iran, whose foreign ministry claimed the March
asset to 1bn cubic feet (28mn cubic metres) per agreement was illegal given that part of the
day alongside 84,000 barrels per day (bpd) of Dorra deposit is the Arash field which lies within
condensate. Iran’s borders.
Work on the field, which holds 280-310bn “The oil ministry has seen necessary prepa-
cubic metres of gas and around 300mn barrels rations and carried out studies to develop and
of oil, has been stalled since 2013. As with the use the shared field of Arash,” said Ahmad Asa-
development of the PNZ’s oil assets – Al-Khafji dzadeh, Deputy Oil Minister for International
(offshore) and Wafra (onshore) – gas output will and Commercial Affairs. “The reason to have
be divided evenly between KGOC and AGOC. delayed using this shared field was pending
The offshore portion of the zone also includes decision in demarcation disputes with Kuwait.
the minor Hout oilfield, where US services firm But given that the other side, regardless of the
McDermott previously carried out pipeline and previous talks and unilaterally, moves to develop
commissioning work for the partners’ Khafji the field, there is no reason for delay,” Asadzadeh
Joint Operations (KJO) entity. Previous efforts said.
to develop Dorra had been designed to yield Even without a demarcation of the field’s bor-
600mmcf (17 mcm) per day of gas. ders, it would be feasible for all three countries to
In January, KGOC and Saudi Arabian Chev- work together on development, he was also cited
ron (SAC), Aramco’s representative in the Wafra as saying, adding: “The oil ministry expresses its

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