Top oil exporter Saudi Arabia will expedite work on two offshore gas fields in the kingdom as it seeks to meet growing domestic energy demand, the weekly Middle East Economic Survey (MEES) reported. A spokesman with state oil giant Saudi Aramco declined to comment on the report on Sunday.
Demand for gas in the kingdom for power and industry is soaring due to an economic boom fuelled by the oil price rally of 2002-2008. But most Saudi gas is produced in association with oil output, so volumes fluctuate with oil production.
Saudi oil output is at its lowest in over six years as the kingdom and OPEC look to match international oil supply with rapidly falling demand. This has left gas supply in the kingdom tight. Development of the Arabiyah and Hisbah gas fields, which are not associated with oil production, would supply around 1.8 billion cubic feet per day (cfd), MEES reported. The projects were included in Aramcos expansion plan through 2014, it said.
"Bringing these fields on line would make sense," one industry source in the kingdom told Reuters on Sunday. "They really need the gas."
Five years of gas exploration by international companies in partnership with Aramco in the vast desert of south-east Saudi Arabia, known as the empty quarter, has failed to find the gas needed to meet future power and industry needs.
Aramco said last week it planned 144 projects through 2014, including eight projects it described as giant. It did not list the projects. Saudi Oil Minister Ali al-Naimi announced discoveries at the Arabiya and Hisbah gas fields in January.