Politics
Local experts provide the latest information on Healthcare issues that matter to you
|
Fresh Ideas with Leigh Ann:
Recipes & Quick Tips |
Saudis show off $10 billion Khurais mega-project to ease doubts
10:23 AM EDT on Tuesday, June 24, 2008
KHURAIS OIL FIELD, Saudi Arabia – It is 111 degrees beneath a giant pipe rack here in the chalky sand desert. Yet 20,000 Asian workers are swarming over the hot metal girders and pressure vessels of a mile-long crude oil processing plant, a plant that by itself will handle enough oil to meet growth in global demand next year.
By June 2009, Saudi Aramco, the national oil company, expects to finish the $10 billion Khurais mega-project and add 1.2 million barrels a day to the kingdom's production capacity. The three fields involved in the project – Khurais, Abu Jifan and Mazalij – together hold 27 billion barrels, or more oil than all the proved reserves of the United States.
The Saudis invited more than 100 journalists to have a look at the Khurais project Monday as part of an effort to stem market perceptions that they're running into problems with their oil.
There wasn't much chance to poke around, but it's apparent that the hardware for this project is nearly in place. Aramco officials are more than confident that they have the technology and manpower to put a complex, three-field production plan into operation.
Skeptics who doubt Saudi Arabia's ability to meet growing world oil consumption point to Khurais as a project that shows the kingdom is reaching its limits.
Khurais will start off with a massive water injection system around the periphery of the giant field and with electronic submersible pumps in the production wells – steps Aramco normally uses after a field has been producing for several years.
Injecting more than 2 million barrels a day of treated seawater into the field will provide a pressure source to move the oil through the rocks a mile below the desert and into the field's production wells.
Amin Nasser, Aramco's senior vice president for production and exploration, said the decision to use submersible pumps was not about coaxing production from a weak field, but rather a function of cost.
Without the pumps to regulate flows, he said, Aramco would need to build several expensive gas-oil separation plants around the field. With the pumps, all of the separation work will be handled at the plant's central processing facility, Mr. Nasser said.
Like many other oil companies, Aramco isn't fond of the press and has been slow to respond to doubts and criticism. Mr. Nasser said the media has had a role in inflating prices by relaying much of the skepticism about Saudi fields.
The Jeddah energy meeting Sunday and the press tour of Khurais show the kingdom is fighting back, he said.
"Our actions have been louder than our words despite all the criticism and the cynics," he said. "That makes it even more important to let you see what's happening here on the ground for yourself."
Walking the desert around Khurais is like stepping too close to a bonfire. The sand ripples across the shimmering horizon in long, low dunes pocked with white stones and tufts of coarse brush. Unseen gas flares smudge the sky with black smoke.
The central processing plant in the center of the field comprises four trains, or lines, of crude oil treatment facilities that separate the oil from gas, salt and water. They are linked by a pipe rack that is four stories high and nearly a mile long.
The plant will be run from a "blast-proof" central control building, said Aramco spokesman Ziyad al-Shiha.
Treated oil will be held in three 600,000-barrel storage tanks before leaving the Khurais site in a gigantic highway of pipelines that stretches across Saudi Arabia from the Red Sea to the Persian Gulf. The pipelines can carry 5 million barrels a day.
Khurais project manager Khalid Abdulqader said the central processing facility was 55 percent complete, while the seawater treatment plant and pipeline network from the Persian Gulf to Khurais was 88 percent complete. He said seawater injection would start in December and oil production is on schedule to begin next June.
With world oil demand growing a little over 1 percent a year, producers will have to come up with many more production facilities in the years ahead. Mr. Nasser said Saudi Aramco would add 500,000 barrels a day from a field called Khursaniyah in August, 250,000 barrels a day from the Shaybah field in December and 100,000 barrels a day from a field called Naasyim, also in December.
Despite all that, oil markets continued to push oil prices higher Monday. Mr. Nasser said Aramco was mystified about why so many traders are behaving as if there were a shortage.
"We've asked all the international oil companies that buy from us if they want more oil," he said. "But we can't find customers."
Muhammad Saggar, Aramco's head of advanced exploration research, argued that complex technologies such as multiple lateral wells and nanorobot sensors swimming through oil-bearing rocks would help the Saudis recover much more of the oil in their giant fields.
Aramco can already recover half the oil in its fields, he said – well above the industry average of about 35 percent. The company expects to raise that rate to 70 percent over the next 20 years.
"By doing that alone, we will add 80 billion barrels of recoverable resources," he said.
Aramco said it had 259.9 billion barrels of recoverable reserves at the end of 2007, by far the largest of any company or nation in the world.






