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Dear Reader,
The U.S.-Saudi Arabian Business Council (USSABC) is pleased to offer you this summary of our recently
released Oil and Gas Sector in the Kingdom of Saudi Arabia report. Based on extensive research
gathered from Saudi Government documents, media agencies, and studies by non-governmental
organizations, this report presents a concise yet thorough overview of Saudi Arabias oil and gas industry,
including billions of dollars worth of investment opportunities.
The report provides an analysis of the most recent statistics and ongoing trends in the industry. It
describes the sectors regulatory structure and major developments. More importantly, these topics are
discussed within the framework of private and foreign investment opportunities. A current list of key
contacts for government ministries and leading Saudi companies in the industry is also included.
The 2009 Oil and Gas Sector report is a great resource for companies interested in learning more about
Saudi Arabias growing hydrocarbon industry. Combined with the Councils other business development
services, the report provides companies with a valuable first step toward breaking into the Saudi market,
which boasts a combined $1.4 trillion worth of investment opportunities through 2020.
To obtain a complete copy of the report, please see the back cover for additional information.
Sincerely,
Edward Burton
President and Managing Director
U.S.-Saudi Arabian Business Council
________________________________________________________________________
U.S. - Saudi Arabian Business Council
Strengthening Bilateral Business Relations through Trade and Investment
TABLE OF CONTENTS
Executive Summary
SWOT Analysis Oil & Gas
Industry Structure
Oil Reserves
Oil Production & Consumption
Oil Exports
Development Plans
Khursaniyah Field Development
Manifa Field Development
Khurais Increment Program
Shaybah Increment Program
Wafra Increment Program
Other Field Developments
Refining Industry
Refining Production
Ras Tanura Refinery
SAMREF
Rabigh Refinery
SASREF
Yanbu
Riyadh Refinery
International Refineries
Refining Exports
Development Plans
Rabigh Refining and Petrochemical Company (Petro-Rabigh)
Ras Tanura Refining and Petrochemical Project
Yanbu Refinery Upgrade
SAMREF Refinery Upgrade
SATORP
Saudi Aramco/ConocoPhilips Refinery
Jizan Refinery
Refining Facilities Worldwide
Natural Gas Overview
Natural Gas Reserves
Natural Gas Production & Consumption
Natural Gas Development Plans
Hawiyah Gas Development Project
Haradh Gas Development Project
Karan Development Program
Khursaniyah Gas Program
Khurais Gas Development Program
Yanbu Gas Plant Development
Storage Facilities
Transportation and Distribution
Terminals
Investment Opportunities
Key Contacts
Saudi Arabian Government
Saudi Aramco
USSABC Saudi Members in the Oil & Gas Sector
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________________________________________________________________________
U.S. - Saudi Arabian Business Council
Strengthening Bilateral Business Relations through Trade and Investment
Owner
Saudi Aramco
Saudi Aramco
Saudi Aramco
Saudi Aramco
Saudi Aramco
Saudi Aramco/
ExxonMobil
Saudi Aramco/
Shell
Saudi Aramco/Total
Saudi Aramco/
ConocoPhillips
Capacity
550,000 bpd
400,000 bpd
235,000 bpd
120,000 bpd
85,000 bpd
400,000 bpd
305,000 bpd
400,000 bpd
400,000 bpd
Natural Gas Reserves (2008 est.): 257.8 trillion cubic feet (tcf)
Natural Gas production average per day (2007): 7.99 billion cubic feet
Natural Gas Liquids production average per day (2007): 1.1 million barrels
Major Pipelines (capacity): Petroline (5 million barrels per day), Iraq Pipeline across Saudi Arabia (1.65
million bpd, closed in 1990), Tapline (0.5 million bpd, closed in 1984), Abqaiq-Yanbu NGL line (0.29 million
bpd)
Major Oil Terminals: Ras Tanura (6 million bpd capacity), Yanbu (5 million bpd capacity), Ras al-Ju'aymah
(3 - 3.6 million bpd capacity); Jizan; Ras al-Khafji; Rabigh; Zuluf; Jubail.
Tankers (Saudi Aramco/Vela): 19 very large crude carriers (VLCCs), 4 ultra large crude carriers (ULCCs).
Daewoo Shipbuilding and Marine Engineering will deliver four VLCCs in 2009. The National Shipping
Company of Saudi Arabia (NSCSA) has 9 VLCCs, with a total 27 vessels, including 14 chemical tankers and
four container vessels.
________________________________________________________________________
U.S. - Saudi Arabian Business Council
Strengthening Bilateral Business Relations through Trade and Investment
OVERVIEW OF THE
OIL AND GAS SECTOR IN SAUDI ARABIA
For decades, Saudi Arabias economic development has been driven by the strong success its oil industry. Saudi
Arabia is the worlds largest producer and exporter of petroleum liquids and is currently the worlds second largest
crude oil producer behind Russia. Saudi Arabias economy remains heavily dependent on oil and petroleum-related
industries, including petrochemicals and petroleum refining. According to the International Monetary Fund, oil export
revenues account for around 90 percent of total Saudi export earnings and above 40 percent of the country's gross
domestic product (GDP). Meanwhile, Saudi Arabia is also the Middle Easts fastest growing consumer of energy, due
in part to its rapidly growing population and large-scale development projects. Domestic consumption has also been
stimulated by historically high oil prices and large government fuel subsidies.
Saudi Arabia's long-term goal is to further develop its lighter crude reserves
including the Shaybah Field, located in the Empty Quarter (Rub al-Khali) area
bordering the United Arab Emirates, the Abu Hadriya, Fadhili and Khursaniyah
(AFK) fields and the giant Khurais Field. In 2005, the Saudi Ministry of
Petroleum and Mineral Resources announced an ambitious goal of increasing
capacity to 12.5 million barrels per day (bpd) by the end of 2009. While
production levels dipped slightly in the late 2008, the government remains
confident that it will achieve its production target. The Saudi government has
even given mention to production targets following 2009, including an increase
to 15 million bpd after 2011.
To reach these ambitious production targets and to meet the growing demand
for energy around the world, the country will invest billions of dollars to boost
production capacity by developing new projects and upgrading existing ones.
While the global recession that began in 2008 has presented new economic
challenges, Saudi Arabia is pushing forward with many of its development
projects in the oil and gas sector, as it is a strategic component of not only the
Saudi economy but also the global economy. Saudi Aramco has extended
deadlines for EPC bids in a number of other projects, including the export
refineries at Jubail and Yanbu, in order to encourage more competitive bidding
that reflects declining construction costs. In March 2009, the Saudi Arabian Ministry of Petroleum and Mineral
Resources announced plans to spend approximately $60 billion on upstream and downstream operations through
2014. The budget includes allocations for 144 projects, including 17 mega-projects (those valued at more than $1
billion), 30 large projects, 17 medium-sized projects, and 80 small schemes.
Increased spending means more business opportunities for private firms. In 2002, the Supreme Economic Council
(SEC) approved a privatization strategy directed at advancing Saudi Arabias privatization drive and expanding the
role of the private sector and foreign investors in the Kingdom, including petroleum and energy support services.
Further, Saudi Aramco has announced that industry expansion and new production targets will be met largely through
increased private investment.
The U.S. continues to occupy the position of Saudi Arabias largest trading partner. Saudis maintain a preference for
American products and services. In fact, the U.S. Commercial Service estimates that U.S. companies possess a 50percent share of the market for engineered products. Within the oil and gas sector, there is a constant demand for
experienced companies and quality products in areas such as engineering, design, construction, and consulting.
________________________________________________________________________
U.S. - Saudi Arabian Business Council
Strengthening Bilateral Business Relations through Trade and Investment
El Seif Group
www.el-seif.com.sa
Al Dhahry Group
www.al-dhahry-group.com
Saudi Aramco
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Networking Services
Newsletter
A Business Guide to Saudi Arabia
Industry Sector Reports
Sponsorship Opportunities
________________________________________________________________________
U.S. - Saudi Arabian Business Council
Strengthening Bilateral Business Relations through Trade and Investment
________________________________________________________________________
U.S. - Saudi Arabian Business Council
Strengthening Bilateral Business Relations through Trade and Investment