Saudi Arabia's state oil company Aramco said it has signed contracts for the second phase of the expansion of its Jafurah gas field and the third phase of expanding its main gas network.
The awarded contracts are worth more than $25 billion, and will target sales gas production growth of more than 60% by 2030, compared to 2021 levels.
Aramco President and CEO Amin H. Nasser said the contract awards "demonstrate our firm belief in the future of gas as an important energy source, as well as a vital feedstock for downstream industries. The scale of our ongoing investment at Jafurah and the expansion of our Master Gas System underscores our intention to further integrate and grow our gas business to meet anticipated rising demand."
"This complements the diversification of our portfolio, creates new employment opportunities, and supports the Kingdom’s transition towards a lower-emission power grid, in which gas and renewables gradually displace liquids-based power generation. To get where we are today, a lot of hard work, innovation and a strong ‘can do’ spirit has been demonstrated by teams across our vast network of suppliers and service providers, who have joined Aramco on this journey to build and expand our world-class energy infrastructure,” he added.
According to Aramco, the Company has awarded 16 contracts, worth a combined total of around $12.4 billion, for phase two development at Jafurah. The work will involve construction of gas compression facilities and associated pipelines, expansion of the Jafurah Gas Plant including construction of gas processing trains, and utilities, sulfur and export facilities. It will also involve construction of the Company’s new Riyas Natural Gas Liquids (NGL) fractionation facilities in Jubail — including NGL fractionation trains, and utilities, storage and export facilities — to process NGL received from Jafurah.
Another 15 lump sum turnkey contracts, worth a combined total of around $8.8 billion, have been awarded to commence the phase three expansion of the Master Gas System, which delivers natural gas to customers across the Kingdom of Saudi Arabia. The expansion, being conducted in collaboration with the Ministry of Energy, will increase the size of the network and raise its total capacity by an additional 3.15 billion standard cubic feet per day (bscfd) by 2028, through the installation of around 4,000km of pipelines and 17 new gas compression trains.
An additional 23 gas rig contracts worth $2.4bn have also been awarded, along with two directional drilling contracts worth $612 million. Meanwhile, 13 well tie-in contracts at Jafurah, worth a total of $1.63bn, have been awarded between December 2022 and May 2024.
Progress at Jafurah
The Jafurah unconventional gas field is estimated to contain 229 trillion standard cubic feet of raw gas and 75 billion Stock Tank Barrels of condensate. Phase one of the Jafurah development program, which commenced in November 2021, is progressing on schedule with initial start-up anticipated in the third quarter of 2025. Aramco expects total overall lifecycle investment at Jafurah to exceed $100 billion and production to reach a sustainable sales gas rate of two billion standard cubic feet per day by 2030, in addition to significant volumes of ethane, NGL and condensate.
