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A Closer Look at Saudi Arabia

A Closer Look at Saudi Arabia thumbnail

A press release from The Carbon Capture and Sequestration Technologies Program at MIT,  December 6, 2013, Bold mine.

Uthmaniyah Fact Sheet: Commercial EOR using Anthropogenic Carbon Dioxide
Company/Alliance: Saudi Aramco
Location: Saudi Arabia
Start Date: 2013/2014
Size: 0.8 Mt/yr
CO2 Source: Hawiyah gas plant
Transportation: 70 Km onshore pipeline
Oil Field EOR Storage Site: Ghawar field
Reservoir Type: Jurassic Carbonate limestones

The objectives of the project are determination of incremental oil recovery (beyond water flooding), estimation of sequestered CO2, addressing the risks and uncertainties involved (including migration of CO2 within the reservoir), and identifying operational concerns. Specific CO2 monitoring objectives include developing a clear assessment of the CO2 potential (for both EOR and overall storage) and testing new technologies for CO2 monitoring.

Approximately 60–65% of all Saudi oil produced between 1948 and 2000 came from Ghawar. Cumulative production until April 2010 has exceeded 65 billion barrels. It was estimated that Ghawar produced about 5 million barrels of oil a day (6.25% of global production) in 2009. Ghawar also produces approximately 2 billion cubic feet of natural gas per day.

After 60 years of production, the field is depleted and Saudi Aramco is going to start CO2-EOR. The project will consist of 4 injection wells, 2 observation wells and 4 productions wells.

Is there any doubt anymore whether or not Ghawar is depleted? 2009 is likely the year when production began to fall fast in Ghawar. But it was already falling prior to that.

A bit of history. Three oil fields, discovered decades ago, were held offline because of economic and and other problems.

Shaybah: Discovered in 1968 but due to its remote location was not brought online until 1998 at 500,000 bpd. It was upgraded in 2009 and increased production to 750,000 bpd.

Khurais: Discovered in 1957 and brought online in 1959 and shut down in 1961 due to low production and remote location. It was brought back on line in the early 1970s. Khurais produced 144,000 bpd in 1981 but dropped off dramatically in 1982. Gas re-injection attempts to increase production failed and the field was shut down a short time later due to almost no natural pressure. In 2009 a new massive water injection program began with the injection of over 4 million barrels of water per day brought the field up to 1.2 million barrels of crude oil per day.

Manifa: Discovered in 1957 but shut down almost immediately because the oil was extra heavy and contaminated with vanadium. But Aramco built their own refineries to handle the oil. The field was put on line in April 2013 and was producing 500,000 bpd and will be producing 900,000 bpd in 2014.

It is these three fields that has kept Saudi production near 10 million barrels per day. But there are no more old fields to be brought on line. From here on out Saudi must rely on the fields it has.

Saudi Arabia

Okay, we know that Ghawar is depleted and in serious decline. But so is Safaniya, Abqaiq, Berri, Abu-Safah, Qatif, Zuluf, Marjan, and all the smaller fields in Saudi Arabia.

Saudi has three fields with a combined production of 2.8 to 2.9 million barrels per day that are not in decline. Everything else is seriously depleted and in serious decline. Matt Simmons, Twilight in the Desert Stuart Staniford, A Nosedive Toward the Desert and Chip Haynes Ghawar is Dying, were all absolutely correct… they were just all premature with their prognostications. They had not counted on Khurais and Manifa.

Saudi is diversifying, making preparations to increase their finished product income when oil production declines: Change is coming to Saudi Aramco, the state oil company

Time was when Saudi Aramco didn’t need to worry much about its ability to deliver all the oil needed to maintain Saudi Arabia’s share of the global market…

A quick glance at Aramco’s 2013 Annual Review, published last week, is enough to convince anyone that change is in the wind for the flagship Saudi state-owned enterprise.

“We have embarked on ambitious corporate transformation guided by our Strategic Intent, our overall vision for Saudi Aramco through 2020,” the review states.

 “These advancements will not only ensure that Saudi Aramco remains a global leader in crude oil and NGL production and exports, but will also propel us into the top tier of chemicals companies worldwide and reaffirm our commitment to the Kingdom’s future in a rapidly changing world.”

The IMF seems to be getting overly concerned about current stocks and future crude production: Looking into two Saudi IMF reports

And for that OPEC is expected to furnish the market with additional 800,000 bpd from what it used to produce in April, which was the lowest level of production in five years.
That could be attributed to three factors: the diminishing non-OPEC supplies, which will rise by 100,000 bpd only and the growing worry about the level of inventories, which remained ‘tight.’
IEA estimated that there is a ‘wide’ deficit of 110 million barrels to their five-year seasonal average, according to the report, which puts stockpiles in the 34 IEA members were at 2.57 billion barrels in March, down 2.5 million from the previous month.

Ghawar is Dying

Peak Oil Barrel by Ron Patterson

18 Comments on "A Closer Look at Saudi Arabia"

  1. shortonoil on Tue, 27th May 2014 4:12 pm 

    Aramco reservoir engineers admitted almost a decade ago that the water cut in Ghawar was better than 45%. The equations that relate water cut to oil seam thickness were published 30 years ago. Using those equations tells us that the remaining oil seam at Ghawar is less than 30 feet. That is 30 feet of the original 350 feet. Ghawar is over 90% depleted, and as Simmons said, “as goes Ghawar, goes the world”! The world’s usable petroleum reserve is now 75% depleted, and the last 25% will cost orders of magnitude more to produce than did the first 25%. Don’t let the present short term price restraint fool you. Much higher prices are yet to come!

  2. Aaron on Tue, 27th May 2014 4:30 pm 

    Is CO2 EOR feasible at current prices or do we need a price jump?

  3. Kenz300 on Tue, 27th May 2014 6:22 pm 

    China and India are growing their demand for oil every year. A spike in the price of oil is in our future.

    Big oil loves it when prices spike. They make huge windfall profits.

    The fossil fuel industry is doing all they can to block any transition to alternative energy sources……. They will stop at nothing to protect their profits.


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  4. Makati1 on Tue, 27th May 2014 8:35 pm 

    Looks like the Chinese made their energy deal with Russia just in time! With 1+ billion Chinese, I think they can build that new pipeline in record time, if necessary.

  5. Davy, Hermann, MO on Tue, 27th May 2014 8:45 pm 

    Sorry Mak, the Chinese are a basket case economy with a ponzi economics that is flying apart at the moment. They will soon be unable to address their multitude of problems that are in fact predicaments with a growth rate bellow 3%. Of all the countries in the World China is in the most precarious position of overshoot, environmental collapse, and economic spiral. I imagine the pipelines will never materialize. China will still be hacking coal out of the ground in a few years.

  6. bobinget on Tue, 27th May 2014 9:32 pm 

    Big city air… and they are all big cities in China is simply not fit to breathe. Something needs to be done immediately. Older cars are to be junked out. Coal fired power plants replaced with natural gas.. yes, THAT gas.

    Unlike Climate Change it’s impossible to hide poisonous air.

    It’s one thing for lumpenproletariat to inhale poisonous air. It’s quite another for a ruling class to do so. Coal burning was first banned for London in 1306
    cause Royals were becoming ill. Every 200 years coal
    was banned right up to the 20th Century.

  7. rockman on Tue, 27th May 2014 10:17 pm 

    Arron – Way too many variables and unknowns at Ghawar to make even a wild ass guess IMHO. But in general CO2 EOR can be profitable in many projects with $100 oil. But two points to remember: CO2 is not widely available where it could be useful and, more important IMHO, even when it works well it doesn’t unleash a new flood of oil. Its typically a relatively small rate increase over a long period of time. Can produce a good it of oil EVENTUALLY but not quickly.

  8. Makati1 on Tue, 27th May 2014 10:19 pm 

    bob, that is the US 50 years ago, and the US cities to come when coal is cheap and the only heat source in the US. They are only experiencing the pollution we exported to them when we sent them our factories and jobs. The US would use a lot more energy than we do if all those factories and jobs came back, not that they ever will.

  9. DMyers on Tue, 27th May 2014 11:42 pm 

    Ode to Ghawar

    Looks like the Big Boy is gone

    Been my cheap fix for so long

    I may be psychotic

    But I’m dreamin’ abiotic

    might refill the cavern ‘fore long

    We drained it in such a short time

    For automobile expansion sublime

    A trip to the mall

    from a place in the sprawl

    That car helped me save so much time!

    Can’t wait till we find a replacement

    I’m fracking a well in my basement

    There’s still plenty more

    If we drill to the core

    or suffer divine erasement

  10. Norm on Wed, 28th May 2014 1:35 am 

    Pray, and Jesus will fill it back up.

  11. dsula on Wed, 28th May 2014 6:47 am 

    Why is CO2 injected? Is that better than water? What about air? What’s the difference?

  12. Davy, Hermann, MO on Wed, 28th May 2014 6:50 am 

    What about nitrogen for that matter. I thought I remember reading Cantarell was using nitrogen

  13. Aaron on Wed, 28th May 2014 6:58 am 

    With CO2 they can tell the lie that they are pumping oil whilst saving the planet. Bullshit greenwash.

  14. peterjames on Wed, 28th May 2014 7:44 am 

    From my very weak understanding, water simply pushes the oil (they dont mix). C02 (often used in combination with water injection), mixes with the oil to reduce its viscosity. Effectively the water pushes whilst the CO2 lubricates the oil.

  15. Makati1 on Wed, 28th May 2014 8:47 am 

    Question: What happens to the spaces where this oil has been removed? Will the water remain there forever, or will it seep lower and allow the surface to collapse? After all, billions of cubic meters of oil have been removed over the decades? Ditto with the huge aquifers under the US. Logic tells me there has to have been some drop in the elevations over the years. Any answers from the engineers/geologists out there?

  16. rockman on Wed, 28th May 2014 10:07 am 

    M – Long answer. I need to get off my phone and on to the laptop in a bit to offer details

  17. rockman on Wed, 28th May 2014 11:06 am 

    This still more of a general description of EOR. They tend to be rather project specific. but first we need to describe reservoir drive dynamics. Two major categories. Water drive…think salad oil floating on your vinegar. And pressure depletion…think of a balloon deflating.

    The next complication: the nature of the hydrocarbon: from very easily flowing NG to thick tarlike heavy oil that is very resistant to flowing at all.

    Now you have 4 very general end points: WD light, WD thick, PD light and PD thick. each one requires a different EOR approach. There are other variables but for brevity we’ll skip them.

    Easier by example. Cantarell Field: nice movable oil but pressure depletion. Once the oil began producing the reservoir pressure began fall. And it’s the pressure differential that makes the oil move thru the rock: high pressure moves towards low pressure. So as pressure declines the flow declines. Drop the differential low enough and zero flow. So for “pressure maintenance” they began injecting N2 into the top of the reservoir. That expanding pressure cap pushes the oil downdip to the producing wells. They generate more N2 for that field then all the rest of the N2 created in the world.

    But when the expanding N2 cap reaches a producing well is “gasses out” and has to be taken off line. So such fields could look very healthy but if the gas cap reaches a lot of the produces at the same time production can quickly fall. I’ll guess that’s what happening at Cantarell. PD fileds typically have the lowest recovery if no EOR is applied…10% to 20%.

    Ghawar: Good oil and water drive. The water downdip easily flows up into the pore spaces the oil moves out of and thus maintains pressure. But as the water fills the pores near the producing wells the “water cut” increases. But there can still be a lot of oil lefts in the pore that isn’t moving…surface tension. some of these reservoirs have a strong water drive and some weak. The weak ones will usually have water injection started sooner then later.

    Now take those two situations and have thick oil. A CO2 flood in a PD reservoir is a great application: the pressure is maintained and the CO2 dissolves into the oil lowering the viscosity allowing it to move more easily. Can also help in a water drive reservoir by helping to break some of that surface tension.

    One can inject any gas or liquid for pressure maintenance. But some work better than others and sometimes the best solution is too expensive. But injecting air is a very different and rather exotic EOR method: the air will actually make the oil burn (combust). Called a “fire flood” or ISC…in situ combustion. About 10% to 15% of the oil is consumed. But generates pressure because the combustion products (including a lot of CO2) are a greater volumes then the oil. The higher temp also helps make the thicker oil flow. But a very complex method and something of a lost art these days. Was a big deal back in the 60’s. I know some perfect fields to apply it to that contain 100’s of millions of bbls of stranded oil but gave up to talk companies into it: just too complicated for most to understand.

    And that explanation just barely covers the subject.

  18. Yeti on Wed, 28th May 2014 8:08 pm 

    Thank you for that rockman!

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