Saudi Aramco finds oil and gas in Red Sea

gas rig  Enrico Strocchi flickrBarclays Capital stated that Saudi Arabia's sustained investment in gas would ensure spending remains elevated in the region. (Image source: Enrico Strocchi/Flickr) Petroleum and natural gas company Saudi Aramco has confirmed its discovery of three oil and two gas fields in the Red Sea

According to Saudi Aramco's annual report, a deepwater oil field Al-Haryd and a gas field in the Shaur structure were found in 2013. The company also executed its first deepwater drill stem test at Duba-1 in the northern Red Sea at a depth of 648m, in 2013.

The shallow water offshore Manifa field in eastern Saudi Arabia began production in April 2013, three months ahead of schedule, with oil output reaching 500,000 bpd by July. Reports stated that Manifa will have the capacity to produce 900,000 bpd of heavy crude and deliver feedstock to the industrial towns of Jubail and Yanbu by the end of 2014.

Saudi Aramco's continued focus on unconventional gas this year would ensure that energy investment spending remains elevated in the region. Financial services company Barclays Capital has projected that Middle East oil and has producers would spend US$40bn in 2014 on exploration and production – a 15 per cent increase, making it the highest in years.

Jamie West, an analyst at Barclays Capital, said, "Saudi Aramco continues to step up its unconventional activities and exploration efforts in the Red Sea – a mix of shallow-water and ultra-deepwater work. The national oil company recently disclosed that it completed 361 wells during 2013, including 29 unconventional gas wells."

Test results at Saudi Aramco's Red Sea deepwater well indicated tight reservoirs for potential future development, which could lead to additional deepwater rigs. The company is focusing on boosting domestic gas production for industrial and residential use, in a bid to increase oil exports and revenue, and is likely to pursue offshore gas anad related R&D investment in the coming years, added Barclays Capital.

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