Tight Gas To Displace Shale
BMI View : Aramco's strategic shift away from shale gas and towards tight gas will offer a more economically viable route to unconventional resource development. However, given various technological and financial barriers to production, we see offshore and associated gas continue to dominate output growth across our 10-year forecast period.
In its 2013 Annual Review, Saudi Arabian national oil company (NOC) Saudi Aramco made unconventional gas resource development a key strategic focus. More specifically, the company placed a heavy emphasis on shale gas, targeting production of 2bn cubic metres (bcm) per year, by 2018. However, we argued that shale gas development would, under current conditions, prove uneconomic (see 'Unconventional Projects To See Slow Progress', June 05), and the shift in focus by Aramco seems to confirm us in this view.
Foster Wheeler has been awarded a front-end engineering and design (FEED) contract for work on Saudi Arabia's unconventional gas development programme. The contract covers a five year period and, significantly, will prioritise development of the Kingdom's tight gas, as opposed to shale gas, resources.
|Robust Growth With Risks To The Upside|
|Saudi Arabia Natural Gas Consumption And Production (bcm)|