KHOBAR: Saudi Arabia has granted additional time to one of the consortia hunting for gas in the vast desert in the country’s southeast, an industry source said on Monday.
In a rare opening for international firms, state-run Saudi Aramco set up four consortia in 2003-2004 to drill in the southeast, but so far they have failed to find the volumes of gas needed to fuel Saudi economic growth.
EniRepsa Gas Limited, which groups Eni, Repsol-YPF and Saudi Aramco, has been given an extension to April 2012 on the first phase of exploration, an industry source said.
The exploration period had been expected to end in 2010.
ENI declined to comment, while others could not immediately be reached for official comment.
A five-year program includes the acquisition of 5,000 kilometers of seismic data and the drilling of four exploration wells to explore and produce non-associated gas in block C, a 52,000-square km area of the Rub al-Khali basin.
The group has completed drilling work at three wells, but drilling the last exploration well was delayed to the second half of next year.
"The last well was delayed to reprocess seismic data," the source said.
ENI holds a 50 percent stake in the consortium; Repsol owns 30 percent, while Aramco has the rest.
Limited Discoveries So far
Other joint ventures include Royal Dutch Shell, China’s Sinopec and Russia’s Lukoil.
None of the companies has made big gas finds, but Lukoil-Aramco joint venture Luksar has made two gas discoveries.
The Shell-Aramco joint venture, the South Rub al-Khali Co (Srak), has also made discoveries.
Srak said last year that gas from two zones under exploration in the region flowed at a combined rate of 90 million cubic feet per day (cfd).
Terms agreed with Aramco are so poor; analysts say that the consortia need to find condensates — a form of light oil — which can be sold at international market prices to cover the cost of development.
That has meant the firms have been seeking gas rich in condensate, rather than just gas, and that is much harder to find.
Additional reporting by Svetlana Kovalyova.