'Enough oil to keep the crude culture going'

RIYADH: The global oil scene is not bleak as pundits are now coming round the assertion that there is enough oil beneath the surface to keep this crude civilisation moving.

In recent weeks the Saudi crude production capacity has touched the 12 million barrels a day mark. This was achieved by carrying out developments at three of its oilfields. This extends Saudi spare capacity to almost four million bpd.
In the meantime, it is also a known that Saudi Aramco wants to improve its oil recovery rate to 70 per cent from 50 per cent over the next 20 years by focusing on enhanced oil recovery (EOR) techniques and other new technologies. Aramco is endeavouring to expand its resources from 742 billion bbl to 900 billion bbl to address the world’s future energy needs.

‘In the most optimistic scenario, world oil demand is placed at 125 million b/d and this would require 15-40 million b/d of additional capacity and compensation for declining fields,’ Aramco senior vice-president exploration and production Amin H Nasser underlined at the last Offshore Technology conference in Houston.

Aramco has also been particularly successful in its water cut: for example, the Abqaiq Arab-D reservoir, which produces 300,000 b/d, has a water cut of 35 per cent. Oil recovery from the field is expected to increase to 70 per cent without EOR. Ghawar’s water cut is 28 per cent and it produces five million b/d of oil, he said.

‘Horizontal wells and equalisers to reduce the pressure drawdown helped with the water cut,’ Nasser added.

The Opec annual statistical bulletin (ASB) for 2008 released recently now claims that proven oil reserves of the group has gone up by more than 75 billion barrels in 2007 to reach 1.02 trillion barrels in 2008. The main source of the increase is Venezuela increasing its reserves to 172 billion barrels, a rise of about 73 billion barrels over 2007, the ASB said. This makes Venezuela the second largest crude holder within the Opec after Saudi Arabia. And with some minor adjustments in the reserves of the rest of the world, the Opec’s share of world oil reserves after this adjustment is seen going up to over 79 per cent. Indeed, the development could be unsettling for some, one has to concede. The increase in Venezuela’s reserves in recent years has been very sharp from the 76 billion barrels in 2003, as the country now adopts the policy of adding non-conventional heavy oil deposits to its conventional oil reserves.

And interestingly, if a similar practice is adopted by the US and Canada, the reserves’ picture in the world would alter completely. However, the world still lacks an agreed way of assessing a country’s reserves independently and therefore, reports like the ASB take whatever a country claims to be its reserves, one needs to point out.

Dawn