Saudi Arabia: Engineering New Mining and Industrial Hub Created for Increasing Gas Supply
The new industrial hub aims at meeting the Saudi Aramco’s long term strategy to increase gas supply along with the region’s economic diversification programme to generate growth in new sectors. The inauguration of the mega project was carried out by King Salman bin Abdulaziz Al Saud, custodian of the two holy mosques in the country.
Dhahran/Saudi Arabia – Wa’ad Al Shamal, or ‘Northern Promise’ will be a new industrial city located 30 km west of Turaif, which is set to become a major mining hub. Spread over 440 sq kilometers, and already hosting phosphate processing facilities, Wa’ad Al Shamal will increase economic and industrial activity in the northern region of Saudi Arabia. Developing new mining and mineral activities, especially phosphates, and downstream value added industries such as glass and plastic manufacturing, it is estimated that Wa’ad Al Shamal will generate 6.39 billion dollars from non-oil sectors and contribute 3 % to the Kingdom’s GDP. About 30,000 jobs are expected to be created for qualified Saudi youth, especially those from the region.
Delivering on its promise to fuel industries in the northern part of the Kingdom, as it is presently doing in developing the Jazan Economic City in southwestern Saudi Arabia, Saudi Aramco commenced commercial production of unconventional gas in the North Arabia Field in May 2018, supplying approximately 55 million standard cubic feet per day (mmscfd) to a local power plant. The gas production will ramp up to 190 mmscfd toward the end of 2018 to meet customers’ needs.
Saudi Aramco has made an investment of more than 2.6 billion dollars to supply the required energy feedstock to the city and its projects. Wa’ad Al Shamal is 1,000 kilometers away from Riyadh and supplying the city with competitive gas feedstock was initially deemed as complex and costly due to its terrain and geography. However, Saudi Aramco came up with a creative and efficient solution to explore and drill for gas resources in the region, specifically unconventional gas.
With foresight to foster human resources and support the national goal of creating additional job opportunities in the northern part of the Kingdom via the establishment of Wa’ad Al Shamal, Saudi Aramco reached out to schools in nearby cities and villages to promote upcoming opportunities with the company for high school graduates, such as the Apprenticeship Programme for Non-Employees. The prospect for a 100 % Saudi workforce, primarily from the North, is very high with the upcoming employment opportunities in line with the region’s growth.
Commercial production of natural gas signifies the first milestone in Saudi Aramco’s implementation phase of the unconventional resources extraction programme. Building on three crucial pillars of a sound de-risking strategy, a fit-for-purpose business model, and the building of capabilities in people and technology, the company’s Unconventional Resources (UR) organisation has made significant achievements over the past few years. The gas supply to support Wa’ad Al Shamal industrial projects will also help offset the increase in liquid burning for electricity in the area.
The UR organisation has completed drilling wells, installing more than 300 kilometers of pipelines, and building one surface processing facility (SPF) along with associated infrastructure, while the remaining four SPFs will come online by the year-end of 2018. Producing unconventional gas near Turaif will replace the burning of hydrocarbons for electricity generation. The result will be a reduction in carbon emissions while saving hydrocarbons for export to obtain higher value. The project’s best practices and experiences will benefit teams developing the remaining unconventional resources in the Kingdom, including the South Ghawar and Jafurah fields. In line with Saudi Vision 2030, these endeavors will contribute to increase the Kingdom’s natural gas production.
Saudi Aramco’s unconventional gas experience in North Arabia has been unique. Technology has been adapted to take into consideration the local environment, and the business model assisted in addressing the crucial aspect of cross-function collaboration. Thanks to world-leading, cutting-edge technology, Saudi Aramco is able to increase the chances of finding gas, while reducing the drilling and well delivery time, as well as costs, by 70 %.