Aramco's $25 Billion Gas Expansion To Increase Production By 60% By 2030

Aramco has awarded contracts worth over $25 billion to advance its strategic gas expansion. This initiative aims to boost sales gas production by more than 60% by 2030 compared to 2021 levels. The contracts cover phase two development of the Jafurah unconventional gas field, phase three expansion of the Master Gas System, new gas rigs, and ongoing capacity maintenance.

Aramco President & CEO Amin H. Nasser stated, "These contract awards demonstrate our firm belief in the future of gas as an important energy source, as well as a vital feedstock for downstream industries. The scale of our ongoing investment at Jafurah and the expansion of our Master Gas System underscores our intention to further integrate and grow our gas business to meet anticipated rising demand.

"This complements the diversification of our portfolio, creates new employment opportunities, and supports the Kingdom’s transition towards a lower-emission power grid, in which gas and renewables gradually displace liquids-based power generation. To get where we are today, a lot of hard work, innovation, and a strong 'can do’ spirit has been demonstrated by teams across our vast network of suppliers and service providers, who have joined Aramco on this journey to build and expand our world-class energy infrastructure."

The company has awarded 16 contracts worth around $12.4 billion for phase two development at Jafurah. This includes constructing gas compression facilities and associated pipelines, expanding the Jafurah Gas Plant with new processing trains, utilities, sulfur, and export facilities. Additionally, it involves building new Riyas Natural Gas Liquids (NGL) fractionation facilities in Jubail to process NGL received from Jafurah.

The Jafurah unconventional gas field is estimated to contain 229 trillion standard cubic feet of raw gas and 75 billion stock tank barrels of condensate. Phase one began in November 2021 and is on schedule with initial start-up expected in Q3 2025. Aramco anticipates total lifecycle investment at Jafurah will exceed $100 billion with sustainable sales gas production reaching two billion standard cubic feet per day by 2030.

Another 15 lump-sum turnkey contracts worth about $8.8 billion have been awarded for phase three expansion of the Master Gas System. This project aims to increase network size and capacity by an additional 3.15 billion standard cubic feet per day by 2028 through installing around 4,000 km of pipelines and 17 new gas compression trains.

Aramco’s Master Gas System is an extensive pipeline network connecting key production and processing sites across Saudi Arabia. Since its inception in 1982, it has transported associated gas instead of flaring it during oil production. This system now transports both associated and sales gas, helping Aramco achieve near-zero routine flaring since 2012.

Additional Contracts Awarded

An additional $2.4 billion has been allocated for 23 new gas rig contracts along with two directional drilling contracts worth $612 million. Furthermore, between December 2022 and May 2024, Aramco awarded 13 well tie-in contracts at Jafurah totaling $1.63 billion.

Nasser appreciated the continuous support from His Royal Highness Prince Abdulaziz bin Salman bin Abdulaziz Al Saud, Minister of Energy. He noted the Minister's dedication to making Saudi Arabia's energy industry a global model in growth, reliability, development, and diversity.

The expansion will provide increased access to domestic gas supplies for industrial customers while offering a lower greenhouse emission alternative to oil for power generation.

Aramco expects these investments will not only meet rising demand but also support Saudi Arabia's transition towards a lower-emission power grid where renewables gradually replace liquid-based power generation.

This strategic move aligns with Aramco's goal to diversify its portfolio while creating job opportunities within the Kingdom.

With inputs from SPA