№10 October 2009
Saudi Arabia Expands Oil, Gas Plants for $100 Billion
Saudi Arabia, the world’s biggest oil producer, has started to expand and upgrade its oil and gas production and refining business at a cost of $100 billion to tap rising demand in Asia, Oil Minister Ali al-Naimi said.
“China’s and Asia’s demand are projected to be met mainly from supplies from Saudi Arabia and other Gulf states,” al- Naimi said in a speech at Beijing University today. Saudi Arabia is doubling its domestic and international oil refining capacity by 2015, he said.
The kingdom’s current share of refining capacity in China, Japan and South Korea totals 1.32 million barrels a day, Al-Naimi said. Demand for energy in Asia, which accounts for more than half of Saudi Arabia’s crude, oil products and natural gas exports, is poised to increase because of surging demand in China and India.
The International Energy Agency increased its forecast for 2010 global oil demand as the pace of economic recovery in Asia and the Middle East picks up. The kingdom increased its crude oil output capacity to 12.5 million barrels a day in June, al-Naimi said.
Saudi Arabia’s natural gas production and processing capacity will rise 4.5 billion cubic feet a day by 2014, equivalent to a 40 percent increase from current levels. Refinery Stake Saudi Arabia pumped 8.15 million barrels of oil a day in October, down from 8.2 million barrels a day in September, according to a Bloomberg estimate.
Saudi Aramco, the state oil company, owns 25 percent of a 240,000 barrel-a-day oil refinery in the southeastern Fujian province, together with Exxon Mobil Corp., China Petroleum & Chemical Corp. and the provincial government. It is also in talks to take a stake in China Petroleum’s 200,000 barrel-a-day Qingdao refinery in the eastern Shandong province, Aramco Chief Executive Officer Khalid al-Falih said.
Global oil consumption is likely to average 86.2 million barrels a day next year, 140,000 barrels more than previously estimated, the IEA, an adviser to 28 nations, said in its monthly report yesterday. The IEA also raised its estimate for consumption this year to 84.9 million barrels a day, up 220,000 barrels from last month’s estimate.
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