In our more than 80 years of managing the Kingdom’s oil and gas resources, continuous technological innovation has been the driving force behind our upstream operations and remains fundamental to our future success. Our technological advances have made exploration more effective and economical, opened new sources of supply, and enhanced our ability to recover more oil and gas to secure sustainable growth.
Every percentage increase in recovery rates adds millions of barrels of recoverable oil to our reserves base. Every gain in operating efficiency expands our ability to provide more energy at lower cost. More reserves and longer-lived production mean more energy for opportunities, in Saudi Arabia and for our customers around the globe.
Our upstream R&D addresses key oil and gas challenges: Improving seismic processing and analysis, increasing the effectiveness and efficiency of gas exploration, optimizing enhanced crude oil recovery methods, raising crude oil recovery rates, enhancing oil well productivity, and lowering production costs
The research activities are primarily performed in-house, with support from our Global Research Network research centers in Houston, Boston, and Beijing, and from our technology offices in Aberdeen, Scotland and Delft, the Netherlands.
We continued to increase the power and speed of GigaPOWERS, our parallel oil and water enhanced reservoir simulator, and TeraPOWERS, our next-generation reservoir and basin simulator, to improve our computational modeling. These enhancements improve the resolution of the models, giving our petroleum engineers a better understanding of the reservoir mechanics to enable maximum recovery and sustainable production for the long term.
We developed GeoDRIVE, our next-generation, integrated seismic imaging platform that enables ultra-high resolution subsurface mapping and characterization, and tested the platform in collaboration with the King Abdullah University of Science and Technology (KAUST). Our geophysical expertise, integrated with the power of Shaheen II, a KAUST supercomputer, successfully produced a 3-D image of subsurface geologic layers at a record resolution of 7.5 meters. This capability will enhance our understanding of challenging subsurface environments and help optimize drilling for exploration and production.
We continued monitoring the performance of our multi-well demonstration project in ‘Uthmaniyah, with the goals of sequestering carbon dioxide (CO2), developing related technologies, and enhancing oil recovery. To assess the effectiveness of the field pilot, the migration of the subsurface plume from the injected CO2 is being tracked through 4-D geophysical monitoring, interwell tracer tests, geochemical sampling, and time-lapse logging. The crude oil production response due to CO2 injection continued to show positive results.
Our state-of-the-art Geosteering Center in Dhahran enables real-time monitoring of drilling rigs hundreds of kilometers away to achieve precise, optimal well placement. Live drilling and downhole data is transmitted by satellite from rigs to the Geosteering Center where teams of experts analyze the data to make real-time decisions. Geosteering allows us to position wells for maximum reservoir contact, resulting in enhanced well productivity and reduced development costs. In 2017, our Geosteering program achieved 93% reservoir contact efficiency.
Smart Flood uses injected seawater with ionic compositions that have been optimized to enhance the “sweep” of oil in carbonate reservoirs and improve recovery rates. In 2017, we completed tie-in activities and commissioned multiphase flow meters at our ‘Uthmaniyah Smart Flood demonstration project.
We are exploring the use of seawater for fracturing operations to minimize the use of groundwater resources. We completed a field trial in Haradh and three more field trials are planned for 2018.
Targeting improved well site safety, as well as significantly reduced field operation costs and downtime, we continued our field trials of a cable deployed electric submersible pump (ESP). This technique enables the rapid deployment of ESPs using the pump’s power cable, rather than a workover rig. In 2017, we completed two installations, with a third planned for 2018. We also progressed preparations for a field trial of a slimmer version of the technology.
To improve recovery rates and long-term reservoir management, we are conducting a suite of nanotechnology research projects. Nanotechnology shows the potential to enable the monitoring and analysis of reservoir performance — and possibly intervention — directly from within the reservoir. In 2017, we identified scalable formulations of surface nanoparticles, which we plan to use in a single well chemical tracer field test in 2018.
Our upstream strategy: Leveraging advantages to maximize value
Designed to maximize long-term value, our upstream strategy focuses on leveraging our competitive advantages in production and scale. By tempering production from mature fields, accelerating younger fields and secondary reservoirs, and developing fresh reserves from new increments, we plan to create and sustain value for generations to come. To maintain our standing in the upstream sector, we seek to:
- Maintain our position as the world’s leading crude oil producer by production volume, and provide consistent, reliable, and competitive crude oil supply to customers
- Further diversify operations to capture value from strategic integration
- Expand natural gas activities to supply the Kingdom’s natural gas market
At a glance: Oil and gas mega-projects
Maintaining our reputation as a reliable producer of crude oil, and as a leading producer of natural gas, requires ongoing investment in our production capacity. In 2017, we continued to plan and execute a slate of mega-projects:
- Khurais field: Increase crude oil production capacity by 300,000 bpd in 2018
- Fazran field: Planned increase of crude oil production capacity by 75,000 bpd in 2020
- Dammam field: Expected start up of 25,000 bpd in 2021, increasing to 75,000 bpd in 2026
- Fadhili gas plant: Designed to process up to 2.5 billion scfd of gas, with startup planned in 2019