2004 News Story

Crown Prince Abdullah inaugurates Haradh Gas Project

Deputy Prime Minister and Commander of the National Guard Crown Prince Abdullah bin Abdulaziz today inaugurated the Natural Gas and Petroleum Development Project in Haradh, in the Rub Al-Khali (Empty Quarter). In his address on the occasion, Minister of Petroleum and Mineral Resources Ali Al-Naimi referred to the project as another of the Kingdom’s giant industrial projects, and described it as an integral part of an economic policy aimed at optimal exploitation of the country's natural wealth, while contributing to boosting development and diversifying exports. Priority has been given, he said, to the exploitation and development of natural gas, in order to meet increasing local demand, boost economic development and build up gas-based national industries.

The Kingdom’s gas industry successfully accomplished two major phases: first, the establishment 30 years ago of the main gas network that resulted in utilizing gas associated with crude oil instead of flaring it, while laying the foundations for the industrial cities of Jubail and Yanbu. The second phase began ten years ago and focused on increasing the network’s productive capacity from three to seven billion cubic feet daily and supplying natural gas to new areas such as Riyadh. During this period, the exploitation of newly-discovered reserves of non-associated gas expanded, with the result that Saudi Arabia's gas reserves are now around 235 trillion cubic feet, the fourth largest in the world.
In the third phase, processing plants for the non-associated gas have been constructed at Shaybah, Hawiyyah, and now Haradh; and Crown Prince Abdullah's gas initiative is providing opportunities for international investment in the exploration as well as exploitation for natural gas. Just two months ago a tripartite agreement was signed by Saudi Aramco, Shell, and TotalFinaElf on exploiting and producing natural gas in the southern part of the Rub Al-Khali. Over the next few weeks, data will be collected from the project’s aerial and seismological surveys covering around 210 square kilometers. Next week, another international tender will be launched for three new areas. After meeting local demands for gas, Saudi Arabia plans to export the surplus, thereby increasing its national income.
Highlighting the effort exerted by the private sector in the Haradh gas project, Minister Al-Naimi said that 40 percent of the materials used in its construction were locally manufactured. He added that focusing on gas has not distracted Saudi Aramco from promoting oil, pointing out that the Haradh project inaugurated today by the Crown Prince also involves the production of petroleum condensates and phosphates as well as processing around 300,000 barrels per day of crude oil.
Aramco President and CEO Abdullah Jumaa also addressed the gathering, pointing out that the Haradh plant is connected to the system of gas pipelines that supply Jubail, Yanbu and Riyadh, feeding petrochemical factories that produce 19 million tons annually, steel mills that produce 10 million tons a year, and power stations that produce 13,500 megawatts of electricity serving all the Saudi provinces as well as fueling desalination plants that provide 3 million cubic meters of fresh water and meet half of the Kingdom's needs. The projects to be implemented over the coming five years, he said, will provide thousands of direct and indirect jobs, and confirmed that the project’s operating team is 98 percent Saudi.
The recently completed mega project at Haradh consists of a gas plant capable of delivering 1.5 billion cubic feet of gas to the country's Master Gas System, and a gas-oil separator plant capable of stabilizing 300,000 barrels of crude oil per day. The Haradh Plant is Saudi Aramco's second facility built primarily to process large amounts of non-associated gas from gas reservoirs, the first being Hawiyyah, which went on stream in 2002. In addition to gas, Haradh has the capacity to deliver 170,000 bpd of condensate to Saudi Aramco's Abqaiq processing facility and can produce 90 tons of sulfur per day for export. The three mega projects - Shaybah, Hawiyyah and now Haradh - demonstrate Saudi Aramco’s competency in this area, and will contribute to the ongoing expansion of Saudi industry, further enhancing the investment climate.