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Saudi Aramco is in early-stage talks with potential equity investors that would help fund a huge $110 billion unconventional gas field development in the Kingdom, sources with knowledge of the negotiations told Bloomberg on Monday.
Aramco is seeking investors to back the field development of Jafurah, the largest non-associated gas field in Saudi Arabia, as the world’s top crude oil exporter looks to develop its gas assets to reduce dependence on oil for power generation and free up more crude for exports.
Saudi oil giant Aramco has therefore contacted private equity firms and infrastructure funds that could invest in the midstream and downstream projects associated with the huge gas field, Bloomberg’s sources said.
The Jafurah gas field is estimated to have 200 trillion cubic feet of rich raw gas, which will provide a valuable feedstock for the petrochemical industries, Aramco said in early 2020, when it announced the regulatory approval of the gas field’s development.
The pandemic and the related slump in energy demand and investments may have pushed back some of the plans, but with natural gas in high demand around the world these days, Aramco is said to be marketing parts of the Jafurah field development costs.
At the end of last year, Aramco awarded $10 billion worth of subsurface and EPC contracts for the Jafurah field development, and said it expects more than $100 billion in total overall lifecycle investment at Jafurah. Production at the field is expected to reach up to two billion standard cubic feet per day (scfd) of sales gas, 418 million scfd of ethane, and around 630,000 barrels per day of gas liquids and condensates by 2030, according to Aramco.
At the end of last month, Saudi Energy Minister Prince Abdulaziz bin Salman said that Aramco had discovered two unconventional natural gas fields in the eastern part of the country.
