Aramco Receives Bids For Hawiyah Gas Plant Expansion, Targets Gas Supply Boost

Aramco plans to add 1.3bn cfd of capacity at Hawiyah, as part of a program to support an almost doubling of gas production capacity to 23bn cfd.

State petroleum firm Saudi Aramco has received bids from engineering companies for a planned 1.3bn cfd expansion of the Hawiyah gas processing plant, which handles non-associated gas from the giant Ghawar onshore oil field.

The companies submitting proposals are South Korea’s Samsung Engineering, Spain’s Tecnicas Reunidas, Taiwan’s CTCI, Italy’s Saipem, UK’s Petrofac, India’s Larsen & Toubro and a consortium of Hyundai Engineering and Hyundai Engineering & Construction, according to Reuters.

The Hawiyah gas processing plant came online in December 2001, with capacity to process 1.6bn cfd of raw gas, delivering 1.4bn cfd of sales gas and 170,000 b/d of condensate. Aramco expanded the plant in 2009 to raise processing capacity by 800mn cfd to 2.4bn cfd. Last year Aramco processed a record 12.0bn cfd of raw gas, up from 11.6bn cfd in 2015, to deliver 8.3bn cfd of sales gas. Capacity has more than doubled over the past 15 years (see chart).

Saudi Arabia’s medium-term National Transformation Program (NTP) calls for raw gas production to be increased to 17.8bn cfd by 2020. Aramco CEO Amin Nasser recently said that beyond 2020 the company aims to almost double gas production to 23bn cfd over the next 10 years (MEES, 14 July).

To support the gas output expansion, Aramco plans to bring three gas processing plants with a total 5.75bn cfd processing capacity online from 2016 to 2020. The first of these, the 2.5bn cfd Wasit plant, built to the north of Jubail on the Saudi Gulf coast, was started up in 2016 and is now at full capacity. Wasit processes non-associated gas from the offshore Arabiyah and Hasbah fields.

The 75mn cfd Midyan non-associated gas processing plant in the Tabuk region of northwestern Saudi Arabia is almost complete and is expected to begin delivering sales gas this year. Some of the gas is earmarked for burning at a 610MW integrated solar combined cycle power plant that state utility SEC is developing at Dhuba.

The 2.5bn cfd Fadhili processing plant, being built 30km west of Jubail industrial city, is scheduled to begin operations in 2019. Like Wasit it is expected to deliver 1.7bn cfd of sales gas. Fadhili’s raw gas will come from the offshore Hasbah Phase 2 development and the onshore Khursaniyah field.

GAS VS LIQUIDS

In its 2016 Annual Review Aramco says that increasing supplies of natural gas will help reduce domestic reliance on liquid fuels for power generation, freeing up liquids for exports and providing additional feedstocks for petrochemical industries to spur regional development.

Whether increased gas availability is contributing to reduced Saudi burning of liquids in power plants is a moot point. Certainly direct crude burning is declining: first half 2017 direct burn was 424,000 b/d, down 50,000 b/d on H1 2016. MEES forecasts that Saudi crude burning will average 445,000 b/d for 2017 as a whole.

However, increased Saudi burning of fuel oil in power plants appears currently to be canceling out any decline in crude burning. MEES estimates that Aramco is on track to provide 546,000 b/d of fuel oil to power generators in 2017, up 73,000 b/d on 2016 and 143,000 b/d on 2015. Add the fuel oil and crude volumes together and total Saudi oil burning for 2017 is on track to at least equal the 2015 record of 975,000 b/d (MEES, 18 August).

In the petchems sector, Aramco is adding to the pressure on its gas resources by expanding its own production capacity. Aramco and Japan’s Sumitomo, partners in the Petro Rabigh refining and petchems JV, are expanding the plant and bringing new units online this year. Central to the expansion is a hike from 95mn cfd to 125mn cfd in the capacity of the complex’s ethane cracker.

Meanwhile Aramco and US firm Dow Chemical recently started the last of the units at their giant Sadara JV petchems complex at Jubail. Sadara includes a mixed feed cracker for which Aramco is contracted to supply up to 85mn cfd of ethane and 53,000 b/d of naphtha.

Saudi Gas Output (Bn Cfd)

SOURCE: SAUDI ARAMCO.