Saudi Arabia: Market dictates production

[maddezmom]

Source: AP

Saudi Arabia: Market dictates production 4 minutes ago



RIYADH, Saudi Arabia - Saudi Arabia will raise oil production only when the market justifies it, the kingdom's oil minister said Tuesday, in response to President Bush's request that OPEC nations increase output to reduce world oil prices.

"Our interest is to keep oil supplies matching demand with minimum volatility in the oil market," Oil Minister Ali Naimi told reporters. "We will raise production when the market justifies it. This is our policy."

Naimi said inventory levels appear to be "normal," adding, "we want the inventories to be healthful, but we don't want it to be extremely high or extremely low."

Earlier Tuesday in Riyadh, Bush warned that soaring oil prices could cause an economic slowdown in the United States.

"High energy prices can damage consuming economies," the president told a small group of reporters traveling with him in the Mideast.




Read more: http://news.yahoo.com/s/ap/20080115/ap_on_re_mi_ea/saudi_oil

[saigon68]

1. Looks like the sheik is taking his chips

And leaving the game to the amateurs

[lapfog_1]

2. He failed to add

that there ISN'T anything they could do about even if they wanted to.

They are pumping all that they can now. At this point, new wells drilled only decrease the production from other wells in the same field. And they have to use water injection methods now to keep current production levels.

When that fails to keep the oil flowing... $100 oil will seem like a pleasant dream.

[TransitJohn]

3. Well

I'm a petroleum geologist working in Saudi Arabia right now...and that's not what I see when I'm at work. Where do you get your info?

[ixion]

7. what do you see?

just curious...

[TransitJohn]

10. Infilled wells

(which are between previously sunk wells in a field) do not decrease the flow rates of existing wells. The pore pressure of the fields here is amazing..these wells flow.

[Tandalayo_Scheisskopf]

8. Yes, John, please let us know...

What you see on the ground in SA. I have long held a few suspicions about the peak oil meme being injected into western society during this administration, in light of everything else they have been up to.

Not discounting, just suspicious.

[TransitJohn]

9. This is my 3rd hitch over here

and all 3 times the wells we've sunk are wildcatters. The cores we've pulled are just dripping with crude....there's plenty of oil here. I'm going offshore in the Persian Gulf in 2 days to spud a well in that field, also a wildcat. Aramco sinks tens of millions into their wildcatters, and you just don't spend that money on a well if it's not gonna be pay.

[Texifornia]

12. I've been there too...

Worked on water injection in Uthmaniyah, production in Jauf, and gas wells and gas plants in Hawiyah, Haradh, Qatif and others. I've also done some work at Ras Tanura.

I don't see the new production coming from infill wells replacing the depletion in the north of Gawair AND increasing the Kingdom's production to the projected 20 to 22 MMBBD. We've been injecting the north of Gawair hard for at least 15 years and I don't think Aramco's total production can even get to 18 MMBPD.

I don't doubt you on the wildcat well paying off, I just don't think it is enough to offset the depletion.

One thing about Aramco, they won't spoil the fields like PEMEX did with Cantarell. The will not overproduce if it endangers future production.

[TransitJohn]

13. Ok

First of all, :hi:.

Like I said, I'm a noob in this place, my career previously has focused closer to home in Wyoming, previously venturing to the Oklahoma panhandle, western slope of Colorado, and the Uintah Basin in Utah. The 2 wells I've sunk so far have been way south of Hofuf, towards the empty quarter, approximately 200-250 klicks south-southwest. So, it's what I've seen. I was honestly not aware of the water injection up there...it's not like Aramco will give a lowly contract wellsite geologist any valuable info about the fields he's working. :eyes: It's hard enough to just get offset well logs.

And they most definitely won't spoil like PEMEX, these guys are pros...they're all about maximizing profit.

[Texifornia]

14. Cool

I understand what you're saying. My work in the south has been in the gas fields, both at the wellhead and at the GPPs.

I was also involved in the Ras Laffan project in Abu Dhabi and with the gas fields in Qatar. I'm no geologist, but I design wellhead equipment and have looked at the new wellhead data from almost all of the world for the last five or six years by virtue of the fact that I design and spec. wellhead equipment.

Anyhow, you are right about Aramco keeping tight lipped about production data. I sense that they are trying to establish what they call their "maximum sustainable production". Of course nobody outside of the Oil Ministry and the Royal Family know that number. It's the same in the U.A.E. I was once on Dubai's Fateh platform trying to solve an injection problem and they were not allowed to give me flowing wellhead data. It was instant termination for anyone to give those production rates. It made it hard to solve the problem. The guy the Emir of Dubai most wanted to keep the production numbers from? His cousin the Emir of Abu Dhabi.

...so it goes in the Gulf.

[lapfog_1]

11. There are a number of petroleum websites

like this one.

http://www.gregcroft.com/ghawar.ivnu

has some interesting information... note that to maintain pressure at the well head, injection wells are needed in their largest oil field, Ghawar. Which is indicative of production saturation.

As for reserves, the Saudis took over this function (publishing their reserve estimates) in the 1980s... and it this point, I don't trust any numbers the Saudi government publishes.

[izzie]

5. besides that most of our oil comes from other places.

OPEC just keeps the price as they wish. By the way I thought Bush was going to talk to SA for the last 8 years. Didn't he say some thing like that when he was running? That is a joke as he has done little of what he said he would do and done a lot of harm we have hardly heard about alone with his war business..

[TransitJohn]

6. Yeah I seem to recall

something about "jawboning" and "opening spigots." What a laugh.

[notadmblnd]

4. Looks like bushes extended family didn't take the deal

what was it again 20 billion in weapons just to have his surrogate daddy slap his little face?

Besides I thought the excuse for high gas prices here in the US was not for a lack of crude, but because our refineries were not putting out due to various convenient mishaps?