A major joint Saudi gas venture said yesterday it was determined to pursue exploration activities in the Saudi Empty Quarter despite a decision last week by France’s Total to quit because of disappointing results.
South Rub Al Khali (SRAK) said it remained cautiously optimistic about hydrocarbon discoveries in one of the most hostile terrains in the world and would remain committed to its exploration programme in the long term.
Chief Executive Officer Patrick Allman-Ward told Emirates Business that SRAK would also consider other business opportunities in Saudi Arabia even if its hunt for hydrocarbons in the Empty Quarter produced no results. “No... Total’s withdrawal will not affect our operations. The project will continue and the venture is determined to complete the remaining four wells of its exploration commitment,” he said in an interview.
“Different geologists have different views on the prospects of any acreage. While we are, of course, disappointed by the lack of commercial hydrocarbons found in the first three wells, elements of a working petroleum system have been proven to be present in this part of the South Rub Al Khali Basin. We therefore remain cautiously optimistic about the prospects of the SRAK concession, while recognising that it is a frontier area and that exploration is a risky business. We do not believe three wells is sufficient to test the full potential of acreage of this size.”
Total said last week it was withdrawing from SRAK nearly four years after it was formed to hunt for gas in the vast Empty Quarter within a massive Saudi investment plan aimed at meeting its fast-growing gas demand.
SRAK’s concession covers nearly 210,000 square kilometres, almost the size of the United Kingdom. Total had owned 30 per cent of the venture, while the Dutch Shell Group controlled 40 per cent and the rest was held by state-owned Saudi Aramco. Following Total’s pullout, its stake was shared by the remaining two partners, which now hold 50 per cent each.
Total cited disappointing results in the search for hydrocarbons following the testing of three drilled wells.
Saudi sources said Total’s decision would not affect its other interests in the Kingdom. “The joint venture is fully committed to a long-term presence in the Kingdom of Saudi Arabia to the mutual benefit of both parties,” Allman-Ward said.
“In the case that no commercial hydrocarbons are discovered within its contract areas in the South Rub Al Khali, the venture would be interested in considering other opportunities.”
Besides SRAK, other joint ventures are hunting for hydrocarbons in the Empty Quarter after winning separate bids within the so-called “Gas Initiative” that was launched nearly 10 years ago.
The plan had initially involved investments of more than $20 billion (Dh73.4bn) but it was then partitioned into separate parts.
Total posted a 14 per cent rise in fourth-quarter underlying profits. The fourth-biggest western major oil company said fourth-quarter adjusted net profit – which strips out one-off items and unrealised gains or losses related to changes in the value of inventories – was €3.11bn. This was ahead of an average forecast of €3.05bn. For the full year, Total said adjusted net profit fell three per cent to €12.20bn. (Reuters)
Follow Emirates 24|7 on Google News.