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A new shale gas revolution – Saudi Aramco

To boost domestic gas supply and end the burning of oil at its power generation plants, Saudi Aramco is launching the biggest shale gas development outside of the United States, Chief Executive Officer Amin Nasser declared on Monday.

The world’s top crude oil exporter has for years battled for market share with rapidly expanding shale oil producers in the United States, which in just a decade have developed capacity to pump millions of barrels per day of oil from rock formations that were previously too costly to tap.

Following this new technology, Saudi Arabia would become the world’s third largest gas producer by 2030. The world’s top two gas producers are the United States and Russia.

Aramco had developed fracking using seawater, which will remove the obstacle that a lack of water supply represents to fracking in the desert, Nasser stated.

“A new shale revolution is taking place (in Saudi Arabia), it’s commercial and we are using seawater,” in the fracking process, Nasser said in an interview in Saudi Arabia’s oil-producing Eastern Province.

The Saudi state oil group has worked with international oil service companies to develop the technology to fracture the rock and release the oil and gas it holds, a technology known as fracking. Those firms are active in U.S. shale fields.

“A lot of people said it doesn’t work outside the U.S…. because fracking uses a lot of water and we are not rich with water. But we are using seawater.”

Outside the United States, oil firms have had limited success developing shale reserves for a variety of reasons- either due to lack of expertise, a scarcity of water or other resources, lack of infrastructure, or proximity to large population centers.

The process requires pumping water, sand and chemicals into the fields at high pressure.

Aramco has drilled 150 wells since 2013 in the Jafurah shale gas field to prepare the development plan, he said.

The development may also position Saudi Arabia as a gas exporter, Nasser said. The preference for exports would be through pipelines to nearby countries rather than developing costly liquefied natural gas export terminals, he added.

Nasser said the company has other similar projects under consideration.

“We just started on the non-conventional.”

Saudi Arabia’s Crown Prince Mohammed bin Salman issued an order on Friday for Jafurah’s gas to be used primarily by domestic industries such as petrochemicals to support the kingdom’s Vision 2030 development plan, the prince’s economic reform strategy to diversify away from oil.