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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: mishedlo who wrote (19787)	12/29/2004 1:55:29 AM
From: Raymond Duray	Read Replies (1) \| Respond to of 116555

SAUDI OIL NEWS: Re: Two days ago the saudis inaugurated the Qatif Producing Plants Projects, the largest project of it's kind in the world. But certainly not the largest field in the world. That would be Ghawar, which is currently estimated to be producing over 5 MMbblpd, about one half of total Saudi production. It is important to put Qatif in perspective: healthandenergy.com <COPY> The average decline rate in Saudi Aramco's mature fields — Ghawar and a few others — "is in the range of 8 percent per year," without additional remediation, according to the company's statement. This means several hundred thousand barrels of daily oil production would have to be added every year just to make up for the diminished output..... To offset its declines, Saudi Aramco is bringing back into production one idle field, Qatif, and is enhancing production at a nearby offshore field, Abu Safah. The company says that with expert management, these fields will produce about 800,000 barrels a day. But current and former Saudi Aramco executives question those expectations, contending that the goal of 500,000 barrels a day for Qatif is unrealistic and that development costs are higher than anticipated. Qatif poses real difficulties. It is near housing for Saudi Arabia's minority Shiite population and contains high concentrations of hydrogen sulfide, a highly toxic gas. Its development is "particularly challenging," according to a technical paper by Saudi Aramco engineers presented last year in Bahrain, which said that 45 percent of potential drilling sites "were rejected due to safety concerns." At Abu Safah, Saudi Aramco has experienced increasing water problems as it has turned to submersible pumps to extract oil. Experts, including American and Saudi government officials, say the technique is ill advised. <END COPY> The breathless and cheerful announcement that you posted from Yahoo seems to be very light on facts.