LNG

Saipem, the Italian LNG and energy engineering company, has completed the South Gas Compression Plant Pipelines project to increase the life of a substantial number of natural gas wells in the Haradh and Hawiyah fields in Saudi Arabia.

The Saudi Arabian Oil Company (Saudi Aramco) project is aimed at reducing the use of oil and increasing the use of natural gas as the primary fuel for several local industries.

Saipem, based in Milan, said the scope of work encompassed the procurement and construction of a system of pipelines of various diameters, with an overall length of over 700 kilometres (435 miles).

The venture additionally included flowlines, trunklines, and transmission lines, as well as associated facilities for the transportation of gas from various points of storage and distribution inside the facilities, such as liquid station separations, remote headers, gas gathering manifolds and off plot tie-in facilities.

Challenges

“The project presented challenges from a logistics, safety, security and project management point of view,” stated Saipem.

Dhahran-based Aramco has said that increasing natural gas output was a strategic priority and the company had successfully advanced multiple gas projects in 2023.

The Haradh and Hawiyah fields for associated gas are key projects.

Aramco’s Hawiyah Gas Plant expansion is part of the Haradh gas increment programme.

Construction at the Hawiyah Unayzah Gas Reservoir Storage, the first underground natural gas storage project in the Kingdom, has also been completed and injection activities commenced.

Aramco made two large natural gas field discoveries in November 2023 while additionally starting output in a Saudi shale gas basin called South Ghawar.

The two Saudi natural gas field discoveries were made in the Eastern Province and the Empty Quarter regions respectively.

Saudi shale gas

Analysts said that the discovery of more natural gas reservoirs is expected to further Aramco’s strategic plans to increase gas production by over 50 percent with the aim of meeting all domestic demand by 2030.

Earlier in November Aramco announced that it had begun production of unconventional tight gas from its South Ghawar operational area, two months ahead of schedule.

Unconventional tight gas, also known as shale gas, is typically found in reserves where hydrocarbons are tightly trapped within rock layers.

Extracting this gas demands specialised techniques like horizontal drilling and hydraulic fracturing for extraction.

The commissioned facilities at South Ghawar currently have a processing capacity of 300 million standard cubic feet per day of raw gas and 38,000 barrels per day for condensate.

Saudi Energy Minister Prince Abdulaziz bin Salman said Saudi Arabian Oil Co., known as Saudi Aramco, has made two large natural gas field discoveries after recently also entering the LNG sector while additionally starting output in a Saudi shale gas basin called South Ghawar.

Saipem, the Italian energy and LNG engineering company specialising in subsea and oil and gas development projects and pipelines, posted soaring third-quarter revenues of more than €3 billion ($3.2Bln) as global demand surged.

Saipem said revenues to the end of September 2023 amounted to €3.02Bln compared with €2.85Bln in the same three months of 2022.

Quarterly gross earnings increased to €230 million versus €168M in the prior-year quarter. Net profits in the quarter came in at €39M versus a loss of €8M in the same quarter last year.

The Milan-based company said new contracts added to the backlog in the first nine months of 2023 amounted to €11.92Bln, an increase from the €6.92Bln in the corresponding period of 2022.

The backlog as of September 30, 2023 amounted to a total of €27.57Bln. These contracts comprised €15.08Bln in asset-based services, €10.33Bln in Energy Carriers and €2.15Bln in Offshore Drilling of which €2.69Bln was being completed in 2023.

LNG awards

Saipem won contracts earlier in 2023 with three linked to increased LNG production in Angola, Trinidad and Papua New Guinea.

“Group performance further improved with another quarter of growth in terms of revenues, margins, net result and cash generation, confirming the trend already recorded in the first six months of the year,” said Saipem.

“The improvement is recorded in the Offshore, Engineering and Construction and Drilling divisions,” Saipem added.

Saipem is also showing continued traction in the Middle East. After the close of the quarter, on October 5, Saipem, in consortium with National Petroleum Construction Company (NPCC), signed on behalf of Abu Dhabi National Oil Company a contract related to the Hail and Ghasha development project-package one in the United Arab Emirates.

Saipem said its share of the contract amounted to around $4.1Bln. The project is aimed at developing the resources of the Hail and Ghasha natural gas fields located offshore Abu Dhabi.

The project scope of work encompasses the engineering, procurement and construction (EPC) of four drilling centres and one processing plant to be built on artificial islands, as well as various offshore structures and more than 300 kilometres of subsea pipelines.

Adriatic FSRU

As part of the domestic Italian LNG build-out Saipem was awarded a contract by Italian gas system operator SNAM for the construction of the associated facilities for the new Floating Storage and Regasification Unit (FSRU) to be located in the Adriatic Sea offshore Ravenna as Italy’s fifth import terminal.

The contract, awarded jointly via a temporary venture with two other Italian companies Rosetti Marino and Micoperi, comprises the EPC and installation of a new offshore facility and for the docking and mooring of the FSRU.

The latest Italian floating terminal will be connected to shore via a 26-inch offshore pipeline of 8.5km length, plus a 2.6 km onshore pipeline and a parallel fibre optic cable.

Saudi Arabian Oil Company (Aramco), the world’s largest seller of crude oil, reported that annual net income more than doubled to $110 billion and confirmed plans to boost natural gas output by 50 percent.

Saudi Arabian Oil Company (Aramco) has signed a $15.5 billion lease and leaseback deal involving its natural gas pipeline network with a consortium led by a unit of the US investment management firm BlackRock.

The World Bank said the six members of the Gulf Cooperation Council, including LNG exporters Qatar, Oman and the United Arab Emirates are bouncing back to positive growth from the double blow of Covid-19 and the energy slump, showing the economic resilience of oil and gas.