Saudi Aramco has awarded contracts totaling $25 billion to expand its natural gas production, meeting expected increases in energy demand in Saudi Arabia. These contracts cover key projects in the Jafurah unconventional gas field and aim to strengthen production capacities to achieve national targets. The sale of numerous shares to foreign investors surely favored these new investments.
Phase two of the Jafurah development received sixteen contracts worth $12.4 billion. The field, which contains 229 trillion cubic feet of raw gas and 75 billion barrels of condensate, is central to Saudi Aramco’s expansion strategy. Meanwhile, fifteen contracts worth $8.8 billion were signed for phase three of the company’s gas master system expansion, which distributes gas to customers across the country.
Increased infrastructure and capacity
The projects include the addition of 23 drilling platforms for $2.4 billion and two directional drilling contracts totaling $612 million. Thirteen well tie-in contracts at Jafurah, worth $1.63 billion, have also been awarded between December 2022 and May 2024. These developments are aimed at expanding Saudi Aramco’s gas production capabilities, adding significant volumes of ethane, natural gas liquids (NGL) and condensate.
The Jafurah project is expected to start up in the third quarter of 2025, with a total investment of over $100 billion, targeting sales of 2 billion cubic feet per day (Bcf/d) by 2030. Saudi Aramco expects its gas sales to increase by at least 60% by 2030, compared to the 2021 baseline.
Compression and splitting projects
The contracts cover the construction of gas compression facilities and associated pipelines, as well as the expansion of the Jafurah gas plant with gas processing trains, utilities, sulfur and export facilities . They also include the construction of new natural gas liquids fractionation facilities from Riyas to Jubail, with fractionation trains, storage and export services to process NGL received from Jafurah.
Saudi Aramco CEO Amin Nasser said these contract awards show the company’s confidence in the future of gas as an important energy source and vital raw material for downstream industries. The projects are expected to increase the company’s capacity by 3.15 Bcf/d by 2028 and install 4,000 km of pipelines, as well as 17 gas compression trains.
These developments underscore Saudi Aramco’s commitment to meeting growing demand for natural gas and supporting the country’s energy goals. The current investments strengthen Saudi Aramco’s position as a global leader in the energy industry.
