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Saudi Aramco Expands its Gas Sector with $25bn Contract Awards

Saudi Aramco has on Sunday awarded contracts, at a total value of over $25bn, to advance its strategic gas expansion which aims to increase gas production by more than 60% by 2030.

In a statement, Aramco revealed that the contracts are related to the second phase of Jafurah gas field development, the third phase of expanding its Master Gas System, new gas rigs and ongoing capacity maintenance.

Contracts Significance

Aramco President and CEO, Amin H. Nasser, highlighted the momentum in Saudi Aramco’s projects and capital investments as part of its growth strategy, which is positively reflected in the dynamism and sustainability of energy industry in the Kingdom.

He said: “These contract awards demonstrate our firm belief in the future of gas as an important energy source, as well as a vital feedstock for downstream industries.

“The scale of our ongoing investment at Jafurah and the expansion of our Master Gas System underscores our intention to further integrate and grow our gas business to meet anticipated rising demand.”

Economic Benefits

Nasser stressed the expansion of gas sector is vital for Aramco’s growth. “This complements the diversification of our portfolio, creates new employment opportunities, and supports the Kingdom’s transition towards a lower-emission power grid, in which gas and renewables gradually displace liquids-based power generation,” he said.

Saudi Aramco Expands its Gas Sector with $25bn Contract Awards

“To get where we are today, a lot of hard work, innovation and a strong ‘can do’ spirit has been demonstrated by teams across our vast network of suppliers and service providers, who have joined Aramco on this journey to build and expand our world-class energy infrastructure,” Nasser added.

Moreover, Nasser appreciated the unwavering support provided by the Saudi Minister of Energy, Prince Abdulaziz bin Salman bin Abdulaziz, for the Kingdom’s energy industry to transform it into a global model for growth, reliability, development and diversity, the Saudi Press Agency (SPA) reported.

Aramco’s Contracts

According to the company’s statement, Aramco has awarded 16 contracts, with a total value of around $12.4bn for the second phase of Jafurah development. The work will include establishing gas compression facilities and associated pipelines, and expanding the Jafurah Gas Plant by constructing gas processing trains, and utilities, sulfur and export facilities.

Moreover, it will involve construction of the Aramco’s new Riyas Natural Gas Liquids (NGL) fractionation facilities in Jubail, to process NGL received from Jafurah.

Saudi Aramco Expands its Gas Sector with $25bn Contracts Awards

Furthermore, the Company has awarded 15 lump sum turnkey contracts, worth a total of about $8.8bn. These contracts aim to embark on the third phase of expanding the Master Gas System, which provides gas to customers across Saudi Arabia.

In collaboration with the Saudi Ministry of Energy, this expansion will increase the network size and total capacity by 3.15bn standard cubic feet per day (bscfd) by 2028. This will be achieved through installing around 4,000 km of pipelines and 17 new gas compression trains.

Additionally, Aramco has awarded another 23 gas rig contracts at a value of $2.4bn along with two directional drilling contracts worth $612mn. In the meantime, the Company has awarded 13 well tie-in contracts at Jafurah, valued at $1.63bn, in the period between December 2022 and May 2024.

Jafurah Gas Field

The Saudi oil giant estimates that the Jafurah unconventional gas field contains 229 trillion standard cubic feet of raw gas and 75 billion Stock Tank Barrels of condensate. The first phase of the Jafurah development program started in November 2021, and is progressing on schedule with initial start-up anticipated in the third quarter of 2025.

Saudi Aramco Expands its Gas Sector with $25bn Contract Awards

Aramco anticipates total overall lifecycle investment at Jafurah to exceed $100bn and reaching a sustainable sales gas production of two billion standard cubic feet per day by 2030, alongside significant volumes of ethane, NGLs, and condensate.

Master Gas System

Through a vast network of pipelines, Aramco’s Master Gas System connects the Company’s key gas production and processing sites across the Kingdom.

Its expansion will increase customers’ access to domestic gas supplies. This will provide a lower greenhouse gas emission alternative to oil for power generation.

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