Riyadh targets becoming fracking superpower

Halliburton says kingdom has ‘huge desire’ to be first to emulate US shale boom

Saudi Arabia is determined to become the first country apart from the US to implement large-scale commercial shale operations, according to US-based oil field services company Halliburton.

“There is a huge desire to be first,” says Richard Burgess, technical solutions manager at the firm.

Halliburton, which is one of the main contractors working on Saudi unconventional assets, says the government has shown willingness to devote significant resources to ramping up production from unconventional assets.

“Saudi Arabia is not strapped for cash,” says Burgess. “It doesn’t have the same incentive as the small operators we dealt with in the US. The kingdom is attacking it in the same way everyone wants to tackle it and it’s working. The rock is there and the hydrocarbons are there in both forms [liquid and gas].”

Riyadh is looking to use unconventional gas to replace oil in domestic power generation, allowing more of its oil to be exported.

It is looking to potentially develop unconventional production in the Northwest, the Empty Quarter desert and near the Ghawar oil field. State oil major Saudi Aramco has said it plans to produce as much as 200 million cubic feet a day (cf/d) of unconventional natural gas by 2018 to supply the Waad al-Shamal mining project and a power plant.

Lack of access to water is likely to be the biggest restricting factor to the kingdom’s push to achieve large-scale unconventional gas production, according to analysts.

Recent technological breakthroughs in the US have reduced the amount of water needed to carry out hydraulic fracturing, but it remains to be seen whether the technology will be financially viable in Saudi Arabia.

“They’re very interested in technology,” says Burgess, talking about senior Saudi government officials. “When we come to the table with something new, they’re very happy. They like to be first. They like to break new ground, and that’s been good for service companies.”