Saudi Aramco's Wa'ad Al Shamal mining and industrial project in northern Saudi Arabia was inaugurated on Thursday by King Salman bin Abdulaziz Al Saud, Saudi Aramco announced.
The project marks a major milestone in Saudi Aramco's long-term strategy to increase gas supplies in support of the Kingdom's economic diversification program to generate growth in new sectors, according to a statement from the company.
Spread over 440 square kilometers, and already hosting phosphate processing facilities Wa'ad Al Shamal, or "Northern Promise" will be a new industrial city located 30 kilometers west of Turaif, which is set to become a major mining hub, it said.
By developing new mining and mineral activities, especially phosphates, and downstream value-added industries such as glass and plastic manufacturing, it is estimated that Wa'ad Al Shamal will generate SR24 billion ($6.4 billion) from non-oil sectors and contribute 3 percent to the Kingdom’s Gross Domestic Product.
Saudi Aramco President and CEO Amin H. Nasser said the project could be "a prime catalyst" in creating transformational industries that can generate more growth and more value from niche manufacturing sectors such as manufacturing glass, glass fibers, plastics and solar panels.
According to the statement, Saudi Aramco commenced commercial production of unconventional gas in the North Arabia Field in May 2018, supplying approximately 55 million standard cubic feet per day (MMscfd) to a local power plant. The gas production will ramp up to 190 MMscfd toward the end of 2018 to meet customers’ needs.
Nasser added: "What we see now at Wa'ad Al Shamal city is the productive outcome of close collaboration between government sectors, agencies and leading national companies. I am proud of Saudi Aramco's role in this achievement, making an investment of more than SR 10 billion ($2.66 billion) to supply the required energy feedstock to the city and its projects."
Commercial production of natural gas signifies the first milestone in Saudi Aramco's implementation phase of the unconventional resources extraction program, according to the press release.
"The gas supply to support Wa'ad Al Shamal industrial projects will also help offset the increase in liquid burning for electricity in the area," added Khalid M. Al Abdulqader, Saudi Aramco's general manager of Unconventional Resources.
According to the statement, producing unconventional gas near Turaif will replace the burning of hydrocarbons for electricity generation, resulting in a reduction in carbon emissions while saving hydrocarbons for export to obtain higher value.
"Thanks to world-leading, cutting-edge technology, Saudi Aramco is able to increase the chances of finding gas, while reducing the drilling and well delivery time, as well as costs, by 70 percent," it said.
By Hale Turkes