Petrochemical projects are expected to drive the commencement of upcoming projects across the oil and gas value chain in Saudi Arabia, accounting for 61 per cent of the total projects expected to start operations by 2025, according to GlobalData, a leading data and analytics company.
Among these, new build projects dominate with 84%, while the rest are expansion projects, stated GlobalData in its report, Middle East Oil and Gas Projects Outlook to 2025 - Development Stage, Capacity, Capex and Contractor Details of All New Build and Expansion Projects.
The report reveals that petrochemical projects will be the highest with 50, followed by midstream with 18, refinery at eight, and upstream (fields) at six.
GlobalData pointed out that among the upcoming petrochemical projects in the kingdom, the Saudi Aramco Total Refining and Petrochemical Company's Al Jubail Ethylene Plant is a major project with a capacity of 1.5 mtpa.
The $1.6 billion plant provides feed stock to other petchem and speciality companies in the Jubail industrial city.
Soorya Tejomoortula, Oil & Gas Analyst at GlobalData, said: "Saudi Arabia’s aggressive investments in the petrochemicals sector is part of its 2030 vision plan, where the country aims to reduce its dependence on the upstream sector and diversify into other segments."
"The state-owned company, Saudi Aramco, already acquired 70% stake in the country’s petrochemical giant, Saudi Basic Industries (Sabic), last year for approximately $69 billion as part of its strategy to diversify from the upstream sector," said Tejomoortula.
According to GlobalData, 18 midstream projects are expected to start operations in Saudi Arabia during 2021 to 2025 period.
Some of the key midstream projects expected to start operations by 2025 include the Tanajib gas processing plant with a capacity of 2.8 billion cu ft per day and a project cost of $3.5 billion and Hawiyah Unayzah underground gas storage site costing $2.1 billion.
The gas processing plant is part of expansion of the Tanajib oil project, while Hawiyah Unayzah underground gas storage site helps to meet seasonal variations in gas demand in the country.
Tejomoortula said: "In the upstream (fields) segment, Jafurah is a key upstream production project, which is set to begin operations with a total production capacity of 916.7 thousand barrels of oil equivalent per day."
"The project, considered as the largest unconventional gas development in Saudi Arabia, will provide additional gas for domestic consumption and valuable feedstock to petchem projects," he added.
