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OPEC's de facto leader and the world's largest oil exporter Saudi Arabia has officially joined the ranks of the world's expanding club of exponents of liquefied natural gas (LNG). Amin Nasser, director of Saudi Aramco's state-owned company, said on Thursday that the company was in discussion with many partners around the world regarding potential joint ventures in the gas sector and that it had sold its first LNG cargo, apparently from Singapore, the hub of the Asia-Pacific region, which accounts for two-thirds of global LNG demand.
The oil giant has repeatedly indicated that it is interested in gas for both export and domestic use. Riyadh also recently announced that it plans to produce 10% of its electricity from renewable sources over the next five to six years in order to diversify its energy mix and release more crude oil for export. Saudi Arabia still uses mainly crude oil for electricity generation. However, if the Kingdom used both natural gas (the cleanest hydrocarbon to burn as well as renewable energy, solar and wind), it could release more oil for export, between 300,000 and 1 billion. million barrels a day, numbers that you use.
Solar promises
On the solar front, however, the Kingdom speaks a bigger game than it actually does, at least up to now. In recent years, Riyadh has committed to becoming one of the world's leading producers of solar energy by investing some $ 350 billion in solar infrastructure. In March, Saudi Crown Prince Mohammed bin Salman announced the signing of a $ 200 billion deal with Japan's SoftBank Group Corp. to build enough solar capacity to triple Saudi Arabia's current electricity production.
Renewable energies, especially solar energy, are also part of the Crown Prince 's vision of revolutionizing the Saudi economy, both in terms of modernization and the fight against excessive dependence on solar energy. crude oil. Riyadh is currently developing about 30 solar and wind projects for 9.5 GW of renewable energy by 2023, as well as a construction project of a 17.6 GW nuclear capacity. from here 2032. Related: This country will be critical for the future of the oil industry
However, according to media reports in the region, project construction has hardly begun. Similarly, Fatih Birol, executive director of the International Energy Agency (IEA), said in December that the Saudis were putting a lot of effort into promoting renewable energy.
Gas ambitions
Saudi Aramco plans to increase its gas production from 14 billion cubic feet per day to 23 billion standard cubic feet a day, Nasser said at a chemical industry event in Washington. Dubai at the end of last year. "Our gas program … will attract about $ 150 billion in investment over the next decade," he said. "We also have world-class unconventional gas resources that quickly complement our vast conventional resources …. We seek to stop satisfying only our utilities sector in the kingdom, which will occur especially with the increase in renewable and nuclear energy, to become an exporter of gas and gas-based products. "
Saudi Arabia is also interested in a significant share (about 30%) of the vast project proposed by Russia, Arctic LNG 2. The consequences of a possible Saudi investment in the project could bring Saudi Arabia to resell cargoes in the secondary market (spot), to enter into medium and long-term supply contracts or to use them simply for domestic purposes.
A gas agreement between Saudi Arabia and Russia will also strengthen its growing stake in the OPEC + oil producers group, which is currently drying up the excess oil supply as part of the its second oil production agreement in just three years. In January, Nasser told Reuters in an interview that Saudi Aramco was also seeking to spend billions of dollars on natural gas acquisitions in the United States, as part of the state-owned oil company's strategy. , aiming to strengthen its gas business and become a global gas player.
By Tim Daiss for Oilprice.com
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