Russia’s Lukoil is negotiating a deal with Saudi Arabia to tap unconventional gas deposits in the Kingdom’s ‘Empty Quarter’ desert region, the company said
The previous search for conventional gas in the region a decade ago proved unsuccessful, with no commercially viable deposits discovered.
Sadad al-Husseini, a former senior executive at Saudi Aramco, said, “The assumptions of the initial gas exploration agreements do not exist anymore because in spite of a decade of exploration, no commercial gas discoveries have been made.
“Therefore the exploration programme could be redefined as a change to unconventional gas exploration with higher costs and new buy-back terms,” he added.
An anonymous spokesperson for Lukoil commented, “This is tight gas. The negotiations are under way. No details on deal and future production plans yet… we are hopeful and will continue evaluating drilling after signing a deal.”
The higher cost of extracting unconventional gas is not the only obstacle to production - scaling up and sustaining unconventional gas operations at a meaningful level of supply would also present major technical challenges, Husseini said.
Saudi Arabian oil minister Ali al-Naimi has estimated that the Kingdom has more than 600 trillion cubic feet (tcf) of unconventional gas reserves, more than double its proven conventional reserves.
The Empty Quarter is located in Rub’al-Khali, south-eastern Saudi Arabia.
