Saudi ministry launches tender for dry gas network in Dammam

RIYADH: The Saudi Ministry of Energy announced a public tender for a licence to establish, own and operate a dry gas network in the Third Industrial City in Dammam in the eastern province, Arab News reported.

The project includes a pipeline network from the connection point with Aramco, which provides dry gas, to all factories that need fuel within the region, the ministry said in a statement.

The licence requires the design, construction, operation and maintenance of the dry gas local network in Dammam 3 at the expense of the licence applicant for a period of 35 years in return for a service tariff approved by the ministry.

The licence holder must meet 75 per cent of requests in the industrial city within nine months from the date of granting the licence, the ministry said.

Through the installation of the gas networks, the ministry is aiming to make Saudi Arabia’s industrial cities a more attractive environment for investors, to raise the efficiency and competitiveness of factories, and to reduce carbon emissions and the number of trucks that transport liquid fuels, it said.

Saudi Arabia is increasing its use of natural gas and renewables in power generation with a goal of a achieving a 50/50 split between the two by 2030.

Saudi Aramco is preparing to restart development of the giant Jafurah gas field in the eastern region of the country with plans to invest about $110 billion in the project, CNBC Arabiya reported in September.

The largest natural gas field in the Kingdom, stretching 170 km by 100 km, is estimated at 200 trillion cubic feet of rich raw gas.

Aramco has resubmitted several tenders for field development, including for the construction of the field’s dedicated power plant early next December, unnamed sources in the oil and gas industry told CNBC.

The Jafurah field will place Saudi Arabia third in the world in natural gas production by 2030, the Ministry of Energy has said.

Aramco expects the production from the Jafurah field to commence in early 2024 and reach about 2.2 billion cubic feet of gas/day by 2036. The field will also be able to produce about 425 million cubic feet of ethane/day, and around 550 thousand barrels/day of gas liquids and condensates.