Oil & Gas

Saudi Arabia's state oil giant Aramco, having abandoned plans to expand oil capacity earlier this year, is now set to increase its natural gas output by 60% by 2030, according to Reuters. This information comes from an Aramco executive speaking at the Houston CERAWeek energy conference.

In the third quarter of last year, Saudi Arabia made significant natural gas discoveries in two fields in the Empty Quarter and found five reservoirs in previously explored fields. Gas flowed at a rate of 30 million cubic feet daily at the Al-Hiran field and 0.85 million cubic feet daily at the Al-Mahakik field.

With global energy transition driving significant gas demand growth, Saudi Arabia is hastening the development of unconventional gas fields. LNG demand is expected to increase by 50% by 2030. Saudi Arabia's interest in natural gas has led to its first acquisition in the LNG sector this year.

Recent reports suggest that Aramco and Abu Dhabi National Oil Company (ADNOC) are considering investing in American LNG to compete with Qatar, which lost its position as the world's largest LNG exporter to the U.S. in January. Aramco is reportedly discussing the Sempra Infrastructure Port Arthur LNG Phase 2 project in Texas, with Phase 1 already operational and Phase 2 proposed for expansion.

Saudi Arabia's efforts to expand natural gas production and its growing interest in global LNG markets coincide with the Biden Administration's pause in approving new LNG projects, adding uncertainty to financing for American LNG ventures.