Saudi Aramco plans to raise its sustainable production capacity to 12.3 million b/d by 2025 as the world's largest oil-exporting company accelerates plans to bring additional output to market to meet the needs of global consumers, its chief executive told reporters during an earnings call Aug. 14.
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"It is going come gradually in 2024. I mean limited increase but in 2025, we should go to 12.3 million b/d and in 2026, we should go to 12.7 million b/d before reaching 13 million b/d by 2027," CEO Amin Nasser said.
Saudi Arabia claims a current production capacity of around 12 million b/d but Platts Analytics estimates this at closer to 11.5 million b/d. The kingdom, alongside fellow OPEC producer UAE, holds virtually all of the world's remaining spare capacity.
The kingdom plans to bring on additional capacity in increments, with its Dammam field set to provide a further 75,000 b/d by 2024, and the offshore Marjan and Berri fields expected to add 300,000 b/d and 250,000 b/d, respectively, by 2025. The expansion of the Zuluf field is projected to add another 600,000 b/d by 2026, with the Safaniyah development also set to add 700,000 b/d by late 2027.
Saudi Aramco said in its second-quarter earnings statement earlier Aug. 14 that it raised its capital expenditure by 25% to $9.4 billion in the period, as it continues to invest in bringing additional supply to the market amid record-high prices.
The company is working on the basis of a total $40-50 billion in capex for 2022, with additional guidance for spending set to be announced in 2023.
The spending will be focused on "growth not only in oil and gas [but] hydrogen [and] crude-to-chemicals. So there's a lot of programs that we are working on so that would require a growth in our capital program year-on-year, until 2025 and then maybe hopefully it will stabilize later on," Nasser said.
Total average hydrocarbon production rose to 13.6 million b/d of oil equivalent in Q2, the company said.
Saudi Arabia pumped 10.77 million b/d in July, its highest level in more than two years, according to a Platts survey, published by S&P Global Commodity Insights in August. However, the output level was slightly under Saudi Arabia's July OPEC+ production quota of 10.83 million b/d.
At the last meeting of OPEC+ producers, the oil exporter bloc headed by Saudi Arabia and Russia, Riyadh's quota for August has been set at 11.004 million b/d.
The kingdom has only ever twice produced at this level, in November 2018 and April 2020, according to Platts OPEC survey records.
In the first instance, the kingdom pumped 11.01 million b/d to meet US requests for more crude following the reimposition of sanctions against Iran. In 2020, Saudi Arabia pumped to an all-time record high of 11.70 million b/d following the breakdown of talks between OPEC+ members until a fresh deal was forged in May of that year.
The company can bring on 12 million b/d of output whenever there is a call from the government to bring on significant additional supply to meet global demand, Nasser said.
"So our commitment is anytime that we've been asked to or we will be asked to go to our maximum sustained capacity which is currently 12 million b/d, we'll be able to bring it on stream quickly and sustain it. And I think whenever we are going to be tested, if there is a call from the government to ask us to go higher, we will be we are ready," he added.