Saudi Seen Selecting Gas Consortium Leaders In March
The Saudi Arabian committee negotiating with international oil companies for investment in the country's gas sector is expected to named the consortium leaders for new E & P ventures shortly around mid-March after the Islamic holidays, the MEES reported Monday.
MEES reported that the companies short listed are:
On core venture No. 1 - the South Ghawar Area Development, now lists - Royal Dutch Shell , BP Amoco , Exxon Mobil , Chevron , TotalfinaElf and ENI SpA .
On core venture No. 2 - the Red Sea Development - now lists Enron Corp. and Occidental Petroleum Corp. bidding jointly, Exxon Mobil, TotalfinaElf, Marathon Oil Canada Inc. , Shell and Conoco Inc.
Core venture No.3 - the Shaybah Area - lists TotalfinaElf, Conoco, Phillips Petroleum (P), Enron/Oxy, Exxon Mobil Corp., Shell and Marathon Oil.
All three ventures have been estimated around $25 billions
Once consortium leaders are appointed, they will direct negotiations on behalf of the rest of the group on details such as exact project definition, pricing and financing.
The MEES report Monday said Saudi Arabia intends to proceed with ventures No.2 and No.3 before No.1, aiming to sign memoranda of understanding for the two by the end of March.
"Core venture No.1 is the most complex. The others are more geographically focused," said the source, offering one reason as to why the Saudis may choose to progress with the simpler projects first.
Among other things, the South Ghawar project involves developing gas in the east of the country and piping it west. Saudi Arabia invited international oil companies over two years ago to participate in proposals for downstream gas projects and upstream gas enhancement.
The process has gained increased momentum in the past year. And despite the fact that a comprehensive framework for the initiative hasn't been announced, at least some projects are expected to get off the ground next year, according to local analysts.
© 2001 Mena Report (www.menareport.com)