Zuluf Expansion

Zuluf Oil Field Expansion Project Profile

Location and Overview

The Zuluf Oil Field is located in the Arabian Gulf, approximately 40km offshore the north-east coast of Saudi Arabia, or about 240km north of Dhahran. It is a super-giant oil field situated in shallow water, with a depth of around 36-40 meters.

Ownership and Operation

The Zuluf Oil Field is owned and operated by Saudi Aramco, Saudi Arabia’s state-owned oil company.

History and Discovery

The field was discovered in 1965 and began production in 1973. It has been a significant contributor to Saudi Arabia's oil production since its inception.

Reserves and Production

The Zuluf field has substantial reserves, estimated to be over 31 billion barrels of oil-equivalent (boe) in proven reserves. The field is known for its shale sandstone reservoirs, particularly the Khafji reservoirs from the late Jurassic era.

Currently, the field produces 800,000 barrels per day (bpd) of Arabian Medium crude oil. The expansion project aims to increase this capacity to 1.4 million barrels per day (Mbpd) of Arabian Heavy crude oil.

Expansion Project Details

The expansion project, which began in January 2018, includes several key components:

• Offshore Infrastructure:

  • Installation of a single well observation platform and three gas observation platforms.
  • Development of the fourth offshore gas oil separation plant (GOSP-4).
  • Installation of nine slipover jackets and decks.
  • Laying of subsea pipelines and cables.

• Onshore Facilities:

  • Construction of new onshore central processing facilities, including a new two-train GOSP to process Arabian Heavy crude oil.
  • Installation of gas compression facilities, a new water injection facility, and associated pipelines.
  • New downstream pipelines to transport the crude oil to the Ju’aymah terminal and the separated gas and condensate to the Tanajib gas plant.

• Modernization and Replacement:

  • Replacement of old electrical systems and mechanical equipment, including tower cranes.
  • Renovation and modernization of existing platforms to extend their operational life.

Contractors Involved

Several contractors are involved in the expansion project:

• Saipem: Providing engineering, procurement, installation, and construction (EPIC) services for the subsea systems, platform decks, and jackets. Also responsible for maintenance and dismantling works on existing platforms.
• Jacobs Engineering: Awarded the contract for engineering and project management services for the new onshore central processing facilities in March 2018.
• McDermott: Received EPCI contracts for relocating control rooms in GOSP-4 and for building a single observation platform and new platform jackets.
• Subsea 7 and L&T Hydrocarbon Engineering (LTHE): Awarded an EPCI contract for three oil production deck manifolds and subsea pipelines.
• National Petroleum Construction Company (NPCC): Supplying nine jackets for the expansion.
• Ramboll: Assisted with the replacement of tower cranes under a subcontract with WorleyParsons.

Project Timeline and Status

The expansion project was expected to be completed by 2020, but recent updates suggest that while some plans have been adjusted, projects that had already reached the Final Investment Decision (FID) stage, including the Zuluf expansion, will continue as planned.

Environmental and Sustainability Impact

The expansion is part of Saudi Arabia's Vision 2030 to improve energy sustainability. However, it has also been highlighted as a significant contributor to new oil and gas production and associated carbon emissions, making Saudi Aramco one of the largest contributors to new oil and gas supply in 2022.

Economic and Strategic Significance

The Zuluf Oil Field expansion is crucial for maintaining Saudi Aramco's spare oil production capacity and strengthening its position in the global oil market. The project is part of a larger investment plan by Saudi Aramco, which includes over $300 billion in the coming decade to maintain and enhance its oil and gas production capabilities.