Saudi Aramco, the national oil company of Saudi Arabia, is proceeding with a plan announced last May to re-open oil production at its Dammam oil field. Dammam is the country’s oldest field discovered in 1938 and has been shut-in for about 30 years.
Saudi Aramco estimates that 500 million barrels of heavy oil remain in the field and believe production could reach 100,000 barrels/day. A total of 32 million barrels were produced at Dammam before it was closed. Saudi Arabia’s — and the world’s — largest field, Ghawar, has produced 65 billion barrels and is still active today.
This report is both positive and negative. On the positive side, even 100,000 new barrels/day is a good thing. On the negative side, if Saudi Aramco needs to re-open a long idled field to maintain its current production and spare capacity quantities, the oil situation in Saudi Arabia could be more tenuous than the country would like to have the rest of us believe.
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