State-owned Saudi Aramco plans to develop its domestic shale gas reserves with a view to beginning production in 2020.

Ebrahim Assa’adan, Aramco’s general manager of exploration, told reporters in Riyadh that gas shale production would be needed by the end of the decade to fuel booming domestic demand.

Aramco has started initial studies into gas shale and a series of seismic surveys. The drilling of exploration wells are also planned by the state-owned.

Gas shale is popular in other countries such as the US, but it is expensive to produce compared with other gas sources at the kingdom’s disposal. US shale gas costs $5-6 a million BTUs to extract and usually comprises methane, ethane and natural gas liquids (NGLs) (MEED 21:10:11).

This does not compare favourably with the current price the kingdom sells its gas at to industrial sources of $0.75 a million BTUs.