Shell confirms Empty Quarter drilling extension

27 May 2008
The South Rub al-Khali (Srak) exploration company has confirmed it has been given a crucial 18-month extension from the Petroleum & Mineral Resources Ministry, allowing it to complete its seven-well drilling programme in the Empty Quarter.

The consortium has received approval from the ministry for an additional exploration period until 25 July 2010. It is understood to be the only extension granted to date (MEED 11:4:08).

Similar requests have been made by Sino Saudi Gas, a joint venture of China's Sinopec and Saudi Aramco; and EniRepSa, which includes Italy's Eni, Spain's Repsol and Aramco (MEED 16:11:07).

The exploration programme is an important element in Saudi plans to develop its gas resources, which in turn will allow greater industrial diversification.

Srak says it is currently drilling its fourth exploration well, Kidan-6, and will drill three more exploration wells before the 2010 deadline.

Srak, a 50:50 joint venture of Saudi Aramco and the UK/Dutch Shell Group, asked Riyadh for more time to drill in August 2007, blaming terrorist activities in the kingdom in 2004 for putting its exploration activities behind schedule (MEED 24:8:07).

Under the terms of the original agreement, Srak's contract with the ministry was due to expire in January 2009. However, because progress has been slower than expected, only four wells from the seven-well commitment were likely to be completed before the venture was wound up.

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