Saudi starts production at new oil field in weeks

PRODUCTION BOOM: Khurais is the largest of three new oilfield projects. (Getty Images)

Saudi Arabia, the world's top oil exporter, will start production at its 1.2 million barrels per day (bdp) Khurais oilfield in a few weeks, state oil firm Aramco said on Friday.

Khurais is the largest of three oilfield projects that would take Saudi total production capacity to 12.5 million barrels per day (bpd) by the end of June.

Although it will not immediately add to the sum of Saudi output it is the biggest ever single increment to global production. Its initial output was undisclosed.

"... Khurais, a Mega Project, which will add 1.2 million barrels per day of Arabian Light crude oil to the Company's output in a few weeks time," Aramco said in a statement.

The other two fields included in Aramco's programme are the 250,000 bpd Shaybah expansion, which would take capacity at that oilfield to 750,000 bpd and the 100,000 bpd Nuayyim oilfield.

The kingdom has over a fifth of all the world's oil reserves but has no further plans to expand output capacity.

Spare capacity in June would grow to more than twice the 1.5 million to 2 million bpd cushion it likes to keep to meet any unexpected global production outages.

With so much spare capacity, Saudi Arabia is in no rush to develop more. The kingdom has outlined how it could take capacity to 15 million bpd when demand warrants further growth. (Reuters)

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