By Reem Shamseddine
Government's initial estimates show that gas can be developed commercially.
Saudi Arabia on Tuesday reported finding new gas in the northern Jalamid area, which it said could be commercially exploited.Tests showed the Jalamid 3 discovery well in al Sannara reservoir flowing at 12.1 million cubic feet per day (cfd), the official SPA news agency said, citing Petroleum and Mining Minister Ali al Naimi.
Naimi said: "Initial estimates show that the gas can be exploited commercially," adding that the well was drilled to a depth of 9,795 feet (2,986 metres).
Naimi added: "This well can produce greater quantities under normal production conditions."
He also said the gas field would be developed.
Saudi Arabia has been stepping up its search for gas to cater for a demand that is growing 7 percent annually after an oil price rally between 2002 and 2008 fuelled the creation of more power and industrial projects.
The kingdom is expected to start producing 450 million cfd of gas from the first phase of the Karan gas project by mid-2011, state oil giant Aramco said last year.
As most Saudi gas is produced in association with oil output, volumes fluctuate with oil production. Saudi oil output is at one of its lowest levels since the most recent oil boom began as the kingdom and OPEC curb output to match falling demand. This has left gas supply in the kingdom tight.
Aramco has said that it plans to raise its daily gas supplies by 30 percent within five years to 8 billion cubic feet.
The kingdom plans to build the largest ever gas plant in the kingdom expected to process more than 1.8 billion cubic feet per day of gas to supply utilities and some industries. (Reuters)For all the latest energy and oil news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.