Saudi Aramco’s annual production of crude oil dropped 1.7% to 3.253 billion barrels (8.9 million barrels per day) in 2006 from 3.309 billion barrels in 2005 (9.1 million barrels per day), according to the company’s Annual Review for 2006.
|Aramco crude oil production. Click to enlarge. Source: Saudi Aramco|
Natural gas production increased 4.5%, however, from 7.871 billion SCF daily in 2005 to 8.224 billion SCF daily in 2006.
State-owned Saudi Aramco is the world’s largest oil company, and holder of the world’s largest crude oil reserves.
In the review, Aramco said that it currently has half a dozen major crude oil development projects underway at various stages that will increase its maximum crude oil production capability by some 3 million barrels per day—roughly 20% over its current maximum capability and 33% over its average daily production level in 2006.
Some of that capacity will offset natural decline, while the remainder will expand our maximum sustained production capability, which by the end of 2009 will reach 12 million bpd. We have also developed scenarios to increase that level, should market conditions warrant expansion.
Our slate of mega-projects also will enable us to maintain spare production capacity of 1.5 to 2 million bpd above forecast production.
The company said it achieved crude oil reserves replacement of 104% in 2006, adding 3.6 billion barrels and bringing the total to 259.9 billion barrels.
Matthew Simmons, founder of the energy investment bank Simmons & Co and former energy adviser to President Bush, for one has concluded that the Saudi oil reserves—which are absolutely essential to any scenarios of fulfilling future demand—are overstated and that production there may already have peaked. (Earlier post.)