Saudi Arabia & KAUST - National US-Arab Chamber of Commerce

Chevron: Seven Decades
of Partnership
Chevron is the only large international
energy company with a continuous
upstream presence in Saudi Arabia that dates
back seven decades. Based in San Ramon,
California, Chevron is one of the world’s
leading integrated energy companies, with
62,000 employees and subsidiaries around
the world. The company is engaged in a wide
range of petroleum-related interests in the
Kingdom and works closely with Saudi Aramco,
as well as private firms.
In the early 1930s, Standard Oil
of California – later Chevron – first
began exploring for oil in the Eastern
Province of the Kingdom. By 1936,
The Texas Company – later Texaco
– became a partner with the
California Arabian Standard Oil
Company (CASOC). In November 1937,
after five years of drilling and $9 million spent
without any return on their investment,
CASOC ordered drilling to be halted everywhere
except at Dammam No.7.
On March 3, 1938, the Dammam well
struck oil. Within fifty days, the well produced
100,000 barrels, and subsequent probes led
to the discovery of fifty-two oil fields, including
Ghawar, which is still the world’s largest oil
field with an estimated remaining sixty-six
billion barrels of reserve.
Today, Chevron has a thirty-year operating
agreement with Saudi Arabia to operate the
Kingdom’s 50 percent interest in the hydrocarbon
resources of the onshore area of the
Partitioned Neutral Zone (PNZ) between the
Kingdom and Kuwait. The agreement expires
in 2039.
Chevron’s other undertakings in the
Kingdom include Saudi Chevron Phillips
Company, a $650 million petrochemical plant
in Al Jubail. This joint venture with the Saudi
Industrial Investment Group was established
in 2000, and it is the Kingdom’s first privately
financed basic petrochemical enterprise.
A second company, Jubail
Chevron Phillips was formed in
2003, and it began operating a $1.3
billion petrochemical facility adjacent
to and integrated with Saudi Chevron
Phillips in 2008. A third company,
Saudi Polymers, is currently building
a $5.2 billion plant that is designed
to produce a range of basic chemicals.
Saudi International Services Company,
Chevron’s joint venture with its former Aramco
partners, supplies Saudi Aramco with
technology and technical services. Chevron
arranges training for Saudi Aramco employees
in the United States and participates in technical
exchange meetings.
Chevron and Saudi Arabia have shared a
unique history for more than seven decades,
and Chevron is invested not only in the oil
and petrochemical industry, but also in a wide
range of educational and environmental
programs, such as the Saudi Wildlife Fund
and the Saudi Petroleum Services Polytechnic
in Dammam.
Chevron PNZ Steamflood Project
Achieves First Steam Injection
Significant Potential for Carbonate Reservoirs in Middle East
Chevron Corporation’s subsidiary, Saudi
Arabian Chevron (SAC), has achieved
the first steam injection at its $340 million
Large Scale Pilot (LSP) steamflood project
at the Wafra Field, an Eocene heavy-oil
carbonate reservoir in the onshore Partitioned
Neutral Zone (PNZ). The LSP is the final
test phase for the steamflood project and is
expected to lead to full-field steamflooding
of the First Eocene Reservoir. This is the
first commercial application of a conventional
steamflood in a carbonate reservoir anywhere
in the world.
George Kirkland, Executive Vice President,
Chevron Global Upstream and Gas,
explains that “full-field deployment of
steamflood technology in the PNZ would
significantly increase recovery of crude oil
reserves, confirm the technology’s potential
applicability in other carbonate oil fields,
and build on Chevron’s steamflood capabilities
that date back five decades.”
Steamflooding involves injecting steam
into heavy-oil reservoirs to heat the crude
oil underground, thereby reducing its viscosity
and allowing its extraction through wells.
Photos courtesy of Chevron
US-Arab Tradeline • Fall 2009 35