Bahrain announced the biggest crude oil discovery in its history that will “dwarf” its current reserves, media reported, citing the tiny kingdom’s official news agency. Details on the size of the reserves will be released later this week.
Bahrain is the smallest oil producer in the Persian Gulf, drawing its oil from the Bahrain Field at a rate of 45,000 bpd, and from the Abu Safah field that it shares with Saudi Arabia, which produces around 300,000 bpd. Bahrain’s daily total, including oil from Abu Safah, averages around 210,000 barrels.
Under a bilateral agreement from 1958, the two countries share the revenues from the field, but Aramco is the operator. Bahrain, for its part, refines its share at its single Sitra refinery and then sells the production. The Sitra refinery has a capacity of 267,000 bpd, which substantially increases domestic crude production, so most of the oil it processes comes from Saudi Arabia.
The new discovery is a shale deposit that lies off the country’s west coast, adjacent to the Bahrain field. “Initial analysis demonstrates the find is at substantial levels, capable of supporting the long-term extraction of tight oil and deep gas,” Bahrain’s Oil Minister Sheikh Mohammed bin Khalifa Al Khalifa said. Related: EV Revolution Could Cost Thousands Of Jobs
The discovery was made as the country seeks to raise production from the Bahrain Field to 100,000 bpd by 2020, despite the fact that it is currently bound by the OPEC production cut deal that may be extended beyond its December 2018 deadline.
Bahrain has proved reserves of around 125 million barrels of crude, but the new field’s resources could increase this substantially. The kingdom has been pumping oil since 1932. It is also a minor producer of natural gas, consuming all of its production locally. As demand grows, the kingdom plans to build an LNG import terminal along with expanding its crude oil production.
By Irina Slav for Oilprice.com
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Meanwhile renewable energy continues to find ways to cut cost, and become more competitive, and we could be months are just a few years away from a breakthrough in some area of renewables that would begin to make oil and gas energy supplies of the past.
Oil and gas are no longer scarce. OPEC and Russia increasingly have to idle more and more production despite basket cases like Venezuela, and we can see a future where oil & gas are not major contributors of the energy supply. U.S. producers should produce now as much as they can while they can get over $60 a barrel.