DUBAI: Saudi Arabian Oil Co, the world’s largest oil company by production, shelved plans to upgrade its aging onshore Dammam oil field at a cost of $1.2bn amid falling oil prices, people familiar with the plans said.
In a statement emailed on Saturday, Saudi Aramco informed companies interested in developing the field that the “requisition has been canceled,” the people told Zawya Dow Jones.
Aramco didn’t provide any additional details in the statement.
Under the original plan, the state-owned oil company had planned to upgrade the Dammam field, first tapped in 1938, to produce 100,000 bpd of crude at an estimated cost of $1.2bn. In October, Aramco had launched the initial phase of the project tender.
Oil prices that closed in New York below $50 a barrel on Friday may force the Middle East’s national oil companies to cutback plans to upgrade aging fields and pump more crude.
Last week, an Aramco official said at a conference in Dubai that Saudi Arabia, the world’s largest oil exporter, was reviewing its oil expansion projects and may delay some plans to boost output amid falling crude prices. – Zawya Dow Jones