Research has led to a range of alternative technologies and solutions

Local scientists and engineers working in Saudi Arabia’s laboratories and on its test rigs have been making significant research and development (R&D) gains in the energy technology sector in recent years. In 2014, Saudi Aramco set a new record for inventiveness and innovation – 99 patents were granted to the company in the US, while an additional 154 applications were filed with the US Patent and Trademark Office for consideration during that year. The total number of patents granted to the company in the US marked a significant increase over the 57 granted in 2013 and 58 in 2012. Saudi Aramco operated 11 international research centres and technology offices in 2014 and has focused its efforts in three key areas: upstream exploration and extraction improvements; downstream yields and efficiencies in refining and petrochemical processes; and technological advances in carbon management and the development of fuels and engines to increase the attractiveness of oil and its derivatives as an energy source.

Changing Landscape

The technological advances made by Saudi Aramco employees came during a volatile period for the world’s energy markets. In the introduction to BP’s “Statistical Review of World Energy 2015”, the firm’s CEO, Bob Dudley, said the events of 2014 should not be dismissed as “another bout of cyclical volatility”. He added, “Rather, they may well come to be viewed as symptomatic of a broader shifting in some of the tectonic plates that make up the energy landscape.” The BP report also described the “continuing revolution in US shale” as the most significant development on the supply side in recent years. During 2014 the US recorded the largest increase in oil production of any country and, according to the report, became the first country ever to increase its average annual oil production by at least 1m barrels per day for three consecutive years.

Statistics from BP show how the US has overcome obstacles to successful extraction of shale oil and gas and significantly boosted the country’s known reserves of both fuels. Proven oil reserves grew by 66% in the US from 29.3bn barrels in 2004 to 48.5bn barrels in 2014, while proven reserves of gas grew by 77.6% from 194.23trn standard cu feet (scf) in 2004 to 345trn scf in 2014. Over the same period, Saudi Arabia’s proven oil reserves grew by only 1.02% from 264.3bn barrels to 267bn barrels, while its proven natural gas reserves grew by a more significant 20% from 240.14trn scf in 2004 to 288.4trn scf in 2014.

Although the US’s share of world oil reserves remains a relatively modest 2.9% compared to Saudi Arabia’s 15.7%, the shale revolution has seen the US overtake Saudi Arabia when it comes to natural gas, with the US accounting for 5.2% of the global total in 2014 compared to Saudi Arabia’s 4.4% share. A study published in December 2014 by the California-based Breakthrough Institute suggested that although the technique of fracturing rocks to extract fuel was first invented in the late 1940s, the more recent revolution in successful extraction is the result of decades of R&D, much of which was funded by the US federal government from the 1970s onwards. Similarly, the investments Saudi Aramco is making in R&D in 2014 and 2015 may not all have an immediate impact on production, but could pave the way for advances in the future.

Upstream Endeavours

Saudi Aramco’s scientists and engineers have used everything from chemistry to nanotechnology to find ways to improve the company’s ability to find and extract hydrocarbons reserves more efficiently. A carbon capture project in Uthmaniyah has been conducting extensive trials on the capture and reinjection of CO2 to enhance oil recovery. In North Uthmaniyah a SmartWater Flooding demonstration was established to increase recovery by optimising water properties in carbonate reservoirs. Another team has been operating a pilot well to test new technology that uses surfactant and polymer formulations in injected water to help improve the recovery of tertiary oil, which is not produced under natural reservoir pressure or through water injections.

Saudi Aramco has also been considering manufacturing thousands of microchips, having already tested their ability to transmit downhole data during drilling. In its laboratories the company experimented with the use of in-situ exothermic chemical reactions to generate pressure pulses that create fractures around well bores, a technology which in 2015 the company plans to use for the first time in unconventional formations. The firm’s nanotechnologists are working on microscopic solutions that have the potential to make major differences. Saudi Aramco is also experimenting with passive building block nanoagents known as A-Dots that are one-thousandth the thickness of a human hair and can be injected into oil reservoirs to provide data, as well as with magnetic nanomappers, which may be used to map data about injected fluids inside hydrocarbons reservoirs. The company’s scientists have been working with a new class of chemicals that have the potential to reduce the viscosity of heavy oil, and its engineers are developing electric submersible pumps that could be manufactured in 2015 to enhance the extraction process at offshore fields such as Safaniya.

Downstream Development

The development of new downstream technology feeds into Saudi Aramco’s transformation from an oil and gas producer into an integrated energy company, with a rapidly growing emphasis on refining crude oil and producing petrochemicals. New downstream development initiatives have included: SuperButol, a one-step process that converts a mixture of butenes into mixed butanol liquids and could play a major role in Saudi Aramco’s clean fuels initiative; CAN-15, a new hydrocracking catalyst that has been developed in Riyadh to enhance performance in the processing of heavy demetalised oil; the opening of a new integrated pilot plant in the US tasked with producing olefins and aromatics directly from crude oil; and a new membrane that has been developed after two years of trials to block nitrogen and heavy hydrocarbons and thus increase natural gas liquid production at gas plants. Saudi Aramco’s 2014 annual report pointed out that R&D in both upstream and downstream areas can have a huge impact on the company and on the country’s economy. “Every percentage increase in recovery rates adds millions of barrels of recoverable oil to our reserve base,” said the report. “Every gain in operating efficiency expands our ability to provide more energy at a lower cost. More reserves and longer-lived production mean more energy for opportunities in Saudi Arabia and for our customers around the world.”

Global Research

Saudi Aramco is also conducting more strategic research with an emphasis on the development of more efficient combustion engines and cleaner fuels to ensure the long-term future of oil-based energy. Recent trials of fuel detergents on large vehicle fleets in Saudi Arabia suggested fuel efficiency savings of 1.6% and 3% could be achieved for petrol and diesel, respectively, which could lead to an annual saving of 5.6m barrels of diesel and 3m barrels of petrol. Saudi Aramco has also conducted fuel and engine research in conjunction with automotive manufacturers in Paris and Detroit. These two centres are part of the company’s global research footprint and a reflection of its desire to focus some of its R&D activities abroad at international innovation centres.

In 2014 construction began on a Clean Combustion Research Centre at King Abdullah University of Science and Technology (KAUST), while Aramco’s Research Centre in Boston is adjacent to MIT, where research on membrane technology has been taking place alongside work on computational modelling and nanotechnology. In September 2014 the firm inaugurated its largest research centre outside of Saudi Arabia in Houston, Texas, where scientists are working on advanced seismic imaging, unconventional productivity enhancement, smart fluids to improve well productivity, nano-based polymers, surfactants, cement technologies, quantitative geology and advanced downhole sensors. At the Delft Research Centre in the Netherlands, Saudi Aramco is focusing on subsurface imaging and seismic processing, while in South Korea the company is collaborating with the Korean Advanced Institute of Science and Technology on carbon capture technology. A new Beijing Global Research Centre inaugurated in April 2015 is looking into geology, geophysics and production chemicals for advanced oil recovery. The firm’s technology office in Aberdeen, UK now houses Saudi Aramco Energy Ventures (SAEV), which by the end of 2014 had made 13 capital investments in start-ups and high-growth companies of strategic importance to Saudi Aramco. In 2014, 11 new proposals were presented to SAEV’s investment committee.

Although the company’s research network is global, it also has a long track record of involvement with Saudi universities and technology initiatives, including KAUST, King Fahd University of Petroleum and Minerals, and Dhahran Techno Valley Company. According to the firm’s 2014 annual report, “R&D efforts are also aiding the development of the leading Saudi engineers and scientists of tomorrow and fostering the development of the Kingdom’s innovation ecosystem.”

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This article is from the Energy chapter of The Report: Saudi Arabia 2015. Explore other chapters from this report.