Preparations for an expected increase in world demand for crude oil during the 1990s are under way in many oil producing and exporting countries.
The world's major league producers and exporters in the Middle East are putting together multibillion dollar investment programs to boost sustainable productive capacity from their ample reserves.
Minor players sitting on more modest reserves also want to cash in on the higher prices expected during the decade and are encouraging local and foreign companies to step up exploration work.
Prospects for big discoveries in many of those countries are limited, forcing governments to ensure more prudent use of existing oil reserves and development of gas resources to reduce petroleum products use.
GAS AND LIGHT CRUDE
Syria is one of the countries preparing for the 1990s through the exploration/gas development route. During the past 2-3 years the government has capitalized on light crude discoveries in Northeast Syria by the Royal Dutch-Deminex combine's Al Furat Petroleum Co. to attract additional foreign operators that have licensed most of the prospective acreage in the country.
With exploration activity on the rise, the government in Damascus has turned its attention to the country's underexploited gas resources. Further appraisal of two potentially interesting strikes made in the early 1980s could allow four power generating stations to switch from burning heavy oil to gas.
Cherrife and Ash Shaer fields were discovered by Marathon Petroleum Syria Ltd. about 150 miles northeast of Damascus in 1982 and 1985. But Marathon's production sharing contract expired before appraisal was complete.
State owned Syrian Petroleum Co. has gas discoveries in the same area, around Palmyra. Syrian authorities estimate the region holds gas reserves of 2.7 tcf, about half the country's total of 5.54 tcf.
At the end of 1988 Marathon signed a new style production sharing contract designed to encourage gas exploration by foreign companies by allowing them to participate not only in development of reserves but in projects to use the gas.
As a result of the deal, Marathon is committed to spend $60 million on exploration on the 9,952 sq km permit and drill 12 wells during an 8 year period. At first, however, the program was aimed at appraising the two earlier gas finds. The program is off to a good start with the first well, 3 Ash Shaer, flowing 40.6 MMcfd.
WHAT'S NEXT
If the two fields are declared commercial, Marathon will provide as much as $20 million for power stations conversion and pipelines to transport 210 MMcfd that will be needed to fuel the stations. Cost of the pipelines will be recovered as part of the field development project.
Longer term, the new gas contract also allows Marathon to get involved in other distribution projects, new power generation, and petrochemicals. And, if there are enough reserves, Marathon could even get into the gas export business.
Copyright 1990 Oil & Gas Journal. All Rights Reserved.