Energy Exploration & Exploitation

A comprehensive review is provided of Saudi Arabia's petroleum industry covering oil and gas exploration and production, refining, oil and gas trade, marketing and Saudi overseas investments. Profiles of key Saudi decision makers are provided.

A statistical appendix includes data from the start of oil production in Saudi Arabia in 1938.

Part I Geological potential

Ultimate recovery data are frequently modeled as being lognormal without consideration of other possible distributions. A typical approach is to use lognormal probability paper and a mean value (Swanson's mean) is calculated as well as chance factors. Engineers have identified a competing probability model for lifetime data called the Weibull distribution. In this paper, we consider the Weibull distribution as a potential alternative probability model for ultimate recovery data. Optimal methodologies of estimating the mean ultimate recovery for both the lognormal and the Weibull distributions are presented. Statisticians refer to this optimal approach as maximum likelihood methodology. Further, probability plots and hypothesis testing methods are presented that help reveal whether one should use the Weibull model or the lognormal model for available ultimate recovery data. Finally, a simulation approach is proposed to predict the average ultimate recovery value for “n” additional wells. An example with real data concludes the paper.

With declining coal, oil and gas production, Hungary's domestic supply will fall from near 12 million tonnes oil equivalent to 10 million tonnes through the next decade. Energy demand will be met by some increase in coal and gas imports whilst oil imports will remain steady.

The 1999 IEA Review of Japan's energy policy included a detailed assessment of the subsidies given to Japan's coal producers. Japan's coal reserves are estimated at 821 million tonnes with the R/P ratio (reserves to production) in 1997 being 191 to 1.

In 1996 and 1997 the average price of Japan's steam coal imports was less than $50 per tonne.

In 1998 France, Germany, Spain and Turkey provided substantial subsidies for their coal industries. In Germany, production of 42 million tonnes was subsidised at a rate of $120 per tonne. These are listed in Table 1.

In the UK, subsidies finished in March 1998 although the UK government will be involved in payments to ex-miners for some years yet.

A recent BP Amoco investment in the Russian oil company Sidanco had to be considerably written down following transfer of Sidanco's main oil producing company to another entity.

The EBRD could make major investments in Russian oil and gas companies which would take the EBRD into an area much more risky than those described here. The move is speculative at present and doubtless the EBRD will be well aware of the BP Amoco experience.