Aramco Starts Production at Jafurah Shale Gas Field
Aramco started production at the Jafurah shale gas field to replace domestic oil use. This project aims to boost export revenues by billions of dollars.
The shale revolution that established the United States as a leading global energy producer is now being replicated in the Arabian Desert. Located deep within the sands southeast of the Ghawar oilfield, Saudi Arabia is moving forward with a natural gas megaproject at the Jafurah basin that is expected to generate billions of dollars in additional revenue. To drive this development, the Saudi Arabian Oil Company has partnered with major international firms, including Halliburton Company and China's Sinopec Oilfield Service Corporation. These companies are deploying advanced machinery, such as walking rigs, to accelerate drilling and well completions in the unconventional basin.
The Jafurah project is central to a $100 billion investment strategy as the kingdom seeks to become a major player in the global natural gas market. The basin is estimated to contain 229 trillion standard cubic feet of raw gas and 75 billion barrels of condensate, making it potentially the largest shale gas development outside of North America.
\"Jafurah is not just a large gas field: it is a strategic platform that supports the Kingdoms broader growth ambitions across key sectors, including energy, artificial intelligence, and major industries like petrochemicals, Aramco said in a statement in response to Reuters questions.\"
The project officially reached a milestone on Thursday with the announcement that production at Jafurah commenced in December 2025. Nasir Al-Naimi, Upstream President of Aramco, highlighted the importance of the project's progress.
\"Early well performance has been outstanding, validating our high-tech approach and reaffirming the significance of this flagship project to our gas growth strategy.\"
The economic rationale for the expansion is clear. The kingdom currently consumes over 1 million barrels per day (bpd) of crude and fuel oil for domestic electricity. By 2030, Aramco aims to replace 500,000 bpd of this liquid fuel with gas, allowing more crude to be sold on the international market. At current prices, this shift could yield nearly $12.8 billion in annual revenue.
Data analyzed from the Baker Hughes Company indicates that Jafurah has become a primary capital project for the kingdom. While activity in the American Permian Basin has stabilized, gas drilling in the region has intensified following the cancellation of a planned oil capacity expansion.
Since 2018, Aramco has awarded approximately $26 billion in contracts for the first two phases of the project. In addition to U.S. and Chinese firms, contracts have been granted to companies from South Korea and Italy, including SAIPEM SPA.
By 2030, the target for Jafurah is to produce 2 billion standard cubic feet per day (bcfd) of gas, alongside significant volumes of ethane and associated liquids. Monica Malik, chief economist at ABU DHABI COMMERCIAL BANK, noted that the project could contribute 0.3% to the national GDP by 2026, though some analysts remain cautious regarding the speed of the production ramp-up.
The move comes as regional competitors also expand their capacity. Qatar is advancing its own production goals to maintain regional dominance, while the United Arab Emirates is making significant investments in domestic and international gas infrastructure. To bolster its global reach, Aramco has also signed long-term supply agreements with firms such as NextDecade Corporation for projects in the West.
\"Through our strategic gas expansion, we anticipate attractive double-digit returns as we set about unlocking significant volumes of high-value liquids and capitalize upon captive domestic gas demand, Al-Naimi told Reuters.\""}```
