Energytothe World Vol 2 English

ENERGY TO THE WORLD:
ENERGY TO THE WORLD:

THE STORY OF SAUDI ARAMCO
THE STORY OF SAUDI ARAMCO

VOLUME 2
VOLUME 2
www.saudiaramco.com
J energy to the world : Volume one title K
Vo l u m e T W O
Energy to the World

The Story of Saudi Aramco
ii energy to the world : Volume one
Vo l u m e T W O
Energy to the World

The Story of Saudi Aramco
Supertankers load crude

oil at Ras Tanura Sea Island
Terminal in 2003.
Contents
Copyright First Edition Volume One Volume Two

© 2011 by Aramco Services Company Printed in 2011
Preface xi Illustration: Saudi Arabia viii
ISBN All rights reserved. No part of this book Illustration: Saudi Arabia xiv 1 National Resources 1
978-1-882771-23-0 may be reproduced, stored in a retrieval
system or transmitted in any form or 1 Prospects 1 2 Boom Time 27
Library of Congress by any means, electronic, mechanical, 2 Negotiations 33 3 Transformation 67
Control Number photocopying, recording or otherwise,
200922694 without the written permission of 3 Reading the Rocks 59 4 Rising to the Challenge 99
Aramco Services Company, except by 4 The War Years 93 5 Achieving the Vision 131
Written by a reviewer, who may quote a brief
Scott McMurray passage for review. 5 Expansion 123 Appendix 168
6 Growing Pains 153 A. Upstream 170
Produced by
The History Factory 7 Balancing Act 189 B. Downstream 184
Chantilly, Virginia, USA
List of Abbreviations 215 C. Operations Data 194
Project Coordinators Notes on Sources 216 Company Leadership 204
Theodore J. Brockish, Kyle L. Pakka
and Mohammad S. Abu Al-Makarem, Image Credits 220 Acknowledgments 206
Saudi Aramco with special thanks to Index 223 List of Abbreviations 209
Muhammad A. Tahlawi
Notes on Sources 210
Published by Bibliography 214
Aramco Services Company
Houston, Texas, USA Image Credits 216
www.aramcoservices.com
Index 219
Designed by
Pivot Design, Inc.
www.pivotdesign.com
Printed by
Altraiki Printing Company
Dammam, Saudi Arabia
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Z energy to the world : Volume two national resources 1
chapter one
National Resources
An exploration camp in the

Rub‘ al-Khali, 1966.
2 energy to the world : Volume two national resources 3
The 1960s marked a period of accelerated

change and development for both Saudi
Arabia and Aramco. In step with other oil-pro-
ducing countries, Saudi Arabia was becoming
more assertive in terms of its desire to derive
as much wealth as possible from its under-
ground resources. The pace of spending on
modernization and development projects in
Saudi Arabia quickened as the reform-minded
Crown Prince Faysal succeeded his brother
King Sa‘ud in 1964.
The era marked a significant change in the leadership of Aramco as well, as Thomas C. Barger
became chief executive officer of Aramco in 1961. Barger, named president in 1959, had in
many ways been training for the role of CEO for 20 years. He joined the oil company in 1937 as a
geologist and moved to Government Affairs in 1941. He brought to the CEO post wide-ranging
interests and a genuine concern for the welfare of Saudi employees and the country in general.
His interests, including improving medical facilities and the employee Home Ownership Program
and aiding local businesses, often went beyond his immediate portfolio of responsibilities. As
a contemporary of his recalled, “He was always identified with the future. He was always the
planner, the idea man … always planning new areas of endeavor.”
While driving change at Aramco, Barger never lost sight of the core principles that he felt
A helicopter approaches the Aramco defined the organization. A list of 12 “Planning Guides” he distributed in 1960 underscored his
Mobile Drilling Platform 2 (AMDP-2)
in 1967. The use of AMDPs eliminated ability to remain focused on the essential reasons for the company’s existence. The goals topping
the need to construct a fixed drilling that list were “to preserve the Concession and optimize the returns to the Shareholders over
platform for every new offshore well.
the term of the Concession; to maximize Saudi participation in the economic support of the
enterprise; [and] to ameliorate the impact of the enterprise on Saudi society.” (See “Barger’s
Vision,” p. 6.)
Barger reportedly told a friend shortly after being named president, “The day a man
becomes president of a company is the last day he knows what’s going on in that company.”
Barger countered this isolation—perhaps an inevitability arising from what a colleague called
the “process of management”—by grooming up-and-coming leaders such as Frank Jungers and
Crown Prince Faysal meets with Not all oil companies were happy to see BP cut its posted price. The Middle East was still in
Aramco’s Ras Tanura employees
in March 1963. In the same month, the throes of Nasser-era Arab nationalism with its anti-Western, anti–oil company biases. Many
he concluded negotiations with executives worried as 1960 wore on that further price cuts would only fuel widespread resentment
Aramco to increase government
royalties from Tapline and reduce
in the Arab world and might even jeopardize existing business relationships for Aramco in Saudi
the size of the concession area, Arabia and IPC in Iraq. Even some at Jersey, considered among the most chauvinistic of U.S. oil
both part of his broader plans to
stabilize the domestic economy and
companies, expressed concern that further price cuts should not be made without close consultation
increase the pace of modernization. with the producing countries’ governments.
Oil in the Arab States
One of the most widely read and influential books among the oil producing countries’
decision makers in the late 1950s and early 1960s was Oil in the Arab States, by Iraqi scholar
Muhammad Jawad Al-‘Abbusi, an economist who studied at the Sorbonne in Paris and taught
at the College of Arts in Baghdad. Published in Cairo in 1956, the book was translated into
English in 1958. Oil in the Arab States detailed the economics of the oil industry, and Aramco
disputed some of its conclusions in a commentary sent to company executives. However,
the underlying theme—a driving force behind the creation of OPEC—argued that oil was
of overriding national importance, not just economic importance, to the producing states
in the Middle East:
In fact, the oil industry in all its stages, from exploration to marketing, gives rise to
R. W. “Brock” Powers. He remained committed to ensuring the ability of Aramco’s leadership important economic and political problems bearing closely on the national interest. For An Aramco delegation departs
Dhahran en route to the sixth Arab
to stay abreast of the challenges thrown at them by a changing industry, an anxious and ambitious this reason the profit and cost factor is often only of secondary importance. Another Petroleum Congress in March 1967.
host country and a volatile world. This commitment was sorely tested by the events of the 1960s. principle takes precedence and exercises almost absolute control over the industry; it is The Arab Petroleum Congress,
OPEC’s predecessor, was formed
“guaranteeing the regular and continuous supply of oil for the state under easy terms.” in April 1959 with members rep-
Organization of Petroleum Exporting Countries By 1960, the world was once again awash This is the view taken by consumer countries. Producer states, on the other hand, hold to resenting Venezuela, Iran, Saudi
Arabia, the United Arab Republic
in oil. The unexpected surge in postwar demand had been more than offset by rapidly increasing the principle that “all natural underground resources of the state are the property of the (the short-lived union of Egypt
worldwide production. Further, more players were joining the game. As of the mid-1950s, the state.” An important conclusion may be drawn from this, namely: “That the development and Syria), Kuwait and Iraq.
Soviet Union, desperately in need of foreign exchange with which to fund its postwar rebuilding of oil resources is more a matter of national than of purely economic importance.”
and industrialization programs, began exporting oil in increasing quantities, often significantly
below posted prices in the Middle East.
In the late 1950s, oil companies held constant the posted price—the basis for their profit split
with the countries—even as the market price was declining. Although most companies still remained Jersey Chairman Monroe Rathbone listened to such arguments, then cut the price of Jersey oil
highly profitable, by 1959 the spread between the posted and market prices had widened to the anyway, assuming the warnings of backlash were overblown. On August 9, 1960, Jersey announced
point that profit margins were noticeably eroding. The Soviet Union’s reentry into the global oil reductions ranging from 4 to 14 cents a barrel on various classifications of Middle Eastern crude. Other
market spurred fears among industry executives that the market would become saturated, lowering major oil companies followed with similar cuts shortly thereafter.
A team of Iranians joins representa- prices still further. It was only a matter of time before one of the global oil companies cut its posted Slightly more than a month later, representatives of Saudi Arabia, Venezuela, Kuwait, Iraq and Iran,
tives from Kuwait, Iraq, Saudi Arabia
price to put it more in line with market realities. The British Petroleum Company (BP) was the first nations representing more than 80 percent of world crude oil exports, met in Baghdad. Within a week,
and Venezuela for the first conference
of the Organization of Petroleum to do so, cutting its posted price for crude by 18 cents, or about 10 percent, in early 1959. One of they had formed an organization—a more representative successor to the Arab Petroleum Congress,
Exporting Countries (OPEC). Held in
Aramco’s owners, Jersey, followed suit in 1960. which had been formed in 1959—with which they could present a united front in dealings with the oil
mid-September 1960, the conference
allowed the oil-producing nations Oil-producing countries protested, as the action cut directly into their national revenues. The companies: the Organization of Petroleum Exporting Countries, popularly known as OPEC.
to present a united front against oil
move cost the four largest oil-producing countries in the Middle East an estimated $132 million in OPEC’s presence abruptly halted the trend toward cutting posted prices among global oil companies
companies’ attempts to cut the price
of crude oil. income. Abdullah Tariki, Saudi Arabia’s Director General of Petroleum and Mineral Affairs, railed by creating at least the potential for coordinated, joint action by the governments of oil-producing
against the cuts, as did other Middle Eastern governments. At the 1959 Arab Petroleum Congress in countries against the oil companies. Indeed, oil prices trended sideways for much of the decade. Beyond
Cairo, held shortly after BP announced the price cuts, Tariki and other government representatives that, OPEC did not have a dramatic impact on the world oil industry until the early 1970s. With a few
met in secret to produce a “Gentlemen’s Agreement” in response. Among other things, it called for exceptions, the 1960s saw oil-producing countries and oil companies focusing on the common goal
the establishment of national oil companies and changing the existing 50/50 profit split to 60/40, of increasing production to boost profits. In the five years from 1957 to 1962, oil production in the
with oil-producing countries getting 60 percent of the profit from their oil. Public action came the Kingdom increased by more than 50 percent (from 1.02 million barrels per day, or bpd, to 1.64 million
following year. bpd). Revenue also soared, from $306 million in 1957 to $414 million in 1962.
Abdullah Tariki, who was named the Kingdom’s first Minister of Petroleum and Mineral Resources
in 1960, was the principal driver of Saudi oil policy. In many ways, his positions were ahead of his time.
In various interviews with the Middle Eastern press in early 1961, he advocated converting Aramco into
an integrated oil company that included marketing as well as refining. He also declared that Aramco
should cease the flaring of any natural gas produced in association with crude oil, a common practice
across the Middle East at the time given the minimal local demand for gas. Instead, he favored the
development of a petrochemical industry using Saudi natural gas and crude oil as feedstocks.
Tariki’s political opinions, however, left him increasingly out of step with the Saudi govern-
ment. Tariki did not assume ministerial rank until Crown Prince Faysal, in a dispute over the annual
budget for the country, relinquished administrative control of the government in late 1960 and
King Sa‘ud once again assumed control of the day-to-day governmental operations. For the next
Barger’s Vision
While steering Aramco through the tumultuous 1960s, CEO Thomas C. Barger’s
clear priorities helped keep Aramco leadership focused. The following are “Planning year, Tariki was the undisputed voice of Saudi Arabia on all matters relating to oil. By October 1961, Senior Saudi and Aramco officials sign
the March 1963 agreement increas-
Guides for Aramco as a Corporation,” which Barger penned in 1960: however, government radio was broadcasting comments on the oil industry that were noticeably
ing Saudi royalties on Tapline oil and
more moderate than Tariki’s during the same period: settling other claims. Around the
table, from left to right, are William
1. To preserve the Concession and optimize the returns to the Shareholders over Under the leadership of His Majesty the King, Saudi Arabia is employing all possible
L. Owen, Aramco’s general counsel;
the term of the Concession. means to derive maximum benefit from its oil resources, and to this end it is cooperating Peter C. Speers of the Government
with all other states which are working along the same lines. Our method of achieving Affairs Department; Ahmed Zaki
2. To maximize Saudi participation in the economic support of the enterprise. Yamani, Minister of Petroleum and
3. To ameliorate the impact of the enterprise on Saudi society. this aim is to base our course of action on the principles of equality and justice within Mineral Resources; J. M. Curry of
the framework of voluntary association with the oil companies. the Law Department; Hasan Gazzaz,
4. To provide technological and managerial assistance to the society and economy editor of Al-Bilad newspaper;
of Saudi Arabia, especially in the Eastern Province. Robert I. Brougham, senior vice
Change was in the air. A cabinet shuffle in March 1962 left Crown Prince Faysal once again president of Aramco; and Abdul
5. To carefully evaluate side effects of Aramco actions, before they take place, and Hady Taher, governor of Petromin.
ensure that expenditures of money or good will do not outweigh returns expected. playing an active role in the government. This time, Tariki was not included. He had in fact been
6. To spread economic benefits of the enterprise as widely through the local population removed the previous November and had subsequently moved to Beirut, where he worked as an
as possible even at some extra cost by adoption of policies that direct the purchasing oil industry consultant. In his place as the new Minister of Petroleum and Mineral Resources was a
Thomas C. Barger in 1961. power of Aramco employees to the development and support of services generally young, accomplished Saudi lawyer named Ahmed Zaki Yamani.
available to the public. Cool and calculating, the 32-year-old Yamani, armed with a law degree from the University of
7. To set standards of behavior that are in accordance with best industrial practice in the Cairo and a master’s in comparative jurisprudence from New York University, as well as additional
United States, and standardize conduct of the affairs of the Corporation in respect to graduate work at Harvard, was well prepared to assume the ministerial role. The native of Makkah
the treatment of employees, and relations with the Government and public that was no stranger to Aramco, having successfully defended the company in a suit in Shari‘ah court
Corporate actions can be always justified to a reasonable Saudi acquainted with filed by a merchant in Hofuf. Comparing Yamani with Tariki, a former secretary general of OPEC
business practices elsewhere. remarked, “He got more out of Aramco because he got on with Aramco.”
8. To ensure the provision in the Corporation of competent technical, managerial,
administrative and craft skills. “Tenacity and Patience” One of Yamani’s first orders of business was to tackle some of the
9. To keep abreast of technological advances in oil fields bearing on the business of the long-festering pricing issues that Tariki had not been able to resolve. The most critical matter
Corporation and apply new techniques as they can contribute to the efficient operation concerned the method Aramco used to calculate Tapline profits. It became known as the Sidon
of the Corporation. price claim, after the Mediterranean port in Lebanon marking the western terminus of the pipeline.
10. To do what we reasonably can to obtain better mutual understanding between From July 1962 through March 1963, a group of government experts and Aramco officials
Saudis and Americans. and lawyers met repeatedly to settle the matter. At the core of the Sidon price dispute was
11. To plan facilities so as to insure reasonable protection against unforeseen contingencies, the Saudi contention that Aramco was treating Tapline as a facility operated for the benefit of
industrial or political. the oil company’s shareholders and not part of Aramco itself. The government had alleged for
12. To be informed and alert to social and political change in order to adapt the years that Aramco was passing on to its owners the profits on the oil carried by the pipeline
Corporation’s activities, but not to direct or influence other than normal industrial rather than having those profits accrue to Aramco and, therefore, be subject to taxation by the
necessities will inevitably influence. Saudi government. As a result, Saudi representatives argued that the company owed the Saudi
government $186 million in back payments.
In 1962, an all-Saudi crew was

assigned the responsibility of manag-
ing the complex operations of the
Ras Tanura fluid hydroformer during
the night shift. The men—Ahmad
R. Al-Moqbil, Farraj T. Al-Manasir,
Hullayil Aqil, Hilal Y. Al-Huzaim,
‘Abd al-Rahman M. Mubarak, Saleh
A. Al-Ajam, ‘Aziz A. Sa‘d and Zaid
Abdul ‘Aziz—trained extensively at
an Aramco Industrial Training Center
before their assignment.
Oil traveling to the Mediterranean via Tapline, even after accounting for maintenance
costs and fees paid to the countries through which the pipeline passed, did so at a lower cost
than oil carried by tanker through the Suez Canal. However, Aramco’s owners charged their
non-shareholding customers at the Sidon terminal prices roughly equal to the prices posted at
the Ras Tanura Terminal in the Gulf plus the cost of tanker transportation through the canal.
Aramco sold the oil to its four shareholding oil companies at a lower price, which was equal to
the Ras Tanura price plus the cost of pipeline transportation. The shareholders pocketed the
difference between the cost of shipping via tanker and the cost of shipping oil through the
pipeline. It came to pennies per barrel, but tens of millions of barrels of oil had been shipped
under this pricing scheme.
The two sides reached an agreement on March 24, 1963. The Saudis rightfully claimed
total victory, and the agreement was seen as a vindication of the new approach toward the oil
companies adopted by Crown Prince Faysal and implemented by Yamani. The Minister, who
had maintained that the government was not about to compromise on the issue of its own tax
laws, saluted the “tenacity and patience” of the Saudi negotiators. According to Yamani, “The
company recognized what was right, for which it is duly thanked.” He noted that the Tapline
issue and other tax claims settled at the time totaled more than $160 million.
The Changing Face of the Workforce Reflecting the worldwide glut in crude oil supplies
and the conclusion of most of the major construction projects it had initiated in the 1950s,
Aramco tightened its belt. From a total payroll of nearly 25,000 employees in the mid-1950s,
the number steadily diminished for the balance of the decade. In 1960, Aramco cut its total
staff again, this time by roughly 10 percent, from 16,257 to 14,834. More than 400 of the cuts
came from the 1,505 employees who were neither Saudi nor American, but rather a group that
included Indians, Italians, Palestinians and other nationalities. In a related move, the company
closed recruiting offices in Pakistan and Aden. The American payroll was also reduced by 12
percent. Only 5 percent of Saudi jobs were cut, leaving Aramco with 11,140 Saudi employees
by the end of 1960.
While fewer in number, Aramco’s Saudi employees by the start of the 1960s were a much
more stable, better trained and better paid workforce than ever before. As of 1960, 46 percent
Saudi employees study physics at
the Dhahran Industrial Training Center
had at least a decade of uninterrupted service with the company. In addition, roughly three-
(ITC) in 1964. Students earned the quarters of the Saudi workforce held semiskilled, skilled or supervisory jobs at the start of the
chance to obtain a fully paid scholar-
ship from Aramco by successfully
decade. Since 1955, the average annual income of Saudi employees had soared 86 percent, to
completing the ITC curriculum. 7,830 riyals.
The 1960s were marked by continued declines in employment as oil processing facilities
became more highly automated and productive. By 1970, the Aramco payroll had been reduced
by 28 percent to just 10,606 employees, 80 percent of whom were Saudis. Those employees
were producing much more in terms of oil revenue per employee, however. From 1962, when
it generated $383 million in taxes, royalties and fees for the government, Aramco’s total annual
payments to the Saudi government more than tripled to $1.159 billion in 1970.
New Initiatives Enrich Saudi Educ ation Educational opportunities within the Kingdom
continued to expand dramatically during the 1960s. From elementary schools for girls to a college
dedicated to educating Saudis in the oil and mining industries, the pace of change quickened. led Aramco to agree to extend its commitment to build schools for sons of Saudi employees to While attending Robert Morris Junior
College in Pittsburgh, Pennsylvania,
By the late 1950s, an increasing number of Saudis advocated public elementary schooling include daughters as well. The company committed to building elementary schools for girls in
in 1962, Aramco employees, left to
for girls as well as boys. In 1958, the director of education for the Eastern Province estimated the Eastern Province at a rate of two schools per year, with a capacity of 300 pupils per school. right, Omar Bataweel, Muhammad
Hasan, Muhammad Sa‘id Al-Ali, ‘Ali
that more than 3,000 girls already were being educated at “informal school classes in homes While negotiations with various government agencies progressed over the next few years,
Dakheel Aburqubah, Saleh Al-Faleh
scattered throughout the Eastern Province,” such as the school run in the al-Khobar family home Aramco in 1962 donated portable buildings to serve as schools until permanent facilities could and ‘Abdal ‘Aziz Al-Abid take
of the mother of future Aramco President and CEO Abdallah S. Jum‘ah. be constructed. On September 15, 1964, Aramco turned over the first two girls’ schools, built time to explore the region.
In October 1959, King Sa‘ud announced over Radio Makkah his support for the creation in al-Khobar and Rahimah. The company also agreed to pay for recruiting and training female
of girls’ schools nationwide. This pronouncement set in motion a series of steps that in 1961 teachers for the girls.
Students gather in the courtyard By this time, the company also was building intermediate schools for boys. The Aramco
of the Aramco-built Dammam Girls’
School in 1970. Ten years after the school-building program during the 1960s endured a few setbacks, particularly the difficulty
establishment of Saudi Arabia’s first encountered in integrating these schools into the existing public school system, but the program
girls’ school, enrollment had risen
to more than 100,000 nationwide.
was considered an overall success. A 1967 internal company review noted that Aramco had built
30 schools in the Eastern Province in just 14 years, providing an education for 2,400 girls and 5,700
boys. The cost of construction was $10.5 million, and annual operating costs were estimated at $2.5
million, expenses that Aramco assumed as part of its agreement with the Saudi government. The
company paid for the construction, operation and maintenance of the schools until the program
ended in January 2007. A total of 139 schools were built, 74 for boys and 65 for girls.
First Professional Woman
At roughly the same time Aramco was building its first elementary school for girls in the
Eastern Province, it also hired its first Saudi woman with a college degree. Najat Al-Husseini,
a graduate of the University of Damascus, joined the company in 1964. When she applied
A young Saudi girl rides a tricycle
to Aramco, company officials were not sure how to proceed, as there was no precedent for
on her school grounds. Girls had
previously been able to attend mostly hiring a Saudi woman college graduate. Al-Husseini’s father, Colonel Ibrahim Al-Husseini,
unofficial, home-based schools but a special adviser to Prince ‘Abd Allah ibn ‘Abd al-‘Aziz, then head of the Saudi National
were given new opportunities
when the first Saudi government Guard, helped clear the way. He personally approached King Faysal, a staunch advocate
girls’ schools opened in 1960. of women’s education, and received his approval. With approval from the King, Aramco
quickly added Al-Husseini to the staff. Her five brothers, Hassan, Haitham, Ihsan, Moujahed
and Sadad, followed in her footsteps and also joined Aramco. Moujahed earned his
doctorate in geophysics from Brown University in Providence, Rhode Island, and retired In 1964, Najat Al-Husseini
became the first Saudi woman
from the company as manager of Exploration and Producing. Sadad, who also graduated
with a college degree to join
from Brown with a doctorate in geology, retired as an executive vice president in 2004. Aramco. During her years with
the company, she worked to
Aramco continued to hire women in professional positions and set up training
educate the families of Saudi
programs for them. Many of the first generation of professional women to join Aramco employees about health issues.
worked in health care and related fields. Professional women in subsequent decades
were hired and trained in virtually all areas of the company, from corporate planning to
reservoir management.
College of Petroleu m and Miner als When he was named Minister of Petroleum and
Mineral Resources in 1962, Yamani inherited plans to form a university to train Saudis in the
oil and mining industries. The initial purpose of the college was to serve as a technical institute.
However, Yamani had grander plans—he wanted it to adopt a wider curriculum and train the
Saudis who would eventually run Aramco. This was one reason the college was kept under
the administrative wing of the Ministry of Petroleum and Mineral Resources rather than the
Ministry of Education until the mid-1970s, when it was transferred to the control of the new
Ministry of Higher Education.
Founded by a Royal Decree on September 23, 1963, the College of Petroleum and
Minerals was to be located near Dhahran. The following year, Aramco released land for the
school, including about 50 buildings, originally part of the “Saudi camp,” to be used as student
housing. In 1970, the company agreed to donate a combined $11 million to the school in three
installments between April 1970 and January 1972.
Students stroll on the campus of the The Americans and other expatriates living in the Aramco residential communities
College of Petroleum and Minerals
in 1967. The college, adjacent to developed a strong support system as well. To many of them, their sense of “family” seemed
Aramco’s Dhahran headquarters, stronger than the ties forged among expatriates working for other Western employers. Frank
offered an English-language curriculum
of technical subjects that expanded
William “Bill” Tracy, Jr., moved to Ras Tanura from Illinois in 1946 at age 11. His mother brought
over the years to include many him, his brother and his sister to join their father, Frank Tracy, Sr., who was working in cost
engineering and scientific disciplines.
accounting at the new refinery. In 1967, Bill joined a company subsidiary as a writer and editor
for Aramco World and other publications. He later worked for the company in Dhahran and
Houston, Texas, before retiring in 2000. He had fond memories of the sense of community
among Aramco employees:
Administrators and staff, including the first dean, Saleh Ambah, prepared furiously until
September 22, 1964—the night before the school’s first class of 67 students arrived. The institu-
tion’s name was changed to the University of Petroleum and Minerals in 1975, and in 1986 it was
given its current designation, King Fahd University of Petroleum and Minerals (KFUPM). Today, it
enrolls more than 10,000 students.
Aramco World By the mid- to late 1960s, a new generation of Saudis in the Eastern Province was
coming of age in what in many ways was an Aramco world. Khalid Al-Falih, the son of Abdulaziz
D. Al-Falih, an Aramco executive who had started working for the company in the early 1950s
and retired in 1997 as vice president of Material Supply, grew up in a section of Dammam known
as Madinat al-‘Ummal (“Labor City”). The neighborhood had been developed by Aramco as part
of its Home Ownership Program. Al-Falih and his friends went to schools built by Aramco. When
he wasn’t studying, he was listening to Aramco radio or watching Aramco television.
Al-Falih, who earned a bachelor’s degree in mechanical engineering from Texas A&M and
an MBA from KFUPM, was named president and CEO in November 2008 and assumed office
on January 1, 2009. He recalled that Aramco employees were known for their work ethic, and
they were proud of it:
“All of the neighborhood that I lived in was composed of Aramco. … The Aramco employees
were very industrious, they left their homes at dawn and came back at or after sunset. The The thing was, because the Americans were so far from home and you couldn‘t Margret Tracy, an 11-year veteran of
the expatriate life, shops for spices in
working hours were longer at the time … the men were gone all day to work at Aramco.” easily make phone calls, you got this sense of family. So if mother wanted to know
Rahimah, near Ras Tanura, in 1957. As
Indeed, while every Aramco worker had an identification badge, working at Aramco and how to cook a turkey she couldn’t call her mother or her aunt or her older sisters, Aramco prospered, its communities
and the adjacent towns also grew,
Aramco’s Home Ownership Program being able to take advantage of all the company offered was a mark of honor in its own right. she had to talk to the lady next door. So you got this kind of family relationship
but the common factor was the com-
allowed Saudi employees to finance
As Sadad Al-Husseini, who retired as an executive vice president in 2004, recollected: that you wouldn‘t find ordinarily. Also, a lot of people who lived overseas would pany. Employees and their families,
the construction or purchase of homes
whether expatriate or Saudi, forged
like this Dammam residence, shown “People were happy to have a job. They were happy to have housing. They were happy to say, ‘Oh yes, my father was with the U.S. Army or Bechtel or my father was with
a unique identity as “Aramcons.”
in 1965. The program, established
have an opportunity. There was a lot of pride in being employed with Aramco. The local com- Halliburton, and we lived three years here and two years there.’ But Aramco people
in 1951, offered interest-free loans
that gave thousands the opportu- munities took great pride in their relatives who worked in Aramco. Having a job at the company would come and stay 20 years. And that was unusual. That also became part of
nity to acquire their own homes. was considered a real asset for the community and the family.” this great family thing.
The oil boom of the 1970s spurred construction of additional homes and businesses in the
Dammam area. Many of the original owners of the Madinat al-‘Ummal homes retired and sold Naturally, new expat arrivals tended to identify first with where they came from, not
the homes to new owners looking for a place to start a family. The name of the neighborhood, where they were. Most employees who stayed with the company, however, soon came to think
however, remains as a testament to the pioneering Aramco homeowners. of themselves as company people. An important factor in the company’s identity was that top
management often lived next door to junior-level employees. Socializing often cut across boundaries
of rank and past corporate associations. The longer employees were in Saudi Arabia, the more
they thought of themselves as Aramcons, as opposed to having come from Socal, Texaco, Jersey,
Socony or companies not related to Aramco. Lawrence “Larry” Tanner joined Aramco in 1958
as a maintenance engineer and spent most of his 25-year career with the company in various
operations management positions in Ras Tanura and Abqaiq. He recalled: “When I arrived in Ras
Tanura I observed several social cliques. … In the early years these cliques were very coherent and
reluctant to accept outsiders. In the latter years, we were just all Aramcons.”
Exploration Continues Although the pace of facilities construction slowed compared with
An employee watches over the pump
control room at Safaniya in 1965. the previous decade, the 1960s witnessed a number of oil field discoveries, particularly offshore
During the year, the production in the Gulf. In 1963, Aramco geologists identified the Abu Sa‘fah offshore field. The following
capacity of the field was increased
by 150,000 bpd to more than 600,000
year, they located the Berri field, a portion of which extended under the waters of the Gulf. In
bpd, a gain that helped Aramco 1965, the Zuluf offshore oil field was discovered, and in 1967, Aramco geologists identified three
produce an average of more than
more offshore fields—Marjan, Karan and Jana. Aramco built its first offshore gas-oil separation
2 million bpd, an all-time high
at the time. plant (GOSP) 40 kilometers from Safaniya in the Gulf.
A drilling crew tightens the con-

nection between the drill bit
and pipe string on an offshore
platform in the Abu Sa‘fah oil field.
Discovered in 1963, the same year
the photograph was taken, the field
is located in the Arabian Gulf.
In 1968, Aramco found oil in an even more remote location. After decades of prospecting
amid the towering sand dunes in the Rub‘ al-Khali, beginning with Barger and his fellow geolo-
gists in 1938, Aramco geologists found oil. The Shaybah field was located in the northeastern
portion of the southern desert, 800 kilometers from Dhahran or more than a week’s drive since
there was no road to it. Given the challenges involved in producing and transporting oil in such
a harsh environment, and the abundant number of producing fields already online, Aramco
officials decided to pursue structure drilling in the area but to delay production indefinitely.
Ironically, some drilling took place to determine where there was not oil. In the late 1940s,
a r a m c o ’ s o i l f i e l d e x pa n s i o n
Aramco began relinquishing portions of its concession to the Saudi government as stipulated
Successful offshore exploration in the
in the 1933 and 1939 concession agreements. The company’s practice was to ascertain which
1960s expanded Aramco’s inventory of
portions of its concession had the least likelihood of yielding crude oil and return that territory marjan offshore oil fields from two—Safaniya
zuluf and Manifa—to eight. Portions of the
to the government in varying portions every few years. In the late 1950s and early ’60s, with Berri and Qatif fields lie offshore.
Aramco’s giant fields producing ever-increasing amounts of oil, a good portion of the company’s Though smaller than the earlier finds,
s a fa n i ya Abu Sa‘fah, Berri, Zuluf, Marjan,
drilling program was devoted to determining the next relinquishment. Karan and Jana together represented
The process accelerated in 1963, recalled Brock Powers, manager of Exploration in the early a significant increase in Aramco’s
proven reserves.
1960s. In March of that year, Aramco agreed to relinquish about two-thirds of its original conces-
sion, 588,720 square kilometers, leaving the company with roughly 323,749 square kilometers. m a n i fa
karan
The company also returned the remaining 108,357 square kilometers of the area where it had
preferential concession rights, or the areas outside the original concession where the company had
the right to forge additional concession agreements if it chose to do so. The remaining concession
jana
area was divided into six portions, with the largest, concession area No. 1, covering the major
a b u h a d r i ya
fields, residential compounds and facilities in the Eastern Province. The next largest, No. 5, was a k h u r s a n i ya h
horseshoe-shaped region in the Rub‘ al-Khali that included the Shaybah field. berri
fa d h i l i
The establishment of Seismic Camp
3 in 1966 marked the beginning ‘
a b u s a fa h key
of two years of seismic explora- known offshore oil
tion in the Rub‘ al-Khali, the most q at i f fields before 1960
inaccessible and inhospitable area
known offshore oil
explored by Aramco. For the first
fields after 1960
time, Aramco employed helicop-
ters in exploration work, leasing onshore oil fields
five Bell helicopters with motors
specially adapted to work in the dammam
extremely hot air of the region.
fa z r a n
abqaiq
‘a i n dar
As Time magazine reported:

Bowing to longstanding Saudi demands earlier this year, Aramco signed a new deal
with reform-minded Prince Faysal, who has replaced ailing King Saud as the nation’s de
facto ruler. Aramco agreed to pay the Saudis $160 million in retroactive extra royalties
[to settle the Sidon price claims] and to surrender in stages its original 673,000-sq.-mi.
Crew members in Seismic Camp 3
sit down to a meal in a mobile trailer concession, until all that will be left in 1992 will be a 20,000-sq.-mi. area. With the money
in May 1966. At any one time, about and the land, the Prince intends to set up a nationalized oil company. Aramco keenly
106 men called the camp home for up
to four weeks at a stretch. Their hard regrets losing its concessions but figures to keep its best oil producers and rationalizes
work paid off in 1968, when Aramco that the Saudis, by establishing their own oil company, should be under less pressure
discovered the Shaybah oil field 800
kilometers southeast of Dhahran. from fanatic nationalists to expropriate the American company.
Technology Transfer When King Faysal met with U.S. President John F. Kennedy in October
1962 while still Crown Prince, each appeared to see the other as a pragmatic reformer. Kennedy
sent a follow-up letter to the Crown Prince on November 2, stating that “under your firm and wise
leadership, I am confident Saudi Arabia will move ahead successfully on the path of modernization
and reform which you so clearly desire. In pursuing this course you may be assured of full United
States support for the maintenance of Saudi Arabia’s integrity.”
During their conversations, King Faysal accepted Kennedy’s offer to help Saudi Arabia
establish government television stations. The American president clearly understood the power
of mass communication and felt the Crown Prince could use the medium to benefit the Kingdom.
The U.S. Army Corps of Engineers took charge of contracting and installing television towers
and other support structures on land provided by the Saudi government. On July 17, 1965, First Saudi Managers
Saudi Arabian television went on the air in Jiddah and Riyadh, with two hours of programming
beginning after the sunset prayer. Initially, the programming featured readings from the Quran. By the 1960s, a handful of talented Saudis were rising rapidly through the ranks. Even
American entertainment programming and cartoons for children were added over time. Within though Ali Al-Naimi eventually became the first Saudi president and CEO, he was not
a few years, government television stations were operating in the Eastern Province as well. the first Saudi to be named manager. That distinction belongs to Zafer H. Husseini, who
had joined the company in 1952; in 1965, he was named manager of the Products
Roc k Wedn esday Arab-Israeli tensions concerning Palestinian refugees and other issues Distribution Department in Dhahran. Mustafa Abuahmad, who joined the oil company
mounted throughout the 1960s. Backed by the Soviet Union, Egypt was rapidly building up in 1944, became the second Saudi manager when he was put in charge of the Public
military strength in the Sinai Desert. Syria and Jordan were taking similar steps to the north and Relations Department in 1969.
east. Conflict seemed inevitable, and on June 5, 1967, Israel initiated what became known as
the Six-Day War. Zafer Husseini’s August 1965
appointment to the Products
Arab populations, including those in Saudi Arabia, presumed victory. For years they had Distribution Department made
listened to Nasser on Egyptian radio as he described Egypt’s military invincibility, and thus were him Aramco’s first Saudi manager.
Husseini, second from right, is
completely unprepared for the rapid defeat suffered by the Arab armies. Aware of America’s shown with, left to right, Paul
historic support of Israel, Arabs took to the streets across the Middle East, taking out their anger Arnot, W. Hodgeson, J. P. Lunde,
H. C. Kristofferson and Tom Barger.
on American government and business facilities. Some crowds were incited to violence by false
reports that American planes and ships had participated in the attacks on Arab forces.
A contingent of the Saudi National

Guard, sent to protect Aramco facilities
from crowds angry with America’s
support of Israel during what became
known as the Six-Day War, drives past
the Dhahran school in June 1967.
Fred H. Drucker, an Aramco attorney, met the crowd as he was driving toward the Admin-
istration Building a short while later:
By June 7, violence reached Aramco installations in the Eastern Province in the form of a mob, This was before there was a fence around the Administration Building, when the
made up primarily of students from the nearby College of Petroleum and Minerals. At company whole camp was pretty much wide open. I saw a crowd of people coming up the
facilities in Ras Tanura, Abqaiq and Dhahran, Arab workers that morning walked off the job en street toward me. At the same time I saw smoke in a couple of places, and I wondered
masse or simply did not show up for work. With President and CEO Barger out of the country on what was going on. As the crowd got closer I could see that they were turning over
vacation, Senior Vice President Robert Brougham, who a year later was named president, was and burning cars on the road that I was taking to the Admin Building. This got my
in charge. Aramco quickly shut down most operations. attention. So I turned to the right, and passed the house of Bob Brougham. Bob in
Like most Aramco executives in Dhahran, Brock Powers normally went home for lunch. For those days was the senior vice president of Aramco, and a good friend. There was
whatever reason, he ate his lunch at his desk in the Administration Building that day, giving him a crowd in front of his house. His big Cadillac convertible was being smashed with
a front-row seat as demonstrations in Dhahran turned violent: staves and shovels. I thought, “I’d better get back home.” So I turned into another
I was sitting at my desk over lunch time … that’s when ‘Rock Wednesday’ started. street where I was met by a crowd of demonstrators … they were not going to let
I was in the Main Office, looking out over the parking lot of the Administration met through. I could see they all had staves and ax handles and I thought that I’d be
Building. Here came this group of people, obviously angry, from the direction of the in trouble if I stopped. So I just kept on. I had an old Land Rover, and they smashed
college, CPM [College of Petroleum and Minerals]. They broke into the parking lot, the windshield and tried to hit me through it, but I kept going. That was the only
trashed some of the cars, and kept on going. violence I experienced in Arabia.
Bulldozers tow a drilling rig to a new crude oil reserves, which had been maintained for just such an occasion. In addition, other
position on the giant Ghawar field
in 1965. Three years later, Aramco oil-producing nations, such as Venezuela, stepped up production. Yamani later estimated Saudi
became the first oil company to Arabia’s loss for the 24 days of June in which the embargo was in effect at $30.2 million.
produce a billion barrels of crude
oil in less than a year.
Ironically, one reason the industrial countries were able to weather the 1967 embargo as
effectively as they did was a direct consequence of the 1956 Suez Canal Crisis, which involved
what was essentially a transportation embargo. The need for tankers to make even longer
voyages, highlighted by the Suez Crisis, sent shipbuilders to their drawing boards in the late
1950s. By the mid-1960s, a new generation of supertankers, which were seven times as large
as the typical tanker in 1956, was afloat. Six Japanese supertankers, each with a 300,000
deadweight-ton capacity, were ready for use in 1967 to ferry crude oil around the world.
Oil Glut The oversupply of oil by the end of the 1960s appeared to be bad and getting worse.
Major oil finds in Alaska and Libya and the likelihood of significant oil production eventually in
the North Sea were weighing on world markets. Baldo Marinovic, who had worked for Aramco
in the Treasurer’s Department in Dhahran from 1959 to 1961, returned in the fall of 1968 as
assistant treasurer to find a ghost town in the making: “I arrived in Arabia in September of 1968,
which was very close to the bottom of the oil cycle. There was a glut of crude oil, our production
was stagnating, the government was at the company’s neck to produce more to increase the
government revenues, the owner companies were telling us, ‘No, we can’t sell it,’ [and] we
had reduced the workforce down to almost a minimum.” For example, when he left Arabia in
1961, there were 1,808 American employees in Saudi Arabia. By 1969, that number had fallen
to fewer than 1,000.
Small fish picked up in shrimp nets

are returned to the sea by a crewman
aboard a trawler in 1966, a year in
which the firm he worked for increased
its capacity to clean and freeze shrimp
for export to the United States. Aramco
had provided technical assistance
and a loan guarantee to help launch
this Saudi business three years earlier.
A seismic exploration team sets off Eventually, the crowd left the oil compound at Dhahran and marched on the nearby U.S.
an underground explosion and records
Consulate. There they caused some minor property damage before being dispersed by the Dammam
the shock waves in the 1960s. The
data were used to create a diagram director of Public Security and a small group of policemen. There was no loss of life among the
of subsurface rock structures.
targets of the protestors or the protestors themselves, and the only injury on record occurred when
an Algerian student broke his leg while attempting to tear down an American flag at the consulate.
Still, many American families were severely shaken by the incident and were temporarily evacuated
to various sites in Europe at company expense over the next several days.
The Middle Eastern oil-producing states rushed to show their solidarity with Egypt, Syria
and Jordan. Even before the Six-Day War was over, Saudi Minister Yamani had instructed Aramco
not to ship oil to the United States or the United Kingdom due to their support of Israel. By June
8, the total flow of Arab oil from the Middle East had been reduced by 60 percent, with no oil
moving through the Suez Canal, Tapline or other pipelines stretching from the Gulf region to
the Mediterranean. Aramco’s oil production stopped completely from June 7–13, and the vast
majority of the company’s Saudi employees stopped going to work.
The selective embargo failed to do any significant damage, except to the income of
the oil-producing states themselves. U.S. and European officials worked closely, with a few
exceptions, to reroute tankers and otherwise allocate supplies. Production by American oil
companies, including Aramco’s owners, increased by nearly 1 million bpd, partly compensating
for the 1.5-million-bpd decrease in Saudi oil exports. The United States also tapped government
End of an Era The Tom Barger era at Aramco came to an end in 1969, when he stepped down Employees head home after a day’s
work in 1966. The large gateway
as CEO. Despite the convulsions around the world and in the Middle East, the government and was built to commemorate an earlier
Aramco continued to maintain fairly strong relations throughout the 1960s. Their comity was royal visit.
due at least partially to Barger’s close adherence to the guiding principles he elucidated in 1960,
the bedrock of which was his belief that strong relationships would keep the partnership stable
and allow both the Kingdom and the company to persevere.
Aramco President and CEO Tom Throughout his tenure, Barger distinguished himself as an oilman and as a skilled diplomat
Barger and Minister of Petroleum and friend to the Saudi people. From his earliest days in Saudi Arabia, he understood that extract-
and Mineral Resources Ahmed Zaki
Yamani examine a model gas injection
ing and moving oil was only part of the business. Most significant, his leadership was driven by
plant in Aramco’s Dhahran offices one powerful insight: Production is hard, but partnering is harder. As he rose to lead Aramco,
circa 1963. The two worked closely
together from Yamani’s appointment
Barger was convinced that the people side of the business would determine its eventual success
in 1962 to Barger’s retirement in 1969. or failure.
Barger was succeeded as CEO by Brougham (1969–1970) and Liston F. Hills (1971–1973).
Neither served in the post long enough to have a dramatic impact on the company. It was not until
Frank Jungers’s term (1973–1978) that another leader put his stamp on Aramco’s development.
As the 1960s drew to a close, the government pushed for more control over the oil business
and additional income from it to fuel development. But it also realized the importance of retain-
ing oil company expertise and ready access to Western markets. The relationship between the
Kingdom and Aramco was about to be dramatically transformed, reflecting those two goals.
26 energy to the world : Volume two boom time 27
chapter t wo
Boom Time
Ras Tanura, North Pier, 1970.

The 1970s proved to be a time when Aramco’s

ability to serve the interests of both its shareholders
and the Saudi government was strained almost
to the breaking point. A booming oil market
put more money in the hands of both entities,
yet left both eager for more.
Saudi Arabia sought to use its bounty to intensify development plans for the country. The boom
also prompted every Middle Eastern oil-producing country to seek ways to shift control of global
oil markets from Western oil companies to the countries that owned the commodity. Both of these
movements severely tested Aramco’s ability to deliver on its promises to its shareholders as well
as the government.
Frank Jungers, Aramco’s CEO from 1973 to 1978, was intimately involved in some of the most
dramatic events to shape Aramco as well as Saudi Arabia. Jungers was at the center of the decision-
making and implementation process, from the Saudi government’s push to obtain an ownership
stake in the oil company to operations during the oil embargo stemming from the October 1973
Arab-Israeli war. Jungers was also at the helm during the development of a system to capture, rather
than flare off, the natural gas produced with crude oil and use it to fuel domestic industrialization, as
well as the drive to integrate and enhance electric power generation in the Eastern Province. In fact,
he was so deeply imbedded in the integration of Aramco and Saudi Arabia that at times his actions
were at odds with the wishes of Aramco’s American shareholders. The mounting tension between One of Aramco’s most influential
executives, Frank Jungers served
the CEO and the shareholder-controlled board of directors played a major part in his decision to
as board chairman and CEO from
resign at the relatively young age of 51. Yet, despite his role in many events with a truly global impact, 1973 to 1978. Throughout his 30 years
with the company, he was a staunch
Jungers saw his tenure at the top of Aramco in more personal terms. “The development of Saudis
advocate for development of the
was my major accomplishment,” he said, “because that had a lasting impact.” Saudi workforce, and the policies he
implemented reflected those beliefs.
”Right Through the Roof” Brock Powers was sure he had made a mistake. He was in Aramco’s
New York office in late 1969, serving as liaison with the four shareholding companies. Occasionally,
Powers must have felt his full-time job was tracking the shareholders’ changing monikers, as
The early 1970s saw global oil
demand turn sharply upward, The Texas Oil Company was renamed Texaco (1959), Socony Vacuum started calling itself Mobil
prompting Aramco to increase (1966) and Standard Oil of New Jersey became Exxon (1972). If he had stayed long enough, he
its crude oil processing capacity,
including that of Abqaiq, shown could have been on hand for the creation of Chevron (1984), formerly Standard Oil of California.
here. But part of his actual job was to gather the advanced two-year “nominations,” or projections of
the amount of crude oil each company required per calendar quarter. For U.S. antitrust reasons,
each shareholder had to submit its sealed numbers directly to Aramco. When Powers totaled
the 1969 numbers, the result was astonishing: “I couldn’t believe it. The nominations were right
through the roof. They were astronomical, compared to the base we were operating on … so I
called everybody back and they all confirmed them, and that’s what they wanted.”
For the previous few years, Aramco’s annual capital budget (spending on equipment and In 1970, U.S. oil production reached a level never to be attained again, peaking at 9.63
construction projects) had been roughly $40 million. Powers was among the first of Aramco’s million bpd (nearly three times Aramco’s average daily production of 3.5 million bpd). At the
executives to realize that the company was about to enter a new boom era. But he knew that same time, U.S. oil consumption was 14.7 million bpd, accounting for 31.4 percent of global oil
an extraordinary increase in demand could not be met by a few simple turns of the global oil consumption. In response to the domestic supply-demand gap, U.S. President Richard M. Nixon
spigot. This would not be a spike, a mere hiccup along an otherwise comfortably modest incline relaxed import controls. Nixon’s advisers determined that the need for additional oil trumped
in demand. If the news on Powers’s desk was right, this “spike” might last for decades. And long concerns about political instability in the Middle East, despite mounting Israeli-Palestinian tensions
before Aramco could enjoy its swelling coffers, there would be more immediate consequences, and the administration’s widely perceived pro-Israel slant.
and they would be painful. He made his case at the next Aramco executive committee meeting:
I laid out what it meant in terms of [the] cost that was going to come about as a Expansion Mode The company shifted into expansion mode in a manner of months, marking its
result of this, and do you guys really want us to gear up to do this? It means hiring lots most dramatic commitment of resources since the end of World War II. In 1971, Aramco produc-
of people. It means building lots of facilities that we don’t have on the ground now. tion jumped 27 percent from the previous year, to 4.5 million bpd. Adding or expanding GOSPs
It means a capital budget of billions of dollars a year. And they all agreed they were increased production capacity by 700,000 bpd. Two GOSPs were completed in the Shedgum
going to go ahead with it, because they were very parsimonious, and they weren’t area and one in the ‘Ain Dar area. The second million-barrel crude oil storage tank was completed
going to build anything that they didn’t need. in Ras Tanura. And delivery capacity at the Ras Tanura Terminal increased 18 percent with the
A supertanker loads crude oil at Ras
installation of another loading system between the tank farm and Sea Island. Tanura’s offshore Sea Island Terminal
As the 1970s began, Aramco’s admin- Walter Dell’Oro, a superintendent in Exploration and Operations at the time, recalled that in 1967. The terminal began operations
istration buildings and adjoining with two berths in 1966, opened two
residential areas in Dhahran rapidly
the crash building program of the 1970s led directly to Saudi Arabia’s serving as the “swing more berths the following year and
filled to bursting with workers and producer” in world oil markets from that period onward: added another two berths in 1969.
their families as an oil production and
building boom gathered momentum.
In 1975, the year this photo of the
company’s headquarters in Dhahran
was taken, the workforce had
expanded more than 21 percent
over the previous year.
Just how unexpected was the demand surge represented by the shareholder nominations
can be seen by comparing them to corporate studies prepared for Aramco management. The
1970 forecasts estimated a rise in production, albeit a gradual one—gradual enough, in fact, to
be easily handled while continuing the company’s plans to reduce its in-country payroll. These
forecasts predicted that over the next 10 to 15 years, Aramco could cut its workforce by at least
40 percent, due mainly to automation and better training. The report predicted the number of
workers would fall from the already low level of nearly 11,000 in 1970 to just 6,000 a decade
later, with a mere 400 Americans on the payroll.
Powers was right: The corporate studies were, for the most part, wrong. Global demand
for crude oil in the early 1970s was triggered by relatively robust economic growth in the United
States, Europe and Japan following years of limited investment or even underinvestment by
Aramco and most other oil companies. That combination resulted in the biggest oil boom since
the postwar surge in the late 1940s. A Gulf Oil memo written in March 1970 noted that Gulf’s
1968 estimates of oil demand in the West were running 8 percent below actual consumption.
The memo warned, “If once again our estimates of future free world demand prove low, then a
strain on productive capacity may be approached before 1980.”
Since Aramco had a superabundance of oil in the ground with more than adequate Farewell to Tapline
oil pressure, the bottleneck was in the surface facilities. If someday Aramco wanted
to double production for a month or two to offset a disruption in the world oil supply Tapline once played a critical role in Aramco’s oil infrastructure, transporting half a
in some other part of the world, it could be done in a matter of days if the surface million barrels of oil a day from the oil fields of Saudi Arabia’s Eastern Province to
facilities were in place. the shores of the Mediterranean, thus avoiding both the circuitous route around the
Cape of Good Hope and the expense of the Suez Canal. Advances in technology
A company with enough spare capacity to dramatically increase production to meet a in the 1950s and ‘60s made possible the construction of larger ships capable of
shortfall is called a “swing producer.” The extra investment in surface oil facilities can be paid carrying substantially more oil, however, making the seaways more economical
off rapidly as oil prices tend to skyrocket when there is a shortage. and causing Tapline to fall out of favor.
Oil industry experts estimated in 1972 that there was a “cushion” of only a scant half-million Tapline’s use further declined as repeated conflicts wracked the region and left
barrels of oil between global supply and demand. Over the next few years, Saudi Arabia assumed the pipeline vulnerable to sabotage and jeopardized its reliability. In addition to these
the de facto role once held by the United States as the world’s swing producer of oil—a position problems, Tapline also had to contend with the Syrian government, which occasionally
the country retains to this day. The Saudi share of world oil exports rose from 13 percent in 1970 demanded higher fees to allow oil to flow through the pipeline within its territories.
to 21 percent by 1973. In 1975, the Lebanese civil war forced the evacuation of Tapline personnel from
The construction and production surge continued unabated. Aramco laid nearly 1,300 its corporate headquarters in Beirut. With no sign of stability in Lebanon on the
kilometers of pipeline, drilled roughly 1,000 wells and built 24 GOSPs, and by 1974, average horizon, Tapline decided to close down. In 1978, Tapline officials began negotiating
crude oil production had soared to 8.2 million bpd. the termination of its operating conventions with Lebanon, Syria, Jordan and Saudi
Arabia. By 1983, oil no longer flowed through the pipeline to Sidon. A small
A combined crew of Tapline and oil
A gas-oil separation plant (GOSP) amount of oil continued to flow to a refinery in Zarka, Jordan, but with the advent tanker personnel hoist submarine
is lifted into position in the Marjan crude oil loading lines aboard ship in
offshore oil field in 1973, part of of the Gulf War in 1990, that, too, was stopped. That was, in effect, the end of
July 1961, an action repeated thou-
Aramco’s capital projects program Tapline. Today, all of Saudi Aramco’s oil exports flow through marine terminals sands of times over the life of the
that increased offshore oil process- Tapline terminal at Sidon, Lebanon.
ing capacity by 1 million bpd. In on the Arabian Gulf and the Red Sea to tankers that travel either east to Asian
addition, eight onshore GOSPs, with markets or west through the Suez Canal or around the Cape.
a combined capacity of more than
2 million bpd, were constructed in
the first nine months of the year.
Help Wanted To support this increase in production, Aramco’s employment effort shifted into
overdrive. The company opened employment offices across Saudi Arabia and in several other
countries. Mustafa Abuahmad, director of the Employee Relations Department during the early
1970s, was exaggerating only slightly when he said, “We were hiring everybody, everywhere.
Americans, Filipinos, Indians, many Saudis.” The demand for qualified labor can be seen in the
company’s size and demographics from the period. In 1971, Aramco had 10,107 employees, 82
percent (8,324) of whom were Saudis; five years later, the number of employees had almost
doubled to 20,067, but only 74 percent (14,837) were nationals.
With the oil boom, working for Aramco suddenly took on greater prestige among ambitious
high school and college-aged Saudis. When he was entering high school in Dammam in the
late 1960s, Abdulaziz F. Al-Khayyal, Saudi Aramco’s senior vice president of Industrial Relations
since September 2007, assumed he would follow in his father’s footsteps and pursue a career in
government service. That was where the prestigious jobs were for ambitious Saudis, he reasoned.
By the time he was in college at the University of California, Irvine, where he earned a bachelor’s
degree in mechanical engineering in 1977 and a master’s degree in business administration in
1979, that notion was beginning to change:
The transformation happened in about ’73 or ’74 with the first energy crisis and
then the expansion, the big expansion. … Aramco went out trying to recruit and the
story began to change. But up to that point Aramco was viewed as having limited
employment opportunities. They were not viewed as terribly excited about paying
professional salaries. They had a program for professional Saudis, but it was limited
in scope and most of the people said that Aramco was not the place to go work.
Aramco’s computers, such as the

Project Management
Project Management Department’s
IBM shown in this 1970 photograph,
were used for numerous tasks, from With capital budgets soaring in the early 1970s, Aramco management saw the need
processing complex seismic data to
tracking basic payroll information. for greater coordination among departments working on major projects. Project design
was being done in The Hague in the Netherlands, or London in the United Kingdom, for
example, while construction was going on in Saudi Arabia. Officials involved in each
activity tended to blame the other when a project slipped behind schedule or over budget
or both. Ed Zinola, senior vice president of Engineering Services, embraced the concept
of centralized project management, which was becoming increasingly popular in the
United States. In 1972, he named Henry “Hank” Barracano, supervisor of the Electric
Power Unit, Aramco’s first project manager.
Additional training programs were put in place for Aramco and its ancillary contractors,
but both struggled to keep up with the flood of new hires. From 1970 to 1975, the number
of trainees in Aramco’s Industrial Training Centers jumped from 1,000 to 5,500, although the
number of instructors merely doubled. Some locations ran double shifts of classes, and teachers
found themselves on their feet for 10 hours a day without relief. Ali Dialdin, then staff adviser for
Aramco’s out-of-Kingdom training and later general manager of Training and Career Development,
opened two temporary training centers in Egypt, historically one of the Middle East’s biggest
exporters of educators. But Dialdin soon discovered that even in other countries Aramco’s demand
for teachers could not be met.
Unimaginable Scale The scale of Aramco oil operations, already enormous by any measure, The appointment of a project manager did not stop the arguing, “but they would Aramco’s implementation of
increased almost exponentially. Frank Fugate, who oversaw company construction projects in the centralized project management in
go through me … then I could kick these guys” to get them to take corrective action
the 1970s allowed it to more effi-
early 1970s and eventually rose to become a senior vice president in the company, recalled that when necessary to keep projects on track, Barracano said. The first project completed ciently complete numerous capital
“the capital program went from $40 million to $450 million, and it got up to about $5 billion a improvement projects, including
on his watch was the 600,000-bpd Berri crude project in 1970. “I moved to London,
the Qurayyah Seawater Treatment
year with a backlog, as I recollect, of about $7 billion. We had to get the people in and get the where the design was being done by Fluor, to oversee design and procurement. Then Plant, shown here in 1979.
construction camps going. We went to suppliers and bought space in their shops for a year. We when that was fairly well done, I moved back to Arabia. Even though that was the first
went to pump shops and bought their entire capacity for a year.” one, it came in on time and in the money. I’ve always been proud of that,” Barracano
To take just one example, the production capacity of the giant Safaniya offshore field grew added. Project management played an increasingly vital role in the ensuing decades
dramatically, from 200,000 bpd to 1.5 million bpd. On this and similar jobs, everything the engineers as the company took on and successfully completed construction of several oil and gas
and construction crews thought they knew about the scale of oil industry work was tossed out facilities that set new standards for the industry.
the window. Barges were laying pipelines to the offshore field at the same time offshore rigs King Khalid, left, cuts the ribbon
on October 29, 1977, to open the
were drilling new wells. Giant pumps were installed to move the oil onshore for processing. The Berri NGL Center while Minister of
installation was bigger than anything ever done in the oil business. For economies of scale, two Petroleum and Mineral Resources
Ahmed Zaki Yamani and Aramco CEO
giant pumps took the place of 10. To avoid maintenance shutdowns, a third giant pump was Frank Jungers look on. The first of the
ordered and kept on standby. Master Gas System plants to open,
the Berri NGL Center supplied treated
Aramco was redefining the state of the art in oil field facilities on a real-time basis. In most gases as fuel and chemical feedstock
cases, the only limitation on the company was availability of materials in the market—what it to the industrial complex at Jubail
and natural gas liquids for export.
could find and whether manufacturers were willing to rethink their production processes to
accommodate Aramco’s specifications regarding size and/or quantity. The company also kept
several computers busy running “what if” scenarios to ensure that construction stayed on schedule
if, for example, the shipment of a particular component was delayed.
The limited capacity of Dammam Port became a bottleneck for the inflow of additional
equipment and supplies, especially as the revenue generated by the oil boom spurred rapid
development of other Saudi industrial and construction projects. To avoid congestion, Aramco
adapted by lightering in material from outside the existing port areas and using heavy cranes to
lift the equipment onto waiting trucks for delivery.
Barge 136, nicknamed the “Queen

The F. A. Davies Mary,” supplies a drilling platform
in the Safaniya field with power and
drilling mud in 1971. Between 1970
Aramco had discovered the Marjan and Zuluf offshore fields prior to the oil boom of the and 1971, crude oil production rose
27 percent, propelling Saudi Arabia
early 1970s, but the company had not fully determined the fields’ size. Rather than commit to
into third place among oil-producing
building an expensive offshore pipeline or wait until additional survey work helped delineate nations behind the United States
the fields, Aramco engineers decided to adapt an approach that one of the company’s and Russia. The following year, crude
oil production increased another
shareholders, Exxon, had used in the offshore oil fields of Nigeria. In this system, as adapted 27.5 percent.
by Aramco, oil from the new offshore Zuluf GOSP would move through underwater lines to
a floating storage vessel 64 kilometers offshore, where tankers could then take on crude oil.
Robert Luttrell, superintendent of the Safaniya Producing Division, was put in charge
of the project, which, as was typical of such large-scale affairs, involved Aramco staff and
contractors around the world. He visited the Exxon facility in Nigeria, huddled with Aramco’s
With the Zuluf offshore field engineering and design staff in The Hague and then flew to Japan with an Exxon maritime
entering production in 1973,
captain to purchase a tanker. The vessel they bought in Nagasaki had a capacity of 1.8 million
the F. A. Davies, a converted
oil tanker, served as a floating barrels of oil—far larger than the tanker Exxon had used in Nigeria. The ship had to be
storage vessel.
modified for its new role, and its living quarters were enlarged. The project also required
two single-point moorings: one to deliver oil to the floating storage vessel and another,
1.6 kilometers distant, for tankers taking on oil. (Single-point moorings were also used
at Ju‘aymah Offshore Terminal, which opened in 1974 north of Ras Tanura with an
initial capacity of 1 million bpd.)
Finding a crew to operate such a novel craft proved to be more difficult than Aramco
officials had expected. They eventually retained a British crew from well-regarded providers
Common Brothers to run the vessel but not without having to modify the typical Aramco
operating contract. The crew demanded an “out” clause after a certain period in case
Aramco’s creation proved to be a failure. “They didn’t want to ruin their reputation [by]
being involved in something that didn’t work,” Luttrell recalled with a chuckle.
The Common Brothers need not have worried. The F. A. Davies (named after Fred
Davies, Aramco’s influential early CEO) worked flawlessly. In 1976, Aramco began building
a second offshore GOSP in the Zuluf field to process increased production. By the 1980s,
Aramco decided the size of the Marjan and Zuluf fields warranted the construction of
a pipeline connecting them to onshore oil processing facilities. The F. A. Davies was then
reconfigured and added to Aramco’s tanker fleet.
“The Buyer’s Market for Oil Is Over” As the 1970s began, Aramco’s shareholders and the Strings of drill pipe stand ready on a
drilling rig at Tamayshah in the Rub‘
other major global oil companies held to the position that they remained in control of oil prices. al-Khali in March 1979. This was a test
OPEC had been in existence for a decade, and had little to show for its speeches and conferences. well in the Khuff zone at 3,471 meters
and part of Aramco’s accelerated gas
Saudi Minister Yamani was frustrated with OPEC’s lack of cohesion and in 1968 led the formation exploration program in the 1970s.
of the Organization of Arab Petroleum Exporting Countries (OAPEC), which initially included
Saudi Arabia, Kuwait and Libya. The purpose of OAPEC was to give leading Arab oil producers
more control over their fate.
Jungers, Aramco’s chief negotiator with the government since 1965, recalled riding on a plane
with Yamani in early 1970. The price of oil was $1.80 a barrel, almost the exact price it had been
a decade earlier. However, when adjusted for a decade of inflation (which averaged 2.75 percent
annually), the $1.80 barrel of crude in 1970 was worth much less than its 1960 equivalent. For
members of OPEC, Yamani complained, real income had actually declined over that period.
With the demand for oil rising sharply, Yamani argued for a 9-cent-a-barrel increase, saying
that he could get the rest of OPEC to hold prices at that level if Aramco’s shareholders went
Japanese brokers signal “buy”
along. If the other countries raised prices first, there might be no controlling the rate of increase,
at the Tokyo Stock Exchange on Yamani warned. Jungers personally agreed with him but had to pass along the request to the
December 27, 1973, as reports
circulate that the Arab oil supply
shareholding companies. The Aramco shareholders refused, and months of meetings followed.
cutbacks against Japan will ease. Nerves frayed and tempers flared occasionally on both sides as the standoff continued.
Petroleum Company had agreed to higher prices, breaking the oil industry’s united front. Other
independent oil companies and the major producers followed suit, raising the posted price of
Libyan crude 30 cents a barrel to $2.53 a barrel and paying higher taxes as well.
The Aramco shareholders and other international oil companies felt the world shifting
beneath their feet. They began meeting in groups (joined by a U.S. government representative
to avoid antitrust concerns) to discuss options and hammer out common policies. Meanwhile, the
Shah of Iran hosted a showdown of sorts between oil-producing countries and the oil companies
themselves in early 1971. Representing the Arab producer states were Yamani of Saudi Arabia,
Iraqi Oil Minister Sa‘doun Hammadi and Iran’s Finance Minister Jamshid Amouzegar. Representing
The first OPEC country to initiate a price hike was Libya, which began pressing for higher the other side was the Group of 23, consisting of 16 U.S. companies, six Western European firms
prices in early 1970. It argued these were justified because of the low sulfur content of its oil, and one Japanese concern. Speaking for the Group of 23 was George Piercy, Exxon’s director
which made it easier and less expensive to refine than many other grades of crude oil. A further responsible for the Middle East, and William Fraser, a BP director and attorney.
argument was its proximity to Europe, a factor that became all the more pertinent when, in May After weeks of negotiations, representatives from the two sides finally signed the Tehran
1970, Aramco was forced to halt all shipments of oil through Tapline after it was damaged in Agreement on February 14, 1971. It stipulated an increase of 35 cents a barrel for light crude
Syria, thus increasing European reliance on Libyan oil. In June and August of 1970, Libya imposed and 40 cents a barrel for heavy crude from the Arabian Gulf. (Crude oil is classified according to
output restrictions on foreign oil producers, and by September, American-owned Occidental density, or specific gravity. The lighter the crude oil, the more valuable products it yields when
refined.) Furthermore, to account for inflation, the price of a barrel of oil would increase by 5 Since the late 1960s, Yamani in particular had advocated the Saudi government’s position
cents a year for the following four years, as well as another increase of 2.5 percent a year for the of participation, with producing nations acquiring ownership while preserving the oil trading
four years after that. Finally, the oil-producing countries’ percentage of company profits would and marketing structures. That stance enabled him to better resist calls for nationalization by
increase from 50 percent to 55 percent. The accord raised the price of Arabian Light to $2.17 a aggressive oil-producing states. Jungers recalled: “Participation was Yamani’s avowed idea
barrel and the price of Arabian Heavy to $2.125 a barrel. that the government would buy into Aramco and become a true participant and thereby get to
This agreement has been interpreted in many ways over the years, but one thing is certain: know the shareholders’ problems intimately. Through this method, the Saudis would become
Oil-producing countries gave the oil companies a very fair deal. The oil-producing countries a shareholder and fight off the rest of the producing governments, who were hell-bent to
needed this hefty adjustment to counter years of rapidly increasing inflation, which averaged nationalize.”
5.92 percent in 1970. Furthermore, even setting inflation aside, these countries simply needed Aramco tried to control the participation debate, with Jungers at one point in 1971 floating
to play catch-up with price developments elsewhere in the world. For example, the price of a the idea that the Saudi government could participate in 50 percent of the profits from new fields
barrel of American domestic crude, which was protected from cheaper foreign oil by U.S. import developed after that point, rather than take an ownership stake in the entire company. Yet while
quotas, increased by 45 cents in 1969–1970 alone. Aramco was dragging its heels on participation, varied forms of nationalization were gaining traction
While the Shah of Iran and others hailed the agreement as ushering in a new era of price elsewhere. In 1971, Algeria dispensed with further negotiations and took 51 percent ownership
stability, few oil company executives shared their enthusiasm. As Shell Oil Company Chairman of the French oil operations in its country. The following year, Libya nationalized BP’s holdings and
Japanese-made cars bound for world David Barran remarked following the Tehran meetings, “There is no doubt that the buyer’s market later took 51 percent control of other foreign operators, including Occidental. Iraq also nationalized
markets crowd a pier in the port
of Yokohama in March 1975. One for oil is over.” the Kirkuk concession, the last remaining holding of IPC.
aftereffect of the 1973 oil embargo Yamani seemed to despair, feeling that the Aramco shareholders were not getting the
was the rise of smaller, more fuel-
efficient cars. The United States set
Participation Even while negotiating with the oil-producing states over raising prices, the oil message. “There is a worldwide trend toward nationalization and Saudis cannot stand against
fuel efficiency standards for new cars, companies in 1971 continued to resist discussing an even more daunting matter: the groundswell it alone,” he warned. “The industry should realize this and come to terms so that they can save
mandating a doubling of average
among producing nations in favor of direct participation in the ownership of the oil companies as much as possible under the circumstances.”
mileage from 13 miles per gallon
to 27.5 within a 10-year period. themselves, if not outright nationalization. By 1972, the Saudi Minister had finally convinced some members of OPEC to push for a
united front on participation. Yamani described it as the best way to give oil-producing countries
ownership interests while maintaining a strong pricing structure for OPEC. He argued that
widespread nationalization would inevitably lead to cutthroat price competition, as countries
gave in to domestic pressures to maximize oil revenues as soon as possible. As early as 1969, he
had argued that nationalization would trigger a “dramatic collapse in the pricing structure” as
producing nations pumped more oil to meet revenue targets in the face of declining prices.
The major foreign oil companies operating in the Arabian Gulf, seeing no alternative by early
1972, reluctantly agreed to engage in serious participation talks with governments in the region.
Aramco’s legal staff decided to get out in front of other companies and draft a participation
agreement. Aramco General Counsel Bill Owen turned to one of his assistants who specialized
in tax law, Leslie Lewis, with what would be one of the biggest assignments of his life. “Les,”
Owen said as he walked into Lewis’s Dhahran office one day in early 1972, “I’ve chosen you to
be my right arm, and you and I are going to produce the first draft of the agreement relating to
participation. … At the first meeting with the shareholder company counsel we will table the
first draft, and you’re going to write it.”
The negotiations took place during the spring and summer of 1972. A group of 100 to
150 attorneys, accountants and oil industry experts followed the globe-trotting Yamani as he
convened meetings at hotels and conference centers around the world to thrash out the details
of participation. The longest sustained set of negotiations occurred at Beit Meri, a summer resort
in the mountains of Lebanon.
By October 1972, the negotiations had borne fruit. The General Agreement on Participation,
which was based on Lewis’s draft, granted 25 percent participation to the countries. The pact
was agreed to by the oil companies and signed by Saudi Arabia and Abu Dhabi in Riyadh on
December 20, 1972 (with Saudi television capturing the moment), effective January 1, 1973.
Kuwait and Qatar signed the agreement the following month.
Saudi ownership reduced the percentage held by the four existing shareholders, with Exxon,
Texaco and Chevron now owning 22.5 percent and Mobil 7.5 percent. Ownership participation
was supposed to incrementally increase to 51 percent by 1982, in what both sides anticipated
would be a relatively stable process in terms of maintaining prices and transferring ownership.
That, at least, was the plan.
The Producers Take Control Arab-Israeli antagonism seemed to intensify week by week in amicable price negotiations were inflamed by war fever. OPEC was demanding a 100 percent
the early months of 1973. Arab spokesmen—particularly Palestinians—pressed Israel to relin- increase, from roughly $3 to $6 a barrel, in the posted price of crude oil. The companies were
quish territory gained in the 1967 war. Ever-tighter supplies in the West drove oil prices higher, offering what, until the outbreak of war, had sounded to them like a more than fair 15 percent
highlighting Western reliance on imported oil, especially Middle Eastern oil. Understanding increase of 45 cents a barrel.
their obvious advantage, some oil-producing countries increasingly threatened to use the “oil After no acceptable counteroffers came out of the Vienna meeting, negotiators from
weapon”—an embargo. The Saudi government made it clear to Aramco officials and American Arab OPEC countries and Iran reconvened in Kuwait City on October 16. There, they unilaterally
politicians that the situation was making it increasingly difficult to moderate the influence of raised the posted price 70 percent to $5.11, which was roughly in line with the panicked spot
other regional governments indefinitely. As spring gave way to summer, the situation grew market prices. Despite the ongoing war, the significance of the OPEC price hike—and the bold
progressively worse, as recounted by noted Arab authors M. S. Daoudi and M. S. Dajani in their unilateralism reflected in the manner in which it was presented—were felt around the world.
book, Economic Diplomacy: Embargo Leverage and World Politics: The oil producers were clearly in control.
On May 3 [King] Faisal confided to Aramco president Jungers that only in Saudi
Arabia were US interests relatively safe, but that even in his Kingdom it would be
more and more difficult to hold off the tide of opinion. And in August meetings with
Aramco executives, the King began requesting that the US government pressure the
Israelis to withdraw from the bulk of Arab territories occupied in the 1967 war.

In the meantime, the participation agreement was already looking shaky, as the more radical
Arab governments began to scoff at the 25 percent participation rate championed by Yamani.
Libya, true to form, acted first and in early September 1973 nationalized 51 percent of Exxon’s
Esso Libya operations. More uncertainty meant higher prices in the spot market for immediate
delivery of crude oil. (The spot market at the time reflected the small amount of oil trading
that existed outside the long-term agreements between oil producers and oil distributors.) On
September 11, 1973, a barrel of Arabian Light was $3.06 a barrel, up from the $2.17 per-barrel
price set by the Tehran Agreement the previous February.
Jungers, with the blessing of Aramco’s four shareholding companies, made a whirlwind tour
of the United States to promote a more balanced approach by America to the Arab-Israeli crisis. The
conflict continued to fuel hostility toward America and American companies in the region. Jungers’s
focus was the broader U.S. business community, not just those industries directly tied to energy.
Crisscrossing the country in a matter of days to press his case, he met with 38 CEOs of major U.S.
companies. After hearing his argument, a number of major companies backed his position.
Several oil company executives spoke out against American and Western support for Israel.
At an address before the Independent Natural Gas Association of America in Scottsdale, Arizona,
Maurice Granville, chairman and CEO of Texaco, called for a “more even-handed policy” regard-
ing the Arab-Israeli dispute: “We must feel concern when those who have been so close to us
urge us to review our policies. When such long-time friends assert that we are not being fair and
even-handed, it seems only sensible to pause and examine the actions about which they express
concern. … To dismiss without some concern the viewpoint of those who feel wronged is to neglect
a significant aspect of the nation’s energy policy.” Granville was not alone; Mobil Oil took out a series
of advertisements in The New York Times to press the matter. Otto N. Miller, Socal’s chairman, had
denounced America’s stance six weeks earlier in his July 26, 1973, letter to shareholders, calling for
a greater understanding of “… the aspirations of the Arab people, and more positive support of The following day, the oil-producer representatives rejected a call from the Iraqi representa- Drivers in the United States, such as
this motorist in Connecticut, faced
their efforts toward peace in the Middle East.” Miller and his company received a lot of flack from tive to nationalize all American businesses in the Arab world. After Iraq’s representative stormed
shortages of gasoline in the wake of
the American media, and protests took place outside Socal’s headquarters, with some protestors out in protest, those remaining agreed to an embargo, the first since the 1967 war. They agreed the OPEC oil embargo. The embargo
also impacted consumers in Western
even attempting to storm the building. But Socal stood its ground. to cut production 5 percent from September levels and to continue to cut output by 5 percent a
Europe and Japan, and was a pivotal
Jungers returned to Saudi Arabia after his trip and was debriefed by King Faysal. The King month until major oil-consuming countries stopped supporting Israel. Some countries immediately moment in the relationship between
wanted to know every detail, especially the response from the American business leaders. Both oil companies and producing nations.
doubled their first month’s cut to 10 percent.
of them expected the issue to be taken up again at the next OPEC meeting, scheduled for early President Nixon’s announcement of a $2.2 billion military aid package to Israel on October
October in Vienna, Austria. 19, following resupply shipments by the Soviets to Egypt and Syria, led the Arab oil producers and
As oil company executives arrived there on October 6, 1973, they heard the news: Egypt Iran to declare a total embargo on oil shipments to the United States. The Netherlands, also an
and Syria had launched a coordinated surprise attack on Israel during the Jewish holiday of Yom active supporter of Israel, received the same treatment. Shipments to other countries in Western
Kippur and had scored impressive early gains. What the oil executives had hoped might be Europe and to Japan were also reduced in response to their support for Israel.
As the embargo took effect, Jungers and other Americans working for Aramco faced the Students gather in the courtyard of
the women’s campus of Jiddah’s King
most crucial decision of their professional lives. Critics in the United States were calling them Abdulaziz University in 1973. Founded
traitors for complying with the embargo that was contrary to the interests of their country. in 1967 by a group of businessmen,
the university was absorbed into
Several members of the U.S. Senate Subcommittee on Multinational Corporations blasted the Kingdom’s university system
Aramco. Senator Henry M. Jackson of Washington state claimed Aramco’s adherence to the in 1971. The school opened with a
handful of students, but by the time
embargo was a “flagrant case of corporate disloyalty.” this photo was taken, total student
Senator Jacob K. Javits of New York accused the oil company of cooperating with the enrollment was around 2,500.
Saudis to increase the profits of its shareholder companies: “Obviously, it is to their [the Arabs’]
interest to raise prices. They determine even your profit. They determine how much of the deal
you may own. And yet what they are doing imperils this country and this world. … The only
persons talking to these governments are companies who have their own profits, their own
stockholders and their own private interests to protect. That is an impossible situation.”
Aramco denied all the charges. The company declared that its actions were motivated by
expected reprisals by King Faysal. Aramco was obviously worried that it would be cut off from
its only source of crude oil. According to its statement, Aramco “had no choice but to follow
instructions regarding cutoff on deliveries to the U.S. military of products manufactured from
Saudi Arabian crude. … The embargo action was taken by a sovereign state and Aramco’s
compliance came as the result of a direct order and had nothing to do with ‘patriotism.’”
As its payroll grew to fill the man- Jungers was convinced that if Aramco did not cooperate with the Saudi government,
power needs of the Master Gas System, nationalization of the oil company was a foregone conclusion. Furthermore, he feared nationaliza-
Aramco built new communities
and revived older ones, such as
tion would remove any American influence on Saudi oil policies, putting American security on
A science lab experiment commands
‘Udhailiyah. Shown here in February even shakier ground: “We knew exactly where every barrel of oil that was exported went, and the attention of students at King
1977, the isolated camp, located 100 Abdulaziz University in 1973. A
kilometers southwest of Abqaiq,
monitored it. This was under threat of complete nationalization. There was no doubt about this.
donation in 1973 from Aramco
had been mothballed since 1959. And we did it in lieu of being nationalized. We had no choice.” helped finance the construction of
a library on the women’s campus.
Majority Stakes The embargo also sounded the death knell for the participation agreement,
even though it was less than a year old. In December 1973, Kuwait, whose parliament had never
While some in the United States raised the possibility of military intervention if the embargo ratified the 25 percent participation agreement, announced plans to assume 60 percent ownership
turned into a stranglehold on the U.S. economy, cooler heads prevailed behind the scenes. The of Kuwait Oil Company, which was jointly owned by Gulf Oil and BP. That same month, Yamani,
embargo, while relatively short-lived, reverberated through world economies and politics for years at a meeting in New York, was quoted in BusinessWeek as saying that 51 percent participation
to come. From October 1, 1973, to January 1, 1974, the price of a barrel of Arabian Light crude was “not satisfactory.” The magazine added, “In London, the center for Middle East oil watchers,
soared from $3.01 to $11.65. That previously unimaginable $8 jump in oil prices followed three the betting is that Faisal will eventually demand 100 percent ownership.”
decades of oil price fluctuations in a relatively narrow band above or below $2 a barrel. The U.S. Saudi government participation in Aramco under an OPEC agreement went to 60 percent
role in brokering peace talks among Israel, Egypt and Syria contributed to the decision to lift the the following year, in 1974. The government thought it was a reasonable compromise under the
embargo in January 1974. circumstances, as other OPEC members were pressing for complete nationalization immediately.
The Saudi government’s majority stake in Aramco as of 1974 made little if any immediately Sharing Success
noticeable impact on the lives or careers of expatriate workers. Despite false scare stories that cropped
up periodically in the U.S. media during the next few years warning that mass firings of Americans Khalid Ali Alturki, back row, far
right, departed Saudi Arabia in
by Aramco were imminent, the expatriate communities worked and lived much as they had before.
July 1960 on an Aramco scholar-
The government, and Yamani in particular, made it clear Saudi Arabia valued the expertise that expatri- ship to an out-of-Kingdom
ate workers brought to Aramco and that they were a key ingredient in the company’s success. college. The 10 other students
pictured are, front row, left to
right, Ibrahim A. Al-‘Afaleq, Salah
“True Saudization” When Jungers was named chairman and CEO in late 1973, he quickly realized A. W. Ghanim, ‘Abdal-‘Aziz Al-‘Abid,
Saleh A. Al-Tu‘aimi and ‘Abd Allah
the pace of training Saudis for progressively more senior positions at the company had fallen behind Al-Faisal, and back row, left to
expectations he and others had set at the departmental level in the 1960s. A 1972 study delivered to right, Nassir M. Ajmi, Abdul Rahim
Framarzi, Ni‘mah S. M. Al-‘Awwami,
Aramco management concluded that at the then-current rate, just 28 percent of Aramco executive ‘Abd al-Rahman Al-Bubshait
and department-head positions would be held by Saudis by 1990. and ‘Abd Al-‘Aziz D. Al-Falih.
The study also predicted that unless something changed, Saudis, who held a mere 12 percent
of management jobs in 1972, would hold only 54 percent of the managerial and professional jobs
at Aramco by 1990. As of 1972, only four of the company’s 44 departments were led by Saudis:
Mustafa Abuahmad, director of Employee Relations; Faysal M. Al-Bassam, manager of Public
Relations; Ali Al-Naimi, manager of Southern Area Producing; and Sa‘id M. Tahir, manager of Local
Industrial Development.
This rate of advancement was unacceptable, Jungers reasoned, especially in light of the participation
agreement giving the Saudi government a direct ownership stake in Aramco: “This was not so much
In 1974, Faysal M. Al-Bassam because percentage increases in Saudi government ownership demanded automatic corresponding
became the first Saudi to be named
increases in Saudi management. … We wanted to be sure that Saudis would be ready to move up.
a vice president of Aramco.
Realistically, we had to expect that participation could accelerate demands for Saudi management.”
One of the biggest bottlenecks preventing Saudis from advancing to senior positions was the
Saudi Development Committee, which as of 1973 seemed to be a contradiction in terms. Saudis
attending colleges or universities were divided into two groups. The A-group members were in
their junior or senior year and working toward a four-year degree. The B-group students were in
their first two years of studies and came up for review after their second year. Whether they would
be allowed to continue with their college educations at the company’s expense was usually left up
to the managers who had sponsored them. Today, Khalid Ali Alturki is one of the most successful businessmen in Saudi Arabia, but when
In the early 1970s, the unsettling fact was that these managers denied permission to as he grew up in al-Khobar it was in a family of only modest means. He joined Aramco as an office
many as 60 to 70 percent of the B-group students to continue their schooling and earn a degree. It boy in 1948 because it was, he explained, “the only place in Dhahran to get any schooling. …
was a simple but shortsighted decision: The managers benefited most by getting their employees But you had to be an Aramco employee.” When he showed promise in his part-time classes,
back on the job. Dialdin, the general manager of Training and Career Development, termed the Aramco sent him to the International College in Beirut. From there, he went to the United
B-group students “victims, because without a four-year degree they had no hope of advancing States, where in 1965 he earned undergraduate and graduate degrees in international
into management positions.” relations from American University in Washington, D.C. In 1968, he returned to the United
Jungers demanded that the committee act in the company’s best interest and support the States and received an MBA from Stanford University.
deserving B-group students. As a first step, the Saudi Development Committee set about finding After three more years at Aramco, Alturki left the company and went into business for
sponsors from its major departments who understood the long-term objectives of the program: himself. In 1973, this was an unusual choice. As he recalled, “I think I was the first and only
to build the next generation of Aramco leaders. As a result, word quickly spread throughout the one in my generation, with my education at Aramco, that left … just at the time when all
company that Jungers was serious about promoting capable Saudis to management positions. the Saudis were starting to take big positions in executive management.”
By the end of Jungers’s first full year at the Aramco helm, the number of Saudis holding Although he did not rise through Aramco’s ranks with his former Saudi colleagues,
supervisor positions—the starting rung on the management ladder—had jumped by 23 percent Alturki shared in their success. His first business was an electrical contracting company,
to 366 out of 820 positions. In August 1974, Faysal Al-Bassam was named vice president of Public but he expanded into the construction, construction materials and oil and gas sectors
Affairs, the first Saudi to be appointed vice president. “The foresight was not there until Jungers during the 1970s and early 1980s in time to benefit from the oil boom. Alturki, and many
became chairman,” said Dialdin. “True Saudization began to take place after that.” Saudis like him, were beneficiaries of Aramco’s training and support.
Pressure for change came from the Saudi workforce too. Ali Al-Baluchi, who had been a
B-group student and had fought successfully to continue his education, recalled: “In the mid-
1970s, a group of senior Saudis met with Shaikh Ahmed Zaki Yamani in House 17 in Dhahran
and discussed with him the unjustified slowness in promoting Saudis to higher positions. Soon
after that, more actions began taking place.”
Ambitious Saudis found that by the mid-1970s new career opportunities were open to
them, and that more and more expatriates were willing to act as mentors. While still a student
at the College of Petroleum and Minerals in Dhahran in the early 1970s, Hamed T. Al-Saadoun
worked for nine months in the Inspection Division at Ras Tanura Refinery. His supervisor, Ralph
Echezuria, who was fluent in Arabic, took the young Saudi in tow and gave him a solid grounding
in the business.
He invited Al-Saadoun to his home after hours. “He was like a father figure to me,” said
Al-Saadoun. After graduation, Al-Saadoun joined Aramco and progressed quickly through the
management ranks at the refinery. “All you needed to be was a Saudi with a college degree and
a love to work and take charge of things,” said Al-Saadoun, who served as vice president for four
company organizations before retiring in 2009.
As Saudis rose through the ranks, they also felt the responsibility to help promote other
qualified Saudis to follow in their footsteps. Sa‘ud Abdulrahman Al-Ashgar, who retired as senior
vice president of International Operations in 1997, was a plant superintendent in Ras Tanura in
the early 1970s. “I saw part of my role was to look at potential shift coordinators and potential
replacements for myself. Because we had three additional LPG [liquefied petroleum gas] plants and
a new reformer, and each one needed a foreman … I would plan ahead and say, ‘OK, we’ll take
shift coordinators and make them foremen and then develop some supervising operators to be
shift coordinators.” One of the early Saudis he helped promote to management roles was Ibrahim
M. Al-Rebdi, who became the superintendent of a newly created Refinery NGL (natural gas liquids)
Division in 1977 and then left the company to start his own business in the Eastern Province.
The “Greening of Aramco” Over the years Aramco developed a succession planning system for
Saudi and expatriate employees. Every management job—supervisor through senior vice president—
had to have three candidates listed as having the potential to fill the job. The charts specified the
training or experience each candidate needed, and how much time that would require.
The government generally avoided interfering in company personnel matters. Minister
Yamani, however, as the person with responsibility for overseeing the development of the Saudi ”Most Ambitious Energy Project in History” A few years before the 1973–74 oil price rise Ali Al-Naimi, right, vice president
of Producing and Water Injection,
petroleum industry, monitored the trend of senior Saudis progressing through the management brought unprecedented wealth to Saudi Arabia, King Faysal had implemented a program to
chats with Manager of Public Relations
ranks. As Baldo Marinovic, appointed head of the Management Development Department in achieve the Kingdom’s First Five-Year Development Plan in 1970. It was created when annual Abdallah S. Jum‘ah, center, and
filmmaker and photographer John
1978, recalled, Yamani requested that the department develop a highly confidential chart for oil-related revenue topped $1 billion for the first time. The plan predicted a modest 9.5 percent
Feeney, left, in Dhahran in 1976. As the
tracking Saudi candidates at the general manager level and above. On what came to be known annual increase in oil revenue. Drawn up with the help of the Stanford Research Institute, the company workforce expanded, greater
as the “greening of Aramco” chart, a box representing an executive position held by a Saudi plan amounted to a somewhat cautious listing of projects, reflecting the relatively slack oil market numbers of Saudis rose higher in the
ranks. By 1976, Saudis held 46 percent
was colored green; a box where a Saudi candidate was considered ready to assume the position conditions in 1968 and 1969 when the plan was formulated. In two years, surging oil revenue, of Aramco’s supervisory positions.
within two years was striped green; and boxes representing the positions for which there were which hit $2.7 billion in 1972, poured into government accounts, even before the spike in oil
potential Saudi candidates but no specific time frame for their promotions were outlined in green. prices triggered by the 1973–74 embargo.
Only a handful of department executives ever saw the chart, which was carried by hand Aramco and its oil-processing facilities provided roughly 90 percent of Saudi Arabia’s revenue
to and from meetings in Riyadh and otherwise kept locked in an Aramco safe. Given the high as the 1970s began. Government experts and outside advisers had been debating for years the
visibility and prestige attached to Saudis who reached senior positions in the company, the chart best way to spur further industrialization in the country. Their goal was to diversify the economy
“was dynamite,” said Marinovic. and provide employment opportunities for Saudis coming of age, including the increasing number
One of the most closely tracked candidates was Al-Naimi. When Jungers asked him to go of college graduates. An obvious solution was to tap the huge amount of natural gas, produced
for a ride around Dhahran on May 1, 1975, Al-Naimi did not think anything special was in store. along with crude oil, and use it as a low-cost fuel for industrialization. With the oil boom well under
Jungers often sought Al-Naimi’s opinion on a variety of topics. The 40-year-old Saudi had been way, the country could afford such a massive undertaking.
promoted just the previous fall to manager of Northern Area Producing, which gave him oversight At the time, most but not all natural gas was flared. Since 1955, Aramco had been reinjecting
responsibility for 11 of the company’s 15 producing oil fields. He would not be in line for another gas separated from crude oil back into oil fields to maintain reservoir pressure, starting with
promotion for years. Or so he thought. a plant in Abqaiq. Al-Naimi, who had been named a superintendent of operations in 1969,
Jungers pulled to a stop in front of the Administration Building and turned toward Al-Naimi. recalled that this plant was used to inject about 200 million standard cubic feet per day (scfd)
“Ali, I want to congratulate you. The board just elected you a vice president of the corporation.” of gas “to maintain the reservoir pressure at Abqaiq field. In [the] late fifties and early sixties,
Al-Naimi had high hopes for his career, but he was completely taken by surprise when he was another plant was constructed at ‘Ain Dar for similar purposes, the injection of 200 million
named to the new post of vice president of Producing and Water Injection, making him just the cubic feet approximately of associated gas to maintain the pressure at ‘Ain Dar and Shedgum
second Saudi vice president. [in the Ghawar field].”
“Bulldozers Were Going Twenty-Four Hours a Day”
Before the 1930s, Saudi Arabia was virtually unknown in non-Muslim countries. The discovery
of oil both brought the country greater international attention and increased the pace of
modernization. At the time of discovery, most of the population resided along the coasts or
in oases in villages of mud-brick huts. Riyadh had only 30,000 residents. Today, as oil
wealth continues to drive growth, more than 88 percent of the population lives in cities,
and Riyadh has blossomed into a metropolis of more than 4 million. Hospitals, universities,
paved roads and suburban communities, developed by a combination of Saudi and foreign
labor, now stand in what once was empty desert.
Baldo Marinovic, former assistant to the chairman of the board, recalled the rapid
growth of the 1970s: “That boom was something incredible. Roads were being built, bridges,
ports, hospitals, oil facilities, gas facilities—I mean, bulldozers were going twenty-four hours
a day, cement mixers. Every big construction company in the world was there. ... And they
all had to work with local partners, of course, which made the local partners very rich.”
Aramco played a key role in this surge of development, providing technical and The Aluminum Products Company,
or ALUPCO, began operations in
financial assistance to a host of services and industries, from health and dental care to a
Dammam in 1975. As the Saudi econ-
soft-drink bottle factory. In al-Khobar, Aramco paved streets and constructed curbs and omy expanded in the 1970s, Aramco
increasingly turned to domestic
sidewalks, while in neighborhoods where Saudi employees built homes under the company’s
enterprises for goods and services.
Home Ownership Program, Aramco did site preparation; paved streets; and built curbs, side- In 1975, Aramco awarded some 400
walks and playgrounds. The company’s local Industrial Development organization supported a major contracts, worth roughly
$250 million, to Saudi businesses for
variety of businesses, including paper, plastics and paint manufacturing; cold storage construction and other services, and
and meat processing; a hollow-glass factory; and service shops for valve repair, electronic purchased more than $700 million
worth of goods from local suppliers.
maintenance, air conditioning, water well drilling, heavy equipment overhaul and others.
On an experimental farm in al-Hasa and at other venues, company agricultural experts
transferred knowledge and technology to Saudi farmers and agricultural technicians about
the dairy and poultry industries, vegetable and fruit production, weed control, mechanization,
modern packing and beekeeping. One of Aramco’s most significant contributions was its
support behind the creation of the Kingdom’s industrial standards for safety, the environment,
materials, design and construction.
The company’s scholarship and training programs supplemented government efforts
to provide every interested citizen with a free education through a constantly expanding
school system. Today, 85 percent of Saudi children complete their primary education
in government schools, and 28 percent go on to college. Many of these students will
Aramco’s technical assistance to eventually apply their skills at Saudi Aramco, the largest employer in the Kingdom today
Saudi farmers helped 25 farms
behind the government.
produce more than 18 million
eggs in 1966. Saudi farmers in turn
helped Aramco, supplying veg-
etables and other vital foodstuffs
to its dining halls and commissaries
that the company would other-
wise have needed to import
from abroad.
“Lest We Forget” build sites fast enough on land, the company towed in five-story accommodation barges from
Singapore and Japan, each with its own generators, desalination facilities, air conditioning, dining
A lot of new employees among the expatriates in the 1970s did not work directly in the oil halls and recreation areas. These “floating hotels,” as the company called them, were anchored
fields or in the processing plants, which were more than 90 percent Saudi-operated by that offshore at Ju‘aymah and near Dhahran and housed another 4,500 workers.
point. Thorn Snyder, Aramco’s chief economist for many years, was known for an orientation The MGS had a dramatic impact on Saudi contractors as well as on industries and businesses In 1980, five years after the govern-
talk he gave to new expatriate hires. William Laney Littlejohn, who joined the company as ranging from earth moving to construction, steel, cement and welding. In 1975, Aramco awarded ment requested Aramco to design,
build and operate the Master Gas
an economist in 1972, recalled: roughly 400 contracts for MGS work valued at $250 million to Saudi firms. The following year, System (MGS), the massive project
Thorn … explained to the new employees what the world energy market the amount of gas-related construction business directed toward Saudi firms jumped to 620 was 75 percent complete. Key compo-
nents of the MGS began operations or
looked like, what the oil market looked like, what Saudi Arabia’s role was major contracts valued at $1.7 billion, and in 1977, the value of 730 gas-system contracts for were completed that year, including
and what Aramco’s role was in the international oil markets. He recognized Saudi firms reached nearly $2 billion. the Shedgum Gas Plant, shown here.
that after a little while, wherever you worked in Aramco you could forget
Many of the thousands of what it was you were really over there doing—say if you worked in data
expatriate professionals who processing, or accounting, or in the hospital. Thorn would wind up this
joined Aramco in the 1970s found
themselves living in somewhat talk holding a lab jar of Arabian Light crude oil and say, ‘Lest we forget.’
less than ideal conditions, such as
these trailers in Dhahran in 1976,
as the company expanded its
ranks of employees faster than it
could build permanent housing.
Since the early 1960s, Aramco had also been capturing a modest amount of heavier natural
gas liquids, or NGL—propane and butane—while processing oil at Abqaiq. This by-product was
shipped by pipeline to Ras Tanura. There, the NGL was processed and stored in refrigerated tanks.
Some NGL was sold locally, and some was shipped to overseas buyers, mostly in Japan. That left
the lighter natural gas, methane, to power the industrialization of the country.
In 1962, the government created the General Petroleum and Minerals Organization, better
known as Petromin, which between 1964 and 1968 purchased all of Aramco’s product distribution
facilities in the Kingdom. Petromin had been studying industrial applications for the country’s natural
gas even before the government acquired a 60 percent stake in Aramco in 1974. Petromin hired Texas
Eastern Engineering Ltd. to do a feasibility study. As Aramco economist William Laney Littlejohn
recalled, Petromin delivered the multivolume study to Aramco in 1975 and said, “Build it.”
The Master Gas plan was one of the cornerstones of the Kingdom’s Second Five-Year
Development Plan, which was unveiled in February 1975. Its release marked one of the last official
acts of King Faysal, who was tragically assassinated a few months later. He was succeeded by
Crown Prince Khalid.
The Master Gas plan was unprecedented in scope, as well as cost. The government
asked Aramco to design, develop and operate a gas-gathering and -processing system to
fuel the industrial network that was being developed on a parallel track. In June 1976, after
conducting its own feasibility studies, Aramco estimated the Master Gas System (MGS) would
cost between $12 billion and $14 billion. The company described it as “the most ambitious
energy project in history.”
By 1975, even before the hiring tied to the MGS project started, the Aramco workforce
had nearly doubled in five years to 19,500 workers. That demand for workers was driven by
two Aramco projects that in and of themselves were the largest of their kind in the world: the
offshore Zuluf GOSP-2 and the Qurayyah Seawater Treatment Plant.
Aramco scrambled to build and operate construction-worker camps at eight sites in the
Eastern Province to support the crude oil expansion projects as well as the MGS. By 1977, the
camps had the capacity to house 37,900 bachelors and 875 families. When it could not find or
Aramco’s American shareholders were ambivalent at best about the gas program. From
their perspective, there was little profit in selling Saudi gas. Committing Aramco to the MGS was
a distraction, even if it did not directly divert Aramco resources from the oil business.
Jungers seized on the gas initiative as a new vehicle for making Aramco, and its American
shareholders and management, increasingly important to the Kingdom’s development. Other Aramco
employees concluded that Jungers was not about to let any other company elbow its way into the
Kingdom and run the gas program if he could avoid it. The shareholders acquiesced, especially
since the Saudi government was paying the bills out of its oil revenues, not Aramco profits.
A residential barge was moored The MGS was designed to provide fuel or feedstock for domestic electrical power, cement,
near Half Moon Bay, down the
and desalination plants and for petrochemical, fertilizer and steel-making facilities. Two of the
coast from Dhahran, evidence of
the housing crunch Aramco faced largest proposed users for the gas were the sprawling industrial cities being constructed at
in the mid- and late 1970s. By 1978,
Yanbu‘ on the Red Sea and Jubail on the Gulf. Aramco also used the gas to power many of its
the year after this photo was taken,
Aramco was using six such vessels own facilities.
to house contractor employees. At the heart of the system were gas-gathering facilities in four oil fields in the Eastern
Province, gas-processing plants in the Eastern Province and on the Red Sea coast, and export
terminals at Ras Tanura, Ju‘aymah and Yanbu‘. By the time the initial system was completed in
1982, it could process about 3.5 billion scfd of gas—the energy equivalent of 750,000 barrels of
crude oil.
Aramco had used associated gas to maintain pressure in oil reservoirs, but that gas was
now slated for industrial use. The company turned to a more efficient alternative for maintaining
reservoir pressure: injecting treated seawater. In 1978, the Qurayyah Seawater Treatment Plant
began pumping 3.7 million bpd of seawater from the Gulf. The plant removed impurities (but not
The Port of Jubail, shown here in salt) and huge pipelines carried the water to injection facilities in the Ghawar field. It was a massive
1978, grew rapidly following a 1975
Royal Decree to create two industrial
undertaking and involved several technical hurdles, including engineering the metallurgy of the
cities, Jubail and Yanbu‘, linked by pipes to withstand the corrosive effect of the extremely salty water from the Gulf. The seawater
pipeline to Aramco’s Master Gas
System for a ready and low-cost
injection system also replaced the use of water drawn from onshore saline aquifers for reservoir
supply of fuel and feedstock. pressure maintenance.
Operators in the control room of

the Qurayyah Seawater Treatment
Plant in 1979 monitor the processing
and delivery of 4.2 million bpd of
seawater for injection into oil fields
to maintain reservoir pressure.
Construction of the East-West NGL

Pipeline reached Banban, a small
town near Riyadh, in September
1979. The pipeline linked Aramco’s
Shedgum Gas Plant to the indus-
trial city of Yanbu‘, 1,170 kilometers
across the Arabian Peninsula on
the Red Sea coast. Aramco also
built an NGL fractionation plant
and a marine terminal at Yanbu‘.
As work on Qurayyah was wrapping up in 1978, Aramco embarked on another major aspect of Modest Beginnings
the MGS: building an NGL pipeline across the country from the Shedgum Gas Plant in the Eastern
Province to Yanbu‘ on the Red Sea. It ran parallel to Petroline, a crude oil pipeline Petromin was Although it was not the first time Aramco had hired Saudi women, the worsening personnel
building, and went into service in July 1981. shortage at Aramco by the mid-1970s prompted the company to seek government
The 1,170-kilometer pipeline crossed some of the roughest terrain on the Arabian Peninsula, approval to train Saudi women for office and clerical jobs that until then had been filled
from sand dunes to lava fields and mountains. As Saleh Al-Redaini, the senior engineer on the project, by men. After five years of on-again, off-again planning and negotiations, Aramco
recalled, “Going across Saudi Arabia we had to drill our own wells for water supplies and build our opened the Special Clerical Training Center, its first training facility for Saudi women, on
own roads for transportation, especially in the west.” The NGL pipeline represented state-of-the-art January 24, 1976. The center was located in a one-story building across the street from
technology unimaginable a generation earlier. “The electronic survey work was unique and the the Administration Building in Dhahran. It opened with 10 young women as students.
pipeline design too had many unique features, such as electronic welding,” said Al-Redaini.
Electronic welding involved suspending two 12-meter lengths of pipe over the pipeline trench
by side loaders, where they were joined by automatic welders: one moving through the pipes and
the other along the outside. In the course of the project, these remarkable machines made 45,000
welds. On July 28, 1980, the final section was lowered into a shallow trench 1,082 meters high in the
Hijaz Mountains.
Power Play Despite the country’s increasing public and private wealth, the electrical power
grid in the Eastern Province, and the power systems covering most of Saudi Arabia, remained
inadequate, restricting business development and limiting the opportunities for average Saudis
to improve their quality of life.
The Zuluf gas-oil separation plant

(GOSP) 2 came on-stream in July 1977
with a design capacity of 540,000 bpd,
making it Aramco’s largest offshore
GOSP to date and one of the largest
in the world. The main platform was
connected by a 46-meter bridge to the
auxiliary platform with living quarters
for 80 men topped by a helipad.
The staff, comprising Arab and American women, included three instructors and a Samia Al-Edrisi, front row, third from
left and in the center of the group,
supervisor, who also was a part-time instructor. The only Saudi on the original teaching staff
was the first Saudi director of the
was Khalidah Al-Khayyal, the daughter of a Saudi diplomat who had a college degree in Special Clerical Training Center. Shown
here with the center’s teachers and
psychology. In 1977, another Saudi woman, Samia Al-Edrisi, was named to run the center.
staff, including Masha‘el Mo‘ammar,
She had been a translation specialist in Government Affairs, and had graduated from the back row, far left, a Saudi instructor
American University in Cairo with a major in political science and economics. of English, Al-Edrisi oversaw the
growth of the center from 40
The center trained Saudi women to take over jobs from a list of 231 clerical positions, students in 1977 to 150 in 1981.
such as correspondence classifier, typist, receptionist, medical clerk and library assistant.
Within a few years, the program expanded to include chemistry and science courses. Additional
subjects were added later. In 1980, the company provided scholarships to attend colleges in
the United States to three of the program’s highest achievers: Nadia Al-Shihabi, Badria Al-
Sindi and Haifa Al-Taifi. By the early 1980s, the women’s program had outgrown its original
location and a new two-story women’s training center was completed in May 1982.
Since that time, women have gradually assumed increasingly complex and sophisticated
responsibilities at Saudi Aramco, including positions in petroleum engineering, reservoir
management, information technology and human resources administration.
One of Aramco’s most challenging

projects in the 1970s was unrelated to
oil: the creation of a unified electrical
power grid in the Eastern Province.
The facility in this 1979 photo, one
of a pair located near Ju‘aymah,
began operations that year, increas-
ing the total capacity of the Saudi
Consolidated Electrical Company
(SCECO) to almost 1,900 megawatts.
By the mid-1970s, the situation had improved somewhat, but the insufficient infra- While solving a serious problem for the government, however, Jungers may have further
structure Jungers had observed was stretched to the breaking point: “The power that the eroded his support among the American shareholders by championing yet another major project
local power companies had was outdated, old diesel generator sets that they tried to hook that was only tangentially related to the oil business. As Powers, who served as president under
together. They weren’t integrated, all localized power, and it was going off all the time, and Jungers, recalled, “The owner companies were dead set against it. … They saw it would diffuse
the transmission facilities were terrible. So we thought of the idea of forming a consolidated our efforts from the oil and gas business, because here we were building power lines, whole
power system.” substations, whole power plants, everything.”
If embracing the gas project was a reactive move on the part of Aramco and Jungers, Years later, Jungers described the events that led up to the creation of SCECO:
the other major project that Aramco took on in the mid-1970s—creating a unified electrical It again was in that period when we were moving ahead with the gas program
power grid in the Eastern Province—demonstrated that Aramco’s characteristic determina- that it occurred to me primarily that we had to do something with our power system.
tion could solve some of the toughest problems in the Kingdom. The Saudi Consolidated Aramco had its own power company, its own power. All of our communities were run
Electrical Company (SCECO) became a key part of Aramco’s and Jungers’s legacy. by our own power plants, and they were as reliable as any power plants are anywhere.
Sometimes we went to the local towns at night for dinner with our Saudi friends, and Larry Tanner, vice president of Plants and Pipeline, was flying with a group of reporters
all of a sudden the power would go off, and it would be hot because the AC would to different Aramco sites in early May 1977 when he spotted a pillar of smoke rising from the
be off. And still Aramco’s community nearby was lit up and functioning. These people direction of Abqaiq. His worst fears were confirmed minutes later when he received a call on the
are there damning their own power system, which was only going to end up with plane radio requesting him to return to Abqaiq as quickly as possible. A buried crude oil pipeline
discontent and wondering why only the “Aramco foreigners” had power. had ruptured and flames were engulfing entire sections of the world’s largest oil processing plant,
as he later described: “The fire had burned up most of the [gas-oil separation] spheroid area.
Over the course of several months, a group of Aramco officials worked out the details of how Shedgum [oil field] was [at an elevation] 600 feet above Abqaiq with 100,000 barrels of oil in
the 26 local power companies would be combined with Aramco’s power plants. In August 1976, the pipeline. We could not close the valves to keep the additional oil from feeding the fire. They
King Khalid issued a Royal Decree creating SCECO. Aramco built, operated and managed the utility were starting to close one valve and it took hours. … We had basically [to] shut Abqaiq down.”
during its first five years of operation, “seconding,” or lending, employees to run the utility and train At that time, 10 million bpd of oil were being processed at Abqaiq.
Saudis in the industry. This mandate was later extended to 1983, when the management agreement
was replaced with an agreement for loaned employees and services to be provided by Aramco. Despite the tremendous demand
for personnel during the mid-1970s
SCECO’s original service area included approximately 90,000 people in about 200 communities expansion, Aramco continued to
and covered an area roughly the size of New Zealand, as well as the industrial city under development sponsor out-of-Kingdom education
for Saudi employees. In 1976, a
at Jubail. Within five years, the utility’s customer base more than doubled to 195,000, many of whom total of 54 personnel were sent
lived in remote villages that previously lacked electricity. The SCECO experience was later copied in to high schools and universities in
the United States. This group of
other regions of the Kingdom, and eventually all of the regional power companies merged into a
young men composed the second
single Saudi Electricity Company power grid. batch to be sent that year.
Being assigned to a power company that Aramco was going to operate on behalf of the government
may have sounded like a questionable career move, but several future senior Aramco executives made
their mark at SCECO. John Kelberer, who had worked on Tapline issues in New York in the mid-1970s
and earlier had worked as an engineer on Tapline in Beirut and in Saudi Arabia, came to Dhahran and
succeeded Jungers to become the last American chairman of the board and CEO of Aramco. Initially
for a short period, though, Kelberer was a member of the board of SCECO and its managing director.
One of the first staffers assigned to SCECO was a Saudi from Aramco’s Public Relations Department
who had recently returned from a management training course at Harvard. His name was Abdallah
Jum‘ah, manager of Power Systems Public and Customer Affairs from 1977 to 1979.
Aramco insiders universally credit Jum‘ah with outstanding people skills and cite this ability
as among the most important factors in his eventual rise to the positions of president and CEO.
Jum‘ah himself credits his time spent in the field with SCECO in the late 1970s as one of the most
influential assignments in his career. One of his responsibilities was to act as the liaison with the 26
power companies and with the remote villages around the province that were to be included in the As they stood amid the smoking ruins of the plant on the afternoon of the fire, Jungers
SCECO grid. He listened to the villagers’ concerns and convinced them that connectivity to the grid and Yamani bombarded Tanner with questions. The fire had killed a Saudi foreman, Muhammad
could not happen instantly. One story Jum‘ah told illustrated the knowledge and cultural gaps he Al-Sunayyin, injured 13 workers and caused $100 million in damage. Tanner and Jungers estimated
had to close as part of his assignment: they could get the plant back to full capacity in one month. Lying awake that night, Tanner blamed
We had a line of 10 villages, and we ran the 115 kv [kilovolt] line to the himself for making such an aggressive estimate, but Aramco rose to the occasion. Working under
end where we put a big substation to drop the voltage to the usage voltage. Then, tremendous pressure, repair crews had the facility producing at more than 50 percent of capacity
as part of our value engineering, we said, ‘… Why don’t we put the substation in in less than a week. Thirty-four days after the fire, Abqaiq was operating at full capacity, though
the village before last, and run a cheaper line to the other village.’ I had a delegation with a temporarily diminished gas separation process.
coming from the last Bedouin village saying, ‘We don’t want the leftovers,’ because A lengthy safety review led to company-wide changes in the treating of buried pipelines,
they felt that electricity coming in on a smaller line was leftovers. including gas pipelines, following another fire caused by a ruptured gas pipeline in 1978 in the
I’ve seen hundreds of people in my office, from all walks of life; someone Abqaiq oil field. Substantially more fire-fighting equipment and concrete dikes and trenches between
concerned about a problem, a representative from a village asking about progress on processing plants were also installed throughout the company. Dhaifallah A. F. Al-Utaibi, who
the distribution network. I love dealing with people and it’s been the most rewarding retired as senior vice president of Gas Operations in 2004, was head of maintenance in Abqaiq
experience of my career so far. at the time of the fire. He recalled that “it took time and money [but] the outcome transformed
the facilities from where they were to first-class facilities, and kept them that way.”
Pl ant Safet y The huge increase in the amount of oil being processed by the mid-1970s
made the potential for loss of production, and loss of life, all the more significant. A handful of Refocus on Saudization With the massive buildup of projects and personnel during the mid-
accidents at Abqaiq during the 1970s, beginning with an August 1972 fire that led to the deaths 1970s, Saudization—the term used to describe the development of Saudis to assume company
of 13 workers and injured 13 others, prompted the company to overhaul safety procedures. The positions—slowed down considerably. It was all the company could do to bring in bodies to
turning point came in 1977. fill positions; individual career development, with certain key exceptions, took a backseat. In
addition, by late 1977 it was widely rumored that Jungers was on his way out, and he left the Symbolic of the rapid growth
occurring in the major metropolitan
company in January 1978. (Powers, president under Jungers, was moved to the newly created areas in the Kingdom in the 1970s
position of vice chairman in 1978. He retired in March 1979. Replacing him as president in 1978 and 1980s, Jiddah, seen here in
1974, grew upward and outward.
was Hugh H. Goerner, a senior official from Exxon.) While the Saudization process had lost its
most high-profile champion in Jungers, this crucial initiative was taken over by a new advocate,
and this time he was himself a Saudi.
Al-Naimi had risen to the level of senior vice president of Oil Operations in 1978 and was
the highest-ranking Saudi in the company. When John Kelberer succeeded Jungers as chairman
and CEO of Aramco in 1978, he ordered a review of Saudization, which generated several recom-
mendations. A key to his plan was to form a Saudi Arab Manpower Committee (SAMCOM) and
make Al-Naimi its first chairman.
The committee’s goal, Al-Naimi later said, “was to seek, track and make sure that Saudi
manpower was developed at all levels … coming from high school or going to college [or] coming
back as a professional development [program] employee, and also seeing to it that after they
finish these so-called PDP programs, they are pursuing their career.” He noted that “Saudization
had been through many tracks … 1979 was really a formalization … we were able to track every
Saudi who exhibited potential for further development.”
Aramco CEO Frank Jungers, right,

hosts a press conference with
journalists from Saudi newspapers
to discuss the May 1977 Abqaiq fire,
which killed one worker and injured
13 others. Those present include
Hamid Mutawi’, ‘Abd Allah Manna’,
Muhammad Al-Jihian, Jihad Al-Khazin,
Khidr al-‘Ali, Muhammad Al-‘Atiq,
Fahd Al-Dossary, Bob Crew, Ahmad
Muhammad Mahmud and ‘Abd
Al-Majid Shubukshi.
Following months of negotiations, the government announced in February 1979 an

agreement to buy the remaining shares in Aramco and assume full ownership of the company.
This surprised no one. Aramco officials and the four American shareholding companies had for
some years assumed the inevitability of such a step. The agreement was signed in 1980 and on
a financial basis was retroactive to 1976.
Fully owned by the Saudi government and refocused on developing and promoting
qualified Saudis through the ranks, Aramco had helped engineer the smoothest and most
effective transition to national ownership the world had ever seen. Rather than acrimoniously
severing ties with the Western companies that had developed its oil industry—as had been the
case elsewhere—the now Saudi-owned Aramco maintained close commercial and technical
ties to its former American shareholders. Indeed, the government retained Aramco to manage
the company on its behalf for a number of years. King Khalid and Minister Yamani recognized
the need to maintain access to expatriate technical expertise as the government continued to
groom Saudis for more senior roles.
66 energy to the world : Volume two Transformation 67
chapter three
Transformation
The East-West Crude Oil Pipeline, 1985.

On May 16, 1983, Saudi royalty and dignitaries,

led by King Fahd, celebrated with company
officials and employees in the recently com-
pleted Exploration and Petroleum Engineering
Center—commonly known as EXPEC—at the
center of the Aramco office complex in Dhahran.
The event marked the 50TH anniversary of
the signing of the concession agreement by
which the Kingdom granted Socal the right
to explore for oil in eastern Saudi Arabia.
King Fahd, who had succeeded his brother King Khalid when he died in 1982, honored the
“Saudis and non-Saudis who have exerted themselves so greatly, and contributed to making
Aramco what it is today.”
Though the event rightly honored those who had transformed the Kingdom through
its oil industry, the speeches that day focused not just on an illustrious past but also on a
promising future. Minister Yamani told the crowd, “Aramco is now a Saudi Arabian institution
that ‘speaks our language.’” He added, “We hope that the sun of this year will not set until a
Saudi has become president of this company.” His prediction became reality that November
when the Aramco board of directors appointed Al-Naimi the company’s first Saudi president,
effective January 1984.
The 1980s were a crucial period in the transformation of Aramco, as the Saudi government
assumed full ownership of the company in the first year of the decade. The creation of EXPEC
A field geologist examines rock in reduced through a series of relin- reflected this major shift in that EXPEC enabled Aramco to consolidate all of its high-tech King Fahd, accompanied by
October 1989, part of an explora- quishments. In 1986, the government Crown Prince ‘Abd Allah, waves
exploration and petroleum engineering functions in Dhahran, work that had previously been
tion campaign that surveyed new requested that Aramco expand its to the crowd during Aramco’s 50TH
prospect areas. In the years follow- exploration activities to include areas performed in the United States or Europe by the four former owner companies. anniversary celebration in May
ing the original 1933 concession and it had previously relinquished. In 1988, 1983 after inaugurating Aramco’s
This transformation continued when Al-Naimi assumed his duties as president in 1984.
the supplemental 1939 concession, a Royal Decree approved company Exploration and Petroleum
Aramco’s exploration area had been exploration activities Kingdom-wide. Al-Naimi was a product of the company’s career development and Saudization programs and Engineering Center (EXPEC).
proof of their success. A Saudi national, he was elected because he was the most qualified due
to his extensive training and years of service with the company. Al-Naimi, said Yamani, was
not selected to be president “because he is Saudi to satisfy national sentiment, but because he
earned the office through sweat and hard work, and because he has built himself and helped
build others.”
The Fast Track Program During this period, Aramco significantly stepped up the hiring of
Saudi high school students in anticipation of sharply higher staffing needs. In the decade prior
to 1979, the company hired an annual average of only 90 high school graduates; that year the
number expanded enormously, to 796. In 1980, the figure jumped again, to 1,281.
The College Fast Track Program, instituted in 1979, attracted a great deal of interest among
Saudi high school students. High school graduates with a grade average of 85 (out of 100) or
better who agreed to join Aramco were sent to the United States for up to one year of intensive
training in English. Those who achieved a 500 or better (out of 677) on the Test of English as a
Foreign Language (TOEFL) proficiency exam qualified for an Aramco college scholarship. Even
though only 57 high school graduates, including 13 women, qualified in 1979, many high school
students joined Aramco after being initially attracted by the College Fast Track Program.
Aramco also intensified its pursuit of Saudi college graduates. In 1979, the company hired
124; in 1980, it hired 203. The two-year total exceeded the number of Saudi college graduates
hired by Aramco in the previous two decades. These robust numbers, however, hardly put a
dent in demand. Kelberer wrote to members of executive management on December 14, 1981,
demanding additional hiring. “Every Saudi college graduate should be hired and developed,” he
said, adding that the matter was “of utmost importance.”
The story of Al-Naimi’s rise from Bedouin shepherd boy to president and CEO of Aramco,
and later Minister of Petroleum and Mineral Resources, is perhaps the best-known example of
the company’s contribution to the extraordinary transformation of Saudi Arabia and its people,
but thousands of Saudis experienced similar journeys.
Aramco-sponsored students gather

on the campus of Arizona State
University in Tempe, Arizona, in 1982.
More than 1,200 Saudi employees
were enrolled in university-level
programs in Saudi Arabia and abroad
that year, emblematic of the company’s
increased effort to develop Saudis.
On November 8, 1983, the Aramco Planning for Prosperity Aramco had been caught short-staffed when the 1970s oil boom
board of directors selected Ali
began. Company planners were determined not to make that mistake again in the 1980s.
Al-Naimi, seated right, as the
company’s first Saudi president. Extrapolating from trends at the end of the previous decade indicating strong global demand
His appointment took effect
for oil, Aramco’s corporate planners predicted the company needed to hire 30,000 more
January 1, 1984.
Saudis by 1985, more than doubling its Saudi workforce, to reach an anticipated total payroll
of 75,000 employees.
To help train these new employees, the company approved a training budget of nearly
$300 million for 1980. New programs were introduced, training facilities built and staff added.
“Developing people is time consuming and expensive, but it pays off in the long run—both
from the individual’s and the country’s point of view,” noted Abdulaziz M. Al-Hokail, senior
vice president of Industrial Relations in the early 1980s, who retired in 2002 as executive vice
president of Manufacturing Operations.
Fortunately, Aramco could afford to foot the training bill. The company’s revenues
ballooned by 1980 to more than $84.5 billion. In the wake of the Iranian Revolution in the
late 1970s, global oil prices soared once again. Arabian Light crude oil climbed from $12.70 a
barrel in 1978 to $26 a barrel by January 1980. Aramco, making up for lost Iranian oil output,
produced a record 9.6 million bpd during 1980, an increase of 1.5 million bpd over 1978. Saudi
Arabia was now the world’s second-largest oil producer, after the Soviet Union’s 11.7 million
bpd. (The United States was third at 8.6 million bpd. No other country was close to the top
three. Iraq was fourth largest with 2.6 million bpd.)
The transformation of Saudi Arabia Professional Development Program

from desert kingdom to modern
nation was mirrored in the personal
journeys of thousands of Saudis who Aramco’s commitment to helping new college graduates integrate themselves into the
came of age in the 1950s and rose
to high positions in Aramco in the
professional world intensified in 1974, when it established its Associate Professional Program
1970s and 1980s. Some of these (APP). Initially, the program suffered from high attrition. When the late 1970s brought
accomplished men are shown in this
November 1988 photo, including, left
increased Saudization, Aramco executives reworked the program to hire as many new
to right, Ahmed S. Al-Humaid, vice Saudi college graduates as possible.
president of Government Affairs;
In 1980, APP was developed into the Professional Development Program (PDP). The
Douhan Al-Douhan, executive
director of Management Services; revised curriculum retained the three years of rotating job assignments that had characterized
Sa‘ud Al-Ashgar, vice president of
APP, but added written and oral English-language courses, a variety of basic training
Planning; Ismail I. Nawwab, general
manager of Public Affairs; and programs and a stronger individual counseling element. Those with weak English skills
Faysal M. Al-Bassam, vice president
spent an additional nine months in a language immersion program.
of Public Affairs. Standing behind
Al-Ashgar and Nawwab is John Duke
Anthony, president of the National
Council on U.S.-Arab Affairs.
Douhan Al-Douhan, for example, as a teenager in the 1950s made the three-day journey
across the roadless desert from Najran to Abqaiq in the back of a truck with more than 20 other
passengers. Al-Douhan was “looking for a future” with Aramco. “In the United States, people
said ‘Go west, young man, go west.’ Here, they said ‘Go east,’” to Aramco, Al-Douhan recalled.
He was not hired on his first application, but later, after working with a local contractor as a
welder’s helper, he was hired by Aramco and trained as an auto mechanic. In 1965, he was
part of a group sent to Temple University High School in Philadelphia to earn secondary-school
diplomas. Al-Douhan went on to earn a bachelor of science degree in engineering technology
from Memphis State University in Tennessee and after a series of assignments became executive
director of Management Services. He retired in 1995.
Many Saudis who were sent abroad for higher education compiled impressive records.
Jaber S. Jum‘ah, for instance, was awarded the International Students Award each of the four
years he attended Youngstown State University in Ohio. He ranked in the top 1 percent of his
class during all four years, was elected to the national Phi Kappa Phi honor society and graduated
summa cum laude in 1973 with a degree in business administration. He rose in the company to
manager level before retiring in 1992.
As coordinator of out-of-Kingdom training in the United States from the late 1950s through
1977, Bob Brautovich oversaw the development of many young Saudis. “I have the greatest respect
in the world for those Saudis who came to school here [in the United States]. I don’t think I could
go to Saudi Arabia and do what they did when they came here,” he said.
The Saudi college graduates who joined Aramco during this period as professionals were
proud that Aramco actively recruited them. At the same time, they faced resentment from some
Renamed King Fahd University of of their countrymen who had worked for Aramco for years but had not had the same educational
Petroleum and Minerals (KFUPM)
opportunities. Riyadh University graduate Khalid Nassir Al-Maghlouth joined Aramco in 1980, In its first year, PDP enrolled 400 employees, 203 of whom were newly graduated The work of a young enrollee in
in 1989 when this photo was taken,
the Professional Development
the institution celebrated in 1992 entering its Professional Development Program. He was sensitive to the fact that among the older Saudis. This total included new employees with fewer than three years of previous employ-
Program is checked by a senior
the 20TH anniversary of a coop-
generation “many of them had worked day and night for 20 to 25 years to reach grade code 10.” ment, although the program allowed them to follow a different course of study from the staffer in the program’s design
erative program in which students
room. Enrollment in the program
received college credit for work He and his fellow college graduates started their careers at grade code 11, the initial professional recent graduates. Senior Vice President of Finance Abdullatif A. Al-Othman, who entered PDP
fluctuated throughout the
assignments at Saudi Aramco. level. For every complaint, however, there were plenty of Saudi veterans who took pride in the in 1981 after working for two years outside the company, was relieved to find that the com- decade, peaking at 910 in 1987.
college graduates as representatives of a “bright, new generation” of Saudis, Al-Maghlouth said. pany was “actually very aware of the need for flexibility” for those with prior work experience.
By 1984, Aramco had 55,819 employees. The Saudi workforce totaled 34,226, of which The program initially enrolled some expatriates but soon shifted its focus to encompass
3,343 held supervisory positions—nearly 62 percent of the supervisory jobs available. Training only Saudis. By 2008, more than 11,000 employees had benefited from the program.
these recruits was a top priority for Aramco, which by then had assembled one of the largest
industrial training organizations in the world.
Transformation 75
Prosperity Well Ameera A. Al-Mustafa, left, a

senior geophysical consultant,
discusses reservoir diagrams with
Dammam Well No. 7, the original discovery well that set the stage for the modern era colleague Hashim Hussein. The
company’s efforts to sponsor the
in Saudi Arabia, was finally shut down in 1982 because of slack demand for oil, even though education and training of Saudi
it was still capable of turning out about 1,800 bpd under natural pressure. The well, also women began paying dividends
in the late 1980s as more women
known as “Lucky No. 7,” had produced nearly 32.5 million barrels of oil. In 1999, King ‘Abd joined the professional ranks of the
Allah, then Crown Prince, visited Well No. 7 during a tour of company facilities and gave company in fields such as petroleum
engineering and computer science.
it the name “Prosperity Well.”
Twenty-five years after the well was shut down, company geologists analyzed newly
acquired 3-D seismic readings of the Dammam Dome in anticipation of once again producing
oil from the structure, but not from Well No. 7. To avoid disrupting life in Dhahran, plans
were drawn up to use horizontal wells that, from a safe distance, could tap the estimated
1 billion barrels of crude remaining in the reservoir.
The second wellhead from

Dammam Well No. 7, which
controlled the well’s pressure
between 1952 and 1978, stands
just outside the Exploration and
Petroleum Engineering Center.
Nabilah M. Altunisi, shown here in

2009 in her office at Aramco Services
Company in Houston, Texas, was director
of engineering on a proposed integrated
refining and petrochemical project. She
”I See a Challenge” By the 1980s, young Saudis who had witnessed the phenomenal growth of got her start with Aramco in 1982 as a
the oil industry and the Kingdom during the 1970s were flocking to Aramco. They were not simply computer systems engineer.
looking for a paycheck or status; many wanted to make a difference in their country’s future, and
they wanted a challenge. As Haider Al-‘Awwami, production supervisor at Safaniya in the mid-1980s,
explained, “If it was money I wanted I would go and open a supermarket in al-Khobar. If I wanted
a name and prestige I would go into government. I see a challenge in what I am doing here.”
Many young professionals jumped at the opportunity to demonstrate that Saudis could run
their own oil company. Salim Abu Khamsin graduated from the College of Petroleum and Minerals
in 1973, and after a stint with another oil company and earning a master’s degree in petroleum
engineering, joined Aramco in 1978. By 1984, he was superintendent of Safaniya Offshore Producing.
He conceded that the isolation of offshore work was sometimes difficult, “but some Saudi has to
do the job; we don’t want to be spoon-fed by expatriates.”
Other Saudis realized that a job with Aramco gave them the opportunity to make an impact
on the company and in some cases the oil industry itself. One example was Hesham Al-Musaiid,
who joined Aramco after graduating with a degree in civil engineering from the University of
Petroleum and Minerals. After reviewing the American Petroleum Institute (API) standard for design Professional Women While the 1980s opened new career opportunities in information technol-
of storage tanks during the course of work on a project, he concluded that two of the assumptions ogy and other areas for women, as early as the 1960s and 1970s, a handful of professional women
on which the standard was based were incorrect. He recommended changes that would result in set precedents in other fields. They included Na‘ilah Mousli of Reservoir Engineering, Aramco’s
a more conservative and safer standard. The API Standards Committee accepted his proposal, and first female petroleum engineer and first female department manager. Another pioneer, Samia
the standard was revised accordingly in the late 1980s. Al-Edrisi, joined Translation in 1974 and retired in 1996 as a planning and programs analyst in
The consolidation of computer-intensive work at EXPEC in the early 1980s opened up a new Public Affairs. The early 1980s witnessed an exceptional influx of professional Saudi women at
field of endeavor for ambitious Saudis. Ibrahim S. Mishari joined the company in 1974 after earning Aramco. Many serve as role models for current women employees.
a doctorate in computer science from Leeds University in the United Kingdom, and became manager Few professional opportunities in the field or at production facilities were open to Saudi
of the Computing Technology Department in 1984. He was attracted to the oil industry by “the women in the early 1980s. The establishment of EXPEC and the expanding use of computers
scope of the work and the challenge,” he said. “I was becoming more aware of oil and its future in general, however, provided them with additional career opportunities. Nabilah Altunisi’s
importance.” He saw Aramco as representing the future of computer applications in the petroleum career benefited greatly from what EXPEC offered. She recalled: “They needed … people with
industry. Mishari advanced through the ranks, leading the company through successive waves of engineering backgrounds, computer backgrounds, all of these technical-types—petroleum
computer modernization and information technology advances. He retired as vice president of engineers and so forth. … And they made me an offer, and they told me about this computer
Marketing and Supply Planning in 2007. center and what they were planning to do. … ”
Petroleum Sleuths After earning a master’s degree in electrical engineering from Oregon State University,
Altunisi declined several job offers from companies in California’s Silicon Valley to return to
EXPEC brought together under one roof the equipment and expertise to enable Aramco Saudi Arabia in late 1982 and work in EXPEC. She immediately began writing petroleum
to move to the forefront of world-class technology in exploration, drilling and reservoir engineering computer applications on a state-of-the-art IBM mainframe. Within a few years,
engineering. Company personnel, rather than outside consultants, could now conduct Altunisi was working in project management, on assignment in Houston, Texas, overseeing
from company headquarters in Dhahran their search for hydrocarbons and the best means multimillion-dollar contracts. In 2005, she was promoted to manager of the Project Support
of producing them. and Controls Department, overseeing a staff of more than 380 employees. The following year,
Within the Exploration & Producing organization, a variety of geoscientists and she returned to the United States and earned an executive MBA from Stanford, and then was
petroleum engineers today consider a host of clues gathered from seismic surveys, core called on to serve as the company’s director of engineering on a proposed petrochemicals
samples, wire-line logs and other means, and employ tools ranging from satellite surveys project with Dow Chemical Co. In 2006, Altunisi was included on a list of 25 influential women
to scanning electron microscopes. The overall goal of all this data analysis, explained Dave from around the world in project management by PM Network magazine.
Cantrell, former chief geologist and current chief technologist in the EXPEC Advanced Thuraya Al-Arrayed, who joined Aramco in 1980, obtained her doctorate in educational
Research Center, is "to characterize the reservoir, its internal stratigraphy or architecture." planning and administration from the University of North Carolina in 1976. The company had Thuraya Al-Arrayed, a planning
adviser with Saudi Aramco at the
wanted her to start immediately in Corporate Planning, but she insisted that she preferred to get
time, was a featured speaker at
a good overview of the company’s range of activities first, and that Public Affairs was a better the Doha Debates in Qatar in 2009.
After earning her doctorate from
starting point. One of her first projects was to start a mobile library program as community
the University of North Carolina
outreach to local schools. She worked with a designer to retrofit two used vehicles as mobile in 1976, Al-Arrayed began her
career in Aramco Public Affairs.
libraries to carry books to schools across the Eastern Province.
In another project, Al-Arrayed wrote Public Affairs’ first guidebook for implementing the then
new Personal Development Program, which became the seed for the Professional Development
Program guidebook that today is used throughout the company. In 1981, she joined Corporate
Planning as its first permanent Saudi employee. Upon her request, one of her first assignments
was to assist in coordinating the company’s five-year planning process with that of the Kingdom’s
plans for the energy sector.
Huda M. Al-Ghoson received an undergraduate degree in English literature from Riyadh’s
King Sa‘ud University (then known as Riyadh University) before joining Aramco’s Medical
Services organization in April 1981 as a patient relations representative. A few years later, the
company granted her a leave of absence to complete her master’s degree in business adminis-
tration at American University in Washington, D.C. Shortly after receiving her master’s degree
in 1986, she transferred to Industrial Relations, where she completed various assignments of
progressive responsibility until becoming the first woman in a corporate adviser position. In
2007, Al-Ghoson was the first woman named to the board of directors of a company subsidiary
when she joined the board of Vela International Marine Limited. Two years later, Al-Ghoson
was appointed general manager of Training and Career Development.
Fatema H. Al-Awami was among the handful of Saudi women to receive college scholar- Fatema H. Al-Awami, a supervisor
in the Reservoir Description and
ships from the company in the early 1980s. She attended the University of Southern California
Simulation Department, earned
and graduated in 1984 with a degree in petroleum engineering. She put her skills to good use a degree in engineering in the
early 1980s from the University of
in reservoir simulation, contributing to work on the Safaniya, Shaybah and Manifa projects,
Southern California in Los Angeles.
among many others. Al-Awami was one of the developers of the Event Solution, an innovative
multidisciplinary approach to resolving reservoir management issues.
Aramco’s Exploration and Petrolem A hydrocarbon reservoir is more like a sponge soaked with oil and gas, rather than
Engineering Center (EXPEC), on The dramatic increase in hiring beginning in 1980 caught Aramco without
an underground lake, and two key factors in how productive a reservoir might be are how New Neighbors
the left, and the adjacent EXPEC
Computer Center and Engineering big the holes are in the sponge and how they connect, known as porosity and permeability. enough housing, reminding company veterans of similar situations during the 1950s. New
buildings bustle with activity in housing units were constructed as quickly as possible, but the company could not keep up
Some reservoirs might contain a lot of hydrocarbons in the pore spaces within the rocks,
December 1982, five months before
the official inauguration ceremony. but unless the rock is permeable, the hydrocarbons will likely remain trapped in the stone. with the stream of new recruits—expatriates as well as Saudis. New employees often found
EXPEC enabled Aramco to consoli- Porosity and permeability are therefore vitally important for petroleum engineers to know. themselves living in trailers or other temporary housing while permanent accommodations
date its exploration and petroleum
engineering activities in one center. Thus, in one sense, petroleum engineers in EXPEC see hydrocarbon reservoirs as a giant were built.
plumbing problem: What is the best way to drain the fluids from the reservoir? "With James R. Tracy, a member of the Tracy family mentioned earlier (p.15), lived in Ras Tanura
multilateral wells and horizontal drilling, understanding the inner structure is even more from age three until he went away to high school. He was recruited by Aramco in 1980 after
important," Cantrell noted. serving in the U.S. Army, earning a master’s degree in international management and working
in banking. He had fond memories of a spacious house and a grassy yard in Ras Tanura. But
Lean Times Saudi Arabia has often been one of the few voices of oil market stabilization at
OPEC. When revolution temporarily halted the flow of Iranian oil in the late 1970s, many OPEC
members raised prices in response to the shortage. Saudi Arabia stood by the official price,
however, and strove to persuade other OPEC members to choose stability over short-term profit.
However, the combination of reduced demand stemming from energy conservation measures
enacted in the West and Japan following the price hikes of the 1970s, the continuation of high
production levels by OPEC, and increased production from Alaska, the Gulf of Mexico and the
North Sea resulted in lower oil prices in the 1980s. Oil on the spot market peaked in 1981 at $42
a barrel. In October 1981, OPEC finally agreed to stabilize the price of oil at $34 a barrel if Saudi
Arabia would lower its output.
The compromise, however, came too late to prevent a crash. While Saudi Arabia again
struggled to maintain the official price, other OPEC countries dropped their prices to stay com-
petitive with oil from the North Sea and other new fields. When prices started declining,OPEC
Aramco’s hiring initiatives during

the 1980s targeted not only Saudis
but also expatriates. This 1981 ad
highlights the quality of life
available to expatriates and their
families in Saudi Arabia.
The rapid pace of construction is

evident in this 1980 photograph of
Dhahran. Aramco built 780 new family
residences in its four main company
communities and started building
1,200 new bachelor units and other
facilities, but temporary residential
camps still housed 11,000 company
bachelors and 700 families.
when he returned to Saudi Arabia to assume the first of several financial positions with the
company, he and his wife, Claudia, were greeted by a slightly different prospect: “It was boom
times. We lived in a place called North Camp, which was basically a big trailer park out in the
desert. … It was just awful.” Despite the harsh conditions, the couple persevered and soon
moved into a comfortable home in Dhahran. He retired in 2003, ending his family’s 58-year
work history with Aramco, a service record not uncommon in a company with many third- and
fourth-generation employees, expatriate and Saudi alike.
As more Saudis achieved professional status in the late 1970s and early 1980s, the number
of Saudi families moving into Aramco communities increased. It was not unusual for a young
Saudi couple to move in next door to an American or other expatriate family who might have
been living there for 10 or 20 years. Many close relationships developed among new neighbors.
Vice President of Corporate Planning Ali A. Al-Muhareb and his wife moved into the Ras
Tanura community in the late 1970s when he was a young engineer. Their next-door neighbors
were an older, childless American couple who treated the Al-Muharebs’ first child as if he were
their own grandson. The American woman presented the Saudi mother with needlepoint gar-
ments and a baby blanket, among other gifts. After the couple retired and moved back to the
United States, the Al-Muharebs visited them during vacations and exchanged presents with
them for years. As the expatriate population of what is now Saudi Aramco has grown more
internationally diverse in recent years, such cross-cultural encounters regularly include South
Africans, Colombians, Venezuelans, Chinese, Britons and Filipinos, among many others.
countries agreed to production cutbacks to stabilize the market. Despite the reductions, prices In Saudi Arabia, expatriate ranks were thinned significantly by the time the payroll hit its
continued to fall through 1982, shaving approximately $39 billion off Saudi Arabia’s 1982 income low point of about 43,500 employees in 1987. More than 14,000 of the 17,000 positions elimi-
from oil revenues compared with the previous year. nated since 1982 had been held by expatriates. Among Saudis, many longtime employees were
In 1983, OPEC attempted another unified response. In addition to tightening the quotas encouraged to take early retirement. With so many expatriates leaving or taking early retirement,
and dropping the official price to $29 a barrel, it explicitly assigned Saudi Arabia the role of swing by 1985 the Saudi component of the workforce had increased to 65 percent.
producer. By having one country vary its production with world demand, OPEC hoped to keep The impact of the downturn on the smaller Aramco housing compounds was especially
the price of oil stable. Saudi Arabia soon found its new role difficult, however, as some OPEC striking. Aramco began a phased withdrawal of families from ‘Udhailiyah in 1985 in anticipation
countries still did not abide by the agreement. of shuttering the entire community. The size of employee populations at Tanajib, Khurais, Abu
‘Ali, Shedgum and Berri was slashed by 60 percent. In addition, from the end of 1984 through
the end of 1985, the number of contractors with living quarters assigned by Aramco plunged
from 6,400 to 1,600.
It was a tough period for those who remained at the company as well as those who were let
The Ripple Effect
go or took early retirement. For many who had joined during the booming 1970s, it was their first
lesson in coping with lean times. Khalid Al-Falih worked as a project engineer during the early to
The drop-off in demand for crude oil in the early 1980s was not just the result of a recession
mid-1980s: “The company went through a painful period. There were layoffs, there were cutbacks
that hit much of the industrialized world. The high prices and threats of oil embargoes like
in budgets, there were a lot of adjustments that we had to make. … That period also taught us as
those of the 1960s and ’70s prompted increased exploration and production elsewhere,
individuals as well as an institution a lot in dealing with the upside, which we did in the 1970s, but
especially in Alaska, the Gulf of Mexico and the North Sea. This increased production put even Harbor pilot Mohammed Younis
also managing to work under more austere financial conditions in the 1980s.” guides an oil tanker to its berth
more oil into an already saturated market, lowering prices even further.
at Ras Tanura’s Sea Island in 1989,
The lessons learned by the developed world in the wake of the dramatic spike in oil a year in which more than half of
“The Big Picture” Saudi industry received a dramatic boost from the new sources of power and Aramco’s exports were destined
prices in 1973 and 1974 also contributed to a reduction in demand. Many industries switched
feedstocks provided by the Master Gas System and other projects that originated with the Second for Asia, followed by 25 percent
to other energy sources and installed more energy-efficient processes. In addition, individuals for North America, 21 percent for
Five-Year Development Plan. By 1986, after the MGS had been expanded to include offshore Europe, and the remainder shared
and governments took measures to conserve energy, including everything from improving
fields, Aramco had the capacity to produce up to 2 billion scfd of gas. between South America and Africa.
One aftereffect of the oil embar- home insulation to boosting auto mileage requirements to enacting lower traffic speed limits.
goes was increased exploration
By 1984, the United States was using approximately 10 percent less oil than in 1973, despite
in places such as the North Sea.
This Mobil Oil drilling rig was built the fact that the U.S. gross domestic product, adjusted for inflation, had grown by 34 percent.
in 1982 to work the Statfjord oil
field, one of the largest North
Sea fields.
In the summer of 1985, the Saudi government abandoned the quota strategy. By producing
large quantities of crude oil, Saudi Arabia hoped to regain market share from non-OPEC sources
with higher production costs. Crude oil prices plunged to levels not seen since before the 1973–1974
price hikes. In 1986, oil prices dropped more than 50 percent before bottoming out at less than
$10 a barrel. Faced with tumbling oil prices, OPEC members returned to the negotiating table in
1986. While not wholly satisfactory to anyone, the resulting revised quota system successfully
stabilized oil at between $15 and $18 a barrel through the end of the 1980s—the same price it
had sold for in 1979.
Aramco planners had based estimates of the company’s output and staffing needs for
the 1980s on late 1970s trends that had been wildly optimistic, as had planners at most major
oil companies. Indeed, the boom-and-bust trend in oil prices had frustrated industry executives
since the early 1970s and continued to do so through the decade that followed. Aramco’s aver-
age daily production hit a record high of 9.63 million bpd in 1980. Four years later, production
at times dipped as low as 2 million bpd as demand contracted. In 1985, Aramco’s average daily
production stood at 3 million bpd, the lowest since 1969.
The personal toll was dramatic. The company’s 1980 estimate that it would employ 75,000
workers by 1985 proved off the mark. Instead, the total was slightly more than 50,000 by mid-
decade, about 15 percent below its peak in 1982 of 61,227. At Aramco Services Company in
Houston, whose employees were not included in Aramco’s total employment figures for Saudi
Arabia, the payroll was cut from 2,500 to 800 during this period.
Saudi contractors and other companies that supplied goods and services to Aramco also The Sails
benefited from the construction prompted by Aramco’s expansive budgets of the early 1980s. In a
number of locations, the company trained contractors in tandem with its own new employees to Aramco formed its own shipping subsidiary, Vela International Marine Limited, in 1984.
ensure there was adequate manpower to complete its ambitious roster of projects. The dramatic Vela takes its name from the constellation Vela, part of a much larger constellation known
growth among contractors and other Saudi companies led to a considerable amount of poaching in ancient times as Argo Navis, the ship of the mythical Jason and the Argonauts. Argo
of Aramco’s talent. Navis was split up into four smaller constellations: the sails (Vela), the keel (Carina), the
Some promising trainees were recruited by Saudi companies, which often offered higher starting stern (Puppis) and the compass (Pyxis); the ships in the Vela fleet were named after stars in
salaries than Aramco. But that was the price Aramco paid for running a quality training program, said Argo Navis. Arabs had long used the stars to help them navigate their vast desert and sea
Abdulaziz Al-Hokail in 1984. “They are stars that shine in any company they go to,” he noted. “If you expanses; now these “stars” would lead Aramco’s expanding fleet of oceangoing tankers.
have been working with Aramco you are recognized. We have discipline and experience.”
Hamad A. Juraifani, vice president of Northern Area Manufacturing at the time, lamented
the departure of these young Saudis, but was able to see the contribution of the program in
broader terms: “Although we have lost a lot of experienced Saudis to the private sector, we
Saudis [at Aramco] look at the big picture: what is good for the Kingdom.”
The plunging oil prices of the mid-1980s impacted the Saudi private sector as much as
Aramco. Contractors saw their list of future projects shrivel dramatically as Aramco—and the
government—slashed construction budgets and canceled or delayed major projects. The ripple
effect was felt in virtually every corner of the Saudi economy.
“Mothballing” Aramco shuttered some facilities as crude oil production fell in the 1980s. That
made economic sense for some older operations, such as an oil processing plant in Manifa, where
the company was facing hefty maintenance and repair costs. However, for others it proved
extremely costly: A planned refinery in Qasim in central Saudi Arabia was canceled, but the cost
of terminating construction contracts and other costs made dropping the project roughly as
expensive as completing it. There had to be a better way.
While a group of executives and engineers responsible for major offshore facilities in the
company’s Northern Area Operations was exploring cost-cutting ideas, some of the group came
across an engineering journal that described the “mothballing” of U.S. Navy warships after World
War II. The executives began thinking: If it worked for warships, why not oil-processing plants?
Sadad Al-Husseini, then vice president of Northern Area Operations, put a team together to
study the issue and create a mothballing plan.
The concept was simple, but the scale was very large: Clean and store everything so
that it would not corrode or deform, and provide enough maintenance so facilities could be
reactivated quickly. Crews lifted huge rotors and turbines out of their moorings, put them in
cases and stood them on end—if left horizontal while not rotating, they would deform under
their own weight. They pumped diesel fuel through pipelines to displace all the corrosive sour
crude. Likewise, nitrogen, an inert gas, was pumped though sensitive systems and equipment
to displace corrosive oxygen-containing air. A minimal amount of power directed to instrument
systems in control rooms kept them dry. Three or four guards provided security on each major
offshore facility, minimizing personnel costs.
Facilities in the Marjan, Zuluf and Safaniya offshore fields were all mothballed using this
approach. Oil from the offshore wells served by these facilities was piped at reduced volumes
to facilities on shore for processing. GOSPs at Hawiyah, Haradh and ‘Uthmaniyah were also
mothballed. Similar mothballing was applied to facilities in Khurais, Abu Sa‘ fah, Harmaliyah The 290,000-deadweight-ton super-
tanker Phoenix Star is launched in
and Mazalij, the community at ‘Udhailiyah and the 152-centimeter pipeline running from the
November 1993 from the Nagasaki
Qurayyah Seawater Treatment Plant to the Ghawar field. shipyard in Japan, the second very
large crude carrier (VLCC) to join
Saad A. Turaiki, a production engineer in ‘Udhailiyah during the early 1980s who later became
Vela’s fleet that year. Two years
vice president of Southern Area Oil Operations, recalled that the mothballing process did not just look later, Vela, which started in 1984
at the aboveground impact of shutting in facilities. Petroleum engineers also analyzed the impact on with four secondhand tankers,
completed its three-year construction
the oil reservoirs. “We had to go and conduct studies to find out exactly what are the most critical program to build 15 VLCCs when it
areas to mothball and shut down those that will have no effect on the reservoir,” he said. took delivery of the Alphard Star.
A drilling crew works in the Safaniya

oil field in 1982. Even though world
demand for oil was dropping, result-
ing in a concurrent drop in Aramco’s
production from more than 9.6 million
bpd in 1981 to a low point of 3 million
bpd in 1985, the company kept building
production capacity in anticipation of
future demand. The strategy proved to
be prescient at the end of the decade.
The costs associated with mothballing were significant. They were paid back several times
over, however, when global demand rebounded, along with prices, beginning in the late 1980s
and continuing into the early 1990s. Mothballing expenses paled when compared to the cost
and time involved in building new facilities after demand had already started to increase. In this
manner, the mothballing program dovetailed with the company’s approach to maintaining spare
production capacity to help stabilize global energy markets.
Non-Associated Gas The overly optimistic projections that drove planning for crude oil produc-
tion as the 1980s began also impacted plans to utilize natural gas to fuel economic growth in
the Kingdom. When the MGS was designed in the mid-1970s, it was based on the assumption
that Saudi crude oil production would climb steadily to a level of 12 million to 15 million bpd
by the mid- to late 1980s. That amount of crude oil would yield a corresponding amount of
associated gas to meet much of the Kingdom’s estimated gas requirements. The rapid decrease
in oil production in the early 1980s clearly indicated that unless drastic steps were taken, Aramco
would not be able to produce enough gas to meet the country’s projected needs.
With little if any commercial demand for Saudi gas in the early decades of oil exploration,
Tanajib, where a gas-oil separation Aramco engineers had not focused on locating potential non-associated gas reservoirs. (Non-
plant (GOSP) and other facilities
were completed in 1985, became associated gas is free gas, or gas not associated with crude oil in a reservoir.) However, they had
the new hub for expanded offshore inadvertently found a large non-associated gas reservoir in the late 1940s in the Dammam Dome,
activities, including work on new
GOSPs in the Zuluf and Marjan fields.
where oil had first been discovered. Dammam Well No. 43 was deepened significantly after World
World oil markets remained weak War II as the company searched for additional sources of oil. At a depth of between 3,350 and
throughout the mid-1980s, leading
Aramco to mothball the Zuluf and
3,660 meters, the drilling crew hit what would become known as the Khuff formation, which
Marjan GOSPs, among others. contains non-associated gas.
Aramco brought six gas wells, such

as this one, on-stream from the
Khuff gas formation in 1986. As
crude oil production declined in the
mid-1980s, so did production of gas
associated with the oil; at the same
time, domestic demand for gas was
on the rise. To meet this demand,
Aramco embarked on a program to
find and produce gas independent
of crude oil, or non-associated gas.
The crew was unprepared when it struck the reservoir, and sour gas laced with toxic hydrogen
sulfide escaped to the surface under very high pressure. Fearing it might drift into Dhahran and
threaten the lives of the hundreds of workers and residents, the crew plugged the well. Drilling
shifted to other areas of the concession, and the gas well was largely forgotten.
That well may have marked the discovery of a gas-containing formation that extends
through the entire Gulf region. Khuff gas has subsequently been found in several locations in
the Kingdom, including the Haradh, Hawiyah, Shedgum and ‘Uthmaniyah areas of the Ghawar
field, as well as in the Abqaiq, Berri, Dammam, Qatif, Khursaniyah and Hawtah fields. The Khuff
formation is relatively old and deep compared with oil and gas reservoirs in the region. Most
Saudi oil reservoirs are in the Arab Zone of sedimentary deposits from the younger Jurassic
Period, deeper than the shallower reservoirs tapped in Iran, Iraq and Bahrain. Deeper, and
older still, lies the Khuff gas formation.
A team including Na‘ilah Mousli, manager of Reservoir Engineering, petroleum engineer The Smokeless Flare
Martes Yushatly and Vice President of Petroleum Engineering and Development Ed Price devel-
oped a program to revisit existing oil wells and drill deeper in search of Khuff gas. There was one In 1986, as part of Aramco’s ongoing effort to reduce the flaring of natural gas, the company
problem, however: They did not have a budget to drill for gas, and with Aramco trying to cut completed the installation of a new, modified safety flare system in Abqaiq, which dramatically
costs wherever possible during the mid-1980s, they were not likely to secure funding anytime reduced the amount of gas flared at such facilities. Flares are needed as emergency means
soon. However, with crude oil production plummeting, the team needed to do something fast. of burning excess gas, which occurs at times during the production process or in the case of
As Sadad Al-Husseini recalled: a plant malfunction or regular maintenance shutdown. The new flare consumed eight times
Whenever we had a well that was located at a promising location, I would get the less gas than the flare it replaced. In addition, its atmospheric emissions were nearly 10 times
engineers to change the program to deepen it two, three thousand feet and say we’re less than its predecessor.
doing this for structural delineation … just to tap into the gas and find it. … The oil In 1999, a young Saudi engineer named Mazen M. Mashour invented a smokeless
would be at about 7,000 feet, and we’d get down to maybe 9,000 feet to find the flare system technology that uses nonconventional methods of operation and won a Gold
Na‘ilah Mousli, Aramco’s first female Khuff [gas]. So by the time we were running out of gas because oil production was Award at the International Inventors Conference in Geneva in 2006. Mashour discovered
petroleum engineer, was also the
coming down, we had enough information on the Khuff in North Ghawar to be able that injecting a relatively small amount of high-pressure air into the flare all but eliminated
company’s first female manager, of
Reservoir Engineering, in the 1980s. to concoct a program where we would produce some of the wells as gas wells. smoke from the flares, with significant savings over larger, complex systems. His invention
Mousli received a master’s degree in
petroleum engineering from the
delivers air, under high pressure, into an air-distribution ring. Jets, contained in a wind shield,
University of Tulsa in Oklahoma The Khuff gas project officially commenced in 1983. The gas, after passing through a create the turbulence needed for smokeless operation.
and was a mentor to many other pressure-reducing and processing system, was sent into the MGS. By 1985, Aramco’s capacity
Saudi women in Aramco.
The increased airflow creates a much hotter flame, which burns off the impurities
for non-associated gas reached 1 billion scfd. As Al-Husseini recalled, “We never made as much rather than releasing them into the environment. Mashour’s smokeless flare was first
[non-associated] gas as we had designed the system for, but it was enough to see the Kingdom installed at Shaybah in June 2000 and was subsequently installed at gas plants in ‘Uthmaniyah
through many years of low oil production.” and Shedgum in 2005.
In May 2008, a joint venture agreement to produce Mashour’s invention on a commercial
“Sell My Quota” Since the 1973–74 price shock and embargo, OPEC countries, for the most scale was signed between the Al-Rushaid Group of Saudi Arabia and Zeeco, a U.S. combustion Mazen M. Mashour’s invention,
part, had wrested control of prices out of the hands of the major oil companies and tried to set shown in prototype, was designed to
technology company based in Tulsa, Oklahoma. Saudi Aramco will be the first customer,
reduce atmospheric emissions from
member-country production quotas. The system worked to varying degrees, subject to geopolitical with a project to upgrade 29 GOSPs and two other facilities in Southern Area Oil Operations gas flares without the expense of
events and each country’s willingness to adhere to its agreed production caps. more complex machinery. The system
with the new technology.
injects compressed air into the flare,
Today’s pricing methods, however, were born out of the chaos of the mid-1980s price increasing the burn temperature.
collapse. In 1985, OPEC members adopted “net-back” contracts to try to stabilize prices. Such
contracts pegged the price of crude oil to the value of a refined product, after subtracting refining
costs, margins and freight.
Molten steel provides the fireworks

in the Hadeed steel plant in Jubail,
one of many industries powered by the
Master Gas System (MGS), completed
by Aramco in 1982. Initially, the MGS
The jarring downturn in crude oil prices in 1986 sent oil producers in search of a new pric-
harnessed about 3.5 billion standard
cubic feet of gas per day, the energy ing mechanism. In December 1986, OPEC created the basket of prices, which quoted amounts
equivalent of 750,000 bpd of crude oil.
for several grades of crude from different member countries, setting the price of Arabian Light
crude oil at $17.52 a barrel. Production levels by some OPEC members, however, drove prices
down, making it impossible for Saudi Arabia—through Aramco as its major producer—to sell oil
at the official price. Nevertheless, Minister Hisham Nazer, who had succeeded Yamani as Minister
of Petroleum and Mineral Resources earlier that year, came to Aramco CEO John Kelberer in
September 1987 and said, “Sell my quota.” He did not specify a price at which he wanted the
3.3 million bpd sold. Kelberer met with Aramco senior economist William Laney Littlejohn and
said, “OK, we have to sell the quota. We can’t use net-back contracts. How do we do it?”
Littlejohn’s solution, which went into effect the following month, was used as the basis
for pricing Saudi crude oil for more than two decades. Beginning in October 1987, Aramco
priced its crude oil based on the prices for crude oil produced from a particular region, minus a
certain differential based on several factors, including the quality of the oil, the distance from
Saudi Arabia and related shipping costs. The company sold Saudi crude oil in the United States
based on the price for West Texas Intermediate oil; in Europe, based on the Brent Weighted
Average price for North Sea oil; and in the Far East, based on the average price quoted in Dubai
and Oman.
A new crude oil pipeline snakes its

way toward a notch more than 1,000
meters high in the Hijaz Mountains
in 1986. Aramco, which assumed
operation of the existing 1,200-kilo-
meter East-West Crude Oil Pipeline
from a subsidiary of Petromin in 1984,
nearly doubled the pipeline’s carrying
capacity by laying a parallel line.
By 1987, rebounding industrialized economies had increased demand for oil, and prices Aramco’s Operations Coordination
Center (OCC), seen here in the 1980s,
reversed a five-year decline. Late that year, OPEC set a reference price of $18 a barrel, far from
is the central control room for the
the $7 a barrel or less for which many types of Arabian Gulf crude oil had been selling in July company’s vast and complex oil
and gas operations. The display
1986. Aramco’s 1988 average daily production of 4.93 million barrels was the highest in six
panels on the OCC’s walls monitor
years. Rising employment levels reflected this increase. While still well below its peak of 61,227 terminal scheduling, electric power
employees in 1982, the number began to trend upward, with 43,822 employees on the payroll generation and distribution, and the
production and distribution of oil,
by 1988. gas and NGL, and refined products.
Expanded production prompted a modernization of Ras Tanura Refinery, including con-
struction of a new 250,000-bpd crude oil distillation unit and a major upgrade of Saudi Arabia’s
East-West Crude Oil Pipeline. The pipeline, 122 centimeters in diameter, at the time delivered
1.85 million bpd to Yanbu‘ for refining or export. Aramco took over operation of the crude oil
pipeline from Petromin’s Petroline in 1984, and began implementing a major expansion by
laying a parallel 142-centimeter pipeline connecting to the existing pump stations, which were
required to pump oil across Saudi Arabia and lift it over the Kingdom’s western mountains. The
second line boosted capacity to 3.2 million bpd. An additional pump station completed in 1992
increased total crude oil capacity to 5 million bpd.
Quick Response On the evening of August 15, 1987, Abdallah Jum‘ah, then vice president of
Government Affairs, found himself managing a crisis. Malfunctioning equipment at the company’s
Ju‘aymah Gas Plant had resulted in a serious fire, catching the company’s operating crews by
surprise. The only injuries were burns sustained by four workers. By responding quickly to minimize
damage and utilizing backup resources, the operating crews at Ju‘aymah managed to maintain a
continuous flow of ethane feedstock to the industrial city in nearby Jubail and elsewhere, and a
flow of NGL for export. With Aramco President Al-Naimi out of the country on vacation, Jum‘ah
became company spokesman and chief liaison officer with the government.
A young Saudi works on a globe As early as 1986, Al-Naimi had been advocating, in conversations with the Ministry of
at the Saudi Aramco Exhibit in
Dhahran in 1990. The company has Petroleum and Mineral Resources, that the company should become more of an integrated
had a permanent exhibit in Dhahran petroleum company. Rather than limiting itself mostly to the “upstream” part of the industry,
since the early 1950s to help educate
the public about the oil industry.
which includes exploring for and producing petroleum, Aramco should diversify, Al-Naimi
The current facility opened in 1986. believed, into what the industry terms “downstream” activities, which include international
refining, distribution and marketing of petroleum products.

Fin-fan coolers stretch into the
distance atop one of the two frac-
tionation modules of the Ju‘aymah
Gas Plant rebuilt in the wake of
a 1987 fire. Aramco responded
quickly to ensure the flow of ethane
feedstock and NGL to customers by
adjusting pipeline flow, reactivating
a mothballed plant and increasing
production at other active plants.
Jum‘ah’s task involved careful communication with government officials to allay fears
that the accident might have been the result of a deliberate attack and to reassure customers
that supplies of feedstock and fuel would not be interrupted. He worked closely with one of
Aramco’s leading in-Kingdom customers, Saudi Arabia Basic Industries Corporation (SABIC),
communicating critical information in the crucial period after the accident occurred. In a
subsequent meeting with Al-Naimi, then Aramco Executive Vice President Nassir Ajmi praised
Jum‘ah’s performance as well as that of the entire Aramco response team.
Khalid Al-Falih was a lead project engineer on the team that rebuilt Ju‘aymah Gas Plant.
Team members drew on years of training—and plenty of adrenaline, he recalled—getting the
crucial facility back up to speed as soon as possible: “We put parts of the plant in service right
away, and others were rebuilt in record time. So that was a highlight in terms of the intensity
of the work, the long hours, the criticality of the project for the local industry.”
Aramco also reviewed the accident from fire and safety perspectives to absorb lessons
that could be applied systemwide. “Accidents like this, as unfortunate and bad as they are,
always force you to go back and reexamine your safety systems to determine what really went
wrong,” Al-Falih noted. “In that case it was a hardware problem. Sometimes it’s people issues,
but these accidents, we learn from them, and we improve our facilities, our systems and our
human resource practices to make sure we avoid repetition of such incidents.”
A New Name Saudi Arabia’s Council of Ministers met in November 1988 and approved the
charter of a new national oil firm—the Saudi Arabian Oil Company, or Saudi Aramco—to
assume the responsibilities previously carried out by Aramco on behalf of the government.
(While the name “Aramco” no longer accurately reflected ownership of the company, it was
retained to ensure continued name recognition as well as preserve a link to the company’s rich
heritage.) The transition was seamless.
The company marked another milestone in April of that year—following the retirement of
John J. Kelberer—when then-President Al-Naimi was also named the first Saudi CEO of Saudi
Aramco, and Minister of Petroleum and Mineral Resources Hisham Nazer was named the first
Saudi chairman of the company’s board of directors.
Children’s Art Contest
For nearly three decades, Saudi Aramco has sponsored a nationwide children’s art contest,
one of the first in the Muslim world. It is open to all children in the Kingdom ages five
through 14. “The aim of the contest is to encourage our youth to continue [their]
artistic journey, climbing new peaks of beauty, imagination and creativity,” said Ismail
I. Nawwab, former general manager of Public Affairs and founder of the competition.
The contest has fired the imaginations of thousands of Saudi children and inspired many
to pursue their dreams of being an artist or working in the graphic arts. For others, the contest
Three oryx graze near a water raises their awareness of what is possible. Nasser Mohammed Al-Dowayan, currently working
hole in Nasser Mohammed Al-
Dowayan’s winning entry in the
as an engineer on a project in the Safaniya offshore field, was among the contest winners
1991 Saudi Aramco Children’s in 1991 when he was a fourth-grader in the Dhahran Ahliyyah School. “Winning the contest
Art Contest. The contest has been
firing children’s imaginations, Saudi
was an amazing experience,” he said. “It helped me understand the concept of ‘challenge’
and expatriate alike, since 1979. and made me always want to set higher goals for myself, achieve more and be a step ahead.”
The company proposed the forging of joint ventures with other international petroleum King Fahd, center, comes to Ras Tanura
in December 1986 to inaugurate the
companies to increase the Kingdom’s revenue from its oil. With the green light from Riyadh,
Aramco Training Center there. Joining
Kelberer led a team that entered into negotiations with several international downstream him are Ali Al-Naimi, company president,
on his right; Hisham Nazer, Minister
companies. In 1988, a company subsidiary formed a joint venture with Texaco in the United
of Petroleum and Mineral Resources,
States called Star Enterprise. on his left; along with members of
Star Enterprise began operations on January 1, 1989, with assets that included major the Saudi government and Aramco
management. Standing behind King
refineries in Delaware City, Delaware; Convent, Louisiana; and Port Arthur, Texas. With nearly Fahd is John Kelberer, company CEO.
4,000 employees, the joint venture also included four marketing divisions in the United States,
48 product distribution terminals and more than 11,000 Texaco-branded service stations.
While the company gained added value through its share of the profits from the refining,
distribution and marketing of crude oil products in prominent or growing markets, its efforts to
enter and expand into international downstream operations were part of a higher strategic goal.
As it secured a share of a downstream operation, the company could also secure a long-term
The winning artworks, selected by a committee of independent judges comprising agreement to regularly supply the operation with Saudi crude oil. By doing so, the company
artists, teachers and specialists in children’s art, are honored in different ways. They are secured an outlet for its oil and reduced its vulnerability to market changes.
displayed in permanent exhibits in company buildings, in-Kingdom and internationally, and
reproduced in company publications. The company also donates a selection of the contest’s New Frontiers The rebounding global oil market in the late 1980s added urgency to existing
artworks to royal embassies of Saudi Arabia around the world, and many are included in plans for more aggressive exploration. In 1986, Saudi Arabia had reassigned Aramco its original
local children’s art exhibitions sponsored by the Youth Welfare Presidency. oil exploration rights to areas that had been relinquished from both the 1933 concession and the Saudi Aramco began its trans-
formation from an oil-producing
1939 Supplementary Agreement. This enlarged exploration area amounted to about two-thirds
and -exporting company to a fully
of the Kingdom—approximately 1.5 million square kilometers—an area larger than Germany, integrated petroleum enterprise
in 1989 with the formation of Star
France and Spain combined. In 1988, a Royal Decree approved company exploration activities
Enterprise, a joint venture with
Kingdom-wide. Texaco in the United States.
In 1989, Saudi Aramco geologists and drilling teams made headway in this new exploration Exploration efforts along the Red Sea
coastal plain yielded results in 1992
campaign when they found oil in previously unexplored areas. Premium-value Arabian Super with the discovery, in the well shown
Light crude oil (which is extremely low in sulfur) was struck at a depth of about 1,900 meters at here, of sweet gas and condensate
at Midyan, near the Gulf of Aqaba.
Hawtah in central Arabia, south of Riyadh.
In the five years from 1989 to 1994, Saudi Aramco discovered 15 oil and gas fields in
the central, western and northwestern regions of the Kingdom. Found by using increasingly
sophisticated technology to peer into previously uncharted regions, these discoveries heralded
a new era of hydrocarbon exploration.
The Star Enterprise joint venture and the exploration successes, coming after Saudis had
taken over management of the company, signified a renewed vitality at Saudi Aramco. The
company continued to look internationally to increase its business over the coming years. In
response to mounting global demand for crude oil, Saudi Aramco began reactivating numerous
facilities that had been mothballed early in the 1980s. New plants and facilities were slated
for construction. Little did Saudi Aramco officials realize how fortuitous their expansion plans
would prove to be.
98 energy to the world : Volume two rising to the challenge 99
chapter four
Rising to the Challenge
Shaybah, 2003
The increasingly global role played by the

Kingdom, and consequently the company,
in the 1990s was marked by the international
conflict that convulsed the Gulf region early
in the decade. At the same time, the com-
pany continued to forge international ties
to strengthen its business while coping with
some of the most dramatic swings in world
oil prices in a generation.
At home, Saudi Aramco assumed greater responsibilities for helping develop the Saudi
economy. A new generation of Saudis assumed leadership of the enterprise and fine-tuned
operations as the company launched a new round of mammoth oil and gas facility construc-
tion projects—a harbinger of the building boom to come in the opening decade of the new
millennium.
The Gulf War The decade began with a shock, and an extraordinary challenge for Saudi Aramco.
On August 2, 1990, Iraq invaded neighboring Kuwait, putting the Saudi government—and Saudi
Aramco itself—on a crisis footing. While the government coordinated security measures both
internally and with coalition forces from around the world, the company focused on its role in
helping to stabilize world energy markets, now thrown into chaos by the invasion and subsequent
international embargo on crude oil from Iraq and occupied Kuwait.
The sudden loss of 4.8 million bpd of oil from the world’s oil markets put great pressure
on all producing countries, and both producing and consuming countries looked toward Saudi
A supertanker pulls away from Arabia and Saudi Aramco. With the world’s largest oil reserves, highest production level and
the crude oil terminal at Yanbu‘. In
highest sustainable production capacity—and a spotless record of reliability—the Kingdom and
1993, Saudi Aramco added a fourth
berth, part of a larger project to the company were expected to come to the rescue as quickly as possible.
raise the terminal’s capacity from
Before it could do so, however, the company had a more immediate concern: the security
2.6 million bpd to 4.2 million bpd.
of its workers, their families and the company’s facilities. No one knew whether the Iraqi advance
would stop in Kuwait. In the wake of the invasion, hundreds of employee dependents—most
expatriates’ families—were flown out of the country at Saudi Aramco’s expense. Many families
who were on vacation that August delayed their return to Saudi Arabia for weeks or even months.
For employees and dependents who remained, the company implemented emergency plans,
including later the distribution of gas masks.
Early in September, Minister Nazer and other Ministry officials visited Dhahran and Saudi monthly price of a barrel of Arabian Light spiked to $35 a barrel during select days in September Offshore facilities, such as these in the
Zuluf oil field in 1991, were threatened
Aramco’s facilities in a public show of government support for the company’s employees. In and October 1990, Saudi Aramco’s quick response successfully helped counter this price hike. by mines that had broken free of
private meetings with senior Saudi Aramco executives, Nazer articulated the government’s most By March 1991, the price of Arabian Light was quoted at nearly $16 a barrel, approximately the their moorings. Several mines caused
damage to Saudi Aramco offshore
pressing question: Would the company be able to boost crude oil production enough to offset same price it had been in July 1990 before Iraq’s invasion. facilities, but no lives were lost and
lost Iraqi and Kuwaiti production? oil production continued unabated.
Esprit de Corps The war months were a nerve-jangling experience for many employees and
A technician in the Abqaiq Mechanical residents living in or near company facilities. In February 1991, an Iraqi missile demolished a barracks
Shops works on a job for the project
to de-mothball a Khurais gas-oil housing U.S. troops near Dhahran, killing 28 and wounding 99. Although pieces of Iraqi missiles
separation plant in the latter half fell on company property in Dhahran, there were no casualties or significant property damage.
of 1990. Facilities mothballed in the
mid-1980s were rapidly brought back
Esprit de corps remained high among management and the hundreds of operators at onshore
online, reaffirming Saudi Arabia’s and offshore plants, including those near the Kuwait border. Bryan Bartlett, who served as superin-
commitment to providing reliable
tendent at the Safaniya onshore plant during the war, recalled the commitment shown by employees
supplies of crude oil by quickly
ramping up production to meet during the conflict: “The operators worked 14 days on, seven days off. When the bombing started
global shortfalls.
the crew that was on their seven days off were gone. … Everything was kind of going crazy. Every
single Saudi operator that I had came back to work on time. Not one single time did a man not come
back to work. … And all of our American expatriate support stayed there. Nobody left.”
The Iraqis had placed hundreds of mines in the Gulf in an attempt to disrupt shipping and sink
the vessels of the nations arrayed against them. Several mines broke loose from their moorings and
drifted into the Zuluf, Safaniya and Marjan fields, as well as off the coast of Ju‘aymah. Most of these
mines were detected while still far enough away that measures could be taken to avoid damage. Not
all of these mines, however, were detected in time. Beginning in late December 1990, three such mines
exploded under offshore platforms, causing more than $700,000 in damage, but no loss of life.
A Saudi tank crew pauses for a

photograph on January 19, 1991, two
days after the air campaign phase of
the battle to liberate Kuwait began.
A cease-fire took effect a little more
than a month later, on February 28.
Wartime Efforts Increase Production To help compensate for the loss of production from
Iraq and Kuwait, company leadership decided to “de-mothball” production facilities that had
been taken off-line in the 1980s. M. Yusof Rafie, then vice president of Petroleum Engineering,
was appointed to head the committee responsible for the massive de-mothballing effort. The
most critical challenge was finding sufficient manpower to get the plants not only back in running
order but also operating at near-capacity levels.
One obvious pool of potential manpower was a group of about 800 trainees who had
been recently recruited to work on the second major enhancement of the East-West Crude Oil
Pipeline’s capacity. That project was more than a year away from completion. Although some
officials were reluctant to have the pipeline fall behind schedule, then-Executive Vice President
Nassir Ajmi decided the recruits would be temporarily reassigned.
Saudi Aramco made the most of its experienced workforce. By mixing the newcomers
with seasoned operators, foremen and superintendents, the company was able by the end of
1990 to recommission 146 oil wells and 12 GOSPs in Harmaliyah, Khurais and Ghawar fields, as
well as the 152-centimeter water pipeline running from Qurayyah Seawater Treatment Plant to
the north ‘Uthmaniyah area of the Ghawar field. The advantage of having such an experienced “No Shutdown, No Slowdown” In addition to the ongoing security concerns, Saudi Aramco faced
workforce—the average Saudi had been with the company more than 10 years by the end of other unprecedented challenges from the war—protecting the fragile ecosystem of the Arabian Gulf
the decade—was never more apparent than that fall. Many of those who had participated in the and the major industry-related operations located on the coast. In January 1991, Saudi and coalition
1980s mothballing work were still on the payroll in 1990 and knew firsthand the steps to take to military officials detected oil drifting south in the Gulf—most of which had been discharged by
get the machinery working again. Increased supplies of oil flowed to world markets faster than Iraqi troops from the al-Ahmadi Sea Island loading terminal 21 kilometers off the coast of Kuwait.
most outside observers thought possible. Earlier in the month, the Iraqi Army had dumped the contents of several oil tankers docked at the
The de-mothballing was an enormous success, accounting for 2.8 million bpd of additional terminal and opened the taps at the terminal. Due to the circumstances, accurate accounting of
production capacity achieved during 1990. By year’s end, Saudi Aramco’s average daily production the extent of oil spilled was obviously very difficult. Minister Nazer, however, estimated at the time
was running at an astonishing 8.5 million bpd, up from 5.4 million bpd in July. While the average that Iraqi forces dumped as much as 11 million barrels of crude oil into the Gulf.
Retreating Iraqi forces set fire to Prince ‘Abd al-‘Aziz ibn Salman, then adviser to the Minister of Petroleum and Mineral
Kuwaiti oil wells in 1991, creating
massive conflagrations that took Resources, noted during a late January press conference in Riyadh that the government and Saudi
months to extinguish and wasted Aramco were working closely to deal with the effects of the massive oil slick. Nearly 70 tons of
more than a billion barrels of oil.
booms and skimmers alone were airlifted from England to the Gulf coast. In many locations,
three or more lines of booms were deployed to protect the water intake channels of company
facilities and critical government utilities such as water desalination and power generation plants.
Much of the additional equipment was sent by the Southampton, England–based Oil Spill
Service Center. The company was initially created by BP, but by the time of the Gulf War, the
center was jointly owned by 13 oil companies, including Saudi Aramco. The governments of
Japan, Germany, New Zealand, France, the United Kingdom, Canada, the United States and the
Netherlands also contributed equipment to help combat the oil spill.
Saudi Aramco’s oil spill response team was well prepared to combat the advancing slick.
Drills conducted in 1989 by the team, which numbered more than 450 workers at its peak, led to
the adoption of the company’s Oil Spill Contingency Plan in 1990. The team went to work under
the direction of Dhaifallah A. F. Al-Utaibi, then vice president of Supply and Transportation and
chairman of the company’s Oil Spill Committee. While closely following the contingency plan, team
members also quickly applied lessons learned on the job, such as which type of boom was most
effective at blocking the flow of oil in a given circumstance. Al-Utaibi spoke at the time about the
challenges created by the oil spill: “It is tough, expensive and stressful fighting the elements, but
Saudi fishing vessels sink in
so far we’re holding the line. All our facilities have been in operation since day one. … There has
an oil slick near Manifa on the been no shutdown, no slowdown of production as a result of the oil slick. Everything is intact.
northern Gulf coast in March 1991,
the result of a massive oil spill
We’re working hard to keep it together. … All conventional steps have been taken. Now we are
moving south from Kuwait. trying to think what else we can do.”
As comprehensive and thorough as the 1990 Oil Spill Contingency Plan was, the possibility One of hundreds of personnel
combating the oil spill faces a
of facing an oil slick in a combat zone during wartime had not been anticipated. The extent of the
seemingly insurmountable task
spill required that workers begin recovering oil before hostilities had ceased, making it impossible near Jubail in late March 1991. Saudi
Aramco ultimately recovered more
to adhere to some major provisions of the 1990 plan. For example, because the spill originated in
than 1 million barrels of oil from
a combat zone, there was no way to get to, and stop, the spill at its source—a primary goal of any the spill and managed to protect all
spill response effort. Even as Saudi Aramco workers were attacking the slick farther down the Gulf, coastal installations from damage
and operational interruption.
oil continued to flow at reduced rates from damaged Kuwaiti facilities until early May 1991, when
it was finally stopped. Shifting winds and rough weather only made the team’s task more difficult.
Much of the oil that might have threatened coastal facilities and communities in the Eastern
Province was trapped in two bays south of Tanajib, well north of most coastal development. The
Saudi Aramco team recovered several hundred thousand barrels of oil from these areas alone.
Nearby, the company recovered another 100,000 or so barrels that had drifted near the onshore
Safaniya oil processing plant. None of the government’s or Saudi Aramco’s coastal facilities that
depended on water from the Gulf for operations such as water treatment, power generation or
other facilities had to be shut down as a result of the unprecedented oil spill.
Mike Erspamer, the Ras Tanura Terminal manager who served as oil cleanup coordinator reporting
directly to Al-Utaibi during the Gulf War crisis, praised the Saudi Aramco crews on the job for their brav-
ery and ingenuity. He and a crew of about 30 Aramcons were laying booms to direct the oil spill away
from water intakes near the Safaniya facilities in late January 1991. The Saudi National Guard and coali-
tion forces were in the process of forcing Iraqi troops out of the northernmost portion of Saudi Arabia’s
Gulf coast and back into Kuwait. The Iraqis fired several “frog” missiles as they retreated. The inaccurate
but deadly projectiles roared over the Saudi Aramco crew at a height of less than 100 meters and landed
roughly 1,000 meters out in the Gulf. While clearly shaken, the company crew worked continuously
through the day, and for weeks afterward, to safeguard facilities from the massive oil spill.
Much of the equipment the cleanup crews used was designed in the wake of the 1989 Saudi Aramco expanded its interna-
tional presence in August 1991, when
Exxon Valdez spill off the coast of Alaska, and some of it was overwhelmed by the sheer size of a company affiliate purchased a 35
the Gulf spill and the condition of the oil, which Erspamer likened to “chocolate mousse.” Some percent interest in the SsangYong
Oil Refining Company (now S-Oil) in
of the pumps designated for cleanup duty couldn’t handle the thick mass of oil, so the engineers the Republic of Korea. The refinery
and others assigned to the project came up with an alternative. Henry Clark, manager of Offshore at Onsan, shown here, underwent an
expansion project shortly after the
Drilling, suggested they use the minivan-sized pumps that forced drilling “mud” down drill holes agreement was signed, increasing
to instead supply the force necessary to suck up the spill. Oil recovered using the pumps was its capacity to 525,000 bpd.
mixed with demulsifiers and sent to company desalting facilities for further treatment.
Saudi Aramco eventually recovered more than 1 million barrels of oil from the spill—perhaps
the largest amount of oil recovered from a spill and roughly four times the amount lost in the
Exxon Valdez disaster. The recovered oil was transferred to containment basins on land, where it
was treated to remove seawater and later used for commercial purposes. The Saudi Aramco team
may have recovered only 18 to 24 percent of the oil spilled, but this was impressive compared to
the global average recovery rate of 10 to 15 percent of most spills. Indeed, The Los Angeles Times
noted that Saudi Aramco’s ability to recover so much oil was pivotal to the cleanup effort: “Key to
the increased cleanup pace was the ability of Aramco, the Saudi-owned petroleum conglomerate,
to more than double the amount of oil it is retrieving.”
The company’s response did not end there. Environmental teams, which included employees
and volunteers from within and outside the company, worked for weeks, in cooperation with
Patti Echezuria passes a sea turtle to related government organizations such as the National Commission for Wildlife Protection and
another volunteer as part of wildlife
rescue operations in February 1991.
Development and the Presidency of Meteorology and Environmental Protection, to rescue Gulf
Hundreds of Saudi Aramco employees wildlife threatened by the spill. Saudi Aramco also conducted numerous environmental impact
joined the volunteer effort to rescue
and clean turtles, seabirds and other
studies to evaluate the spill’s toll on the coastline of the Eastern Province and adjoining areas,
animals. including monitoring the air quality.
Expanding Global Reach Even in the midst of a serious regional crisis, Saudi Aramco continued
to expand its strategic international reach in downstream operations. In 1990, the company
agreed to an equity venture with the Republic of Korea refiner SsangYong Oil Refining Company,
today’s S-Oil Corporation. The companies agreed to jointly own and operate SsangYong’s recently
completed refining facilities at Onsan.
In August 1991, Saudi Aramco announced that one of its affiliates had purchased a 35
percent interest in SsangYong Oil Refining itself. In 2007, Khalid G. Al-Buainain, senior vice
president of Refining, Marketing & International, commented that SsangYong ended up being
one of the best refining investments Saudi Aramco ever made. He called the refinery “the most
profitable refinery we have in our system today.”
Following its Korean venture, Saudi Aramco in early 1994 acquired a 40 percent equity
interest in Petron Corporation, the largest crude oil refiner and marketer in the Philippines. In May 1994, Hisham Nazer, Minister
of Petroleum and Mineral Resources,
Two years later, Saudi Aramco announced its first joint venture in Europe—the purchase
second from left, and Ali I. Al-Naimi,
of a 50 percent stake in privately held Greek refiner Motor Oil (Hellas) Corinth Refineries, S.A., president and CEO of Saudi Aramco,
third from left, visited Asia to explore
and its marketing affiliate, Avinoil Industrial Commercial and Maritime Oil Company, S.A. After
additional international opportunities.
a decade of partnership, Saudi Aramco sold its interest back to the Vardinoyannis family. In 2007,
the company reviewed Petron‘s strategic fit and the company‘s commercial return on its invest-
ment in Petron, and decided to divest its total equity interest. An acceptable price was offered
by an investor for the shareholding interest in Petron, and a sale was completed in 2008.
In 1995, the supertanker Pherkad Going Green

Star was one of three ships received
by Vela that year. This was the final
group of ships in the program that As an increasing amount of wastewater went through tertiary treatment processes, Saudi
built 15 super-tankers. In 1995,
carriers owned or chartered by Aramco started using it to improve the landscaping of its residential communities and
Vela transported 622 million barrels facilities. By the mid-1990s, the company was irrigating common areas and beautifying
of crude oil to customers in North
America, Europe and the Far East. company grounds. In 2001, a project got under way to replace the sand golf course of the
Rolling Hills Country Club in Dhahran with a grass course irrigated with treated waste-
water. This created an oasis of lush fairways and greens, along with trees and ponds that
earlier generations of Aramcon duffers could only have dreamed of. The trees and water
features of the verdant course quickly became a haven for resident and migratory birds.
Golfers enjoy a round on Dhahran’s

Rolling Hills course. The transforma-
tion from a sand course to a grass
course was made possible by the
company’s growing use of treated
wastewater for landscaping.
world-class shipping One day in 1992, Vice President of Supply and Transportation Dhaifallah
Al-Utaibi was summoned to meet with CEO Al-Naimi and Executive Vice President Ajmi in the
CEO’s office. The two executives told Al-Utaibi he had been selected to be president of Vela
International Marine, Limited. Surprised by the selection considering his relative lack of experience,
Al-Utaibi replied, only half in jest, “I don’t have a clue about the shipping business.”
Al-Utaibi proved more than capable. When he was named president of Vela in December
1992, the affiliate consisted of eight supertankers: four very large crude carriers (VLCCs), which
can carry up to 2 million barrels, and four ultra-large crude carriers (ULCCs), which can carry
more than 2 million barrels. Four smaller product tankers rounded out the fleet. An additional As of January 2008, more than 72 percent of the company’s sanitary wastewater
15 new VLCCs were on order from shipyards in Japan, Denmark and the Republic of Korea. The was being recycled for beneficial reuse via tertiary sanitary wastewater treatment facilities
fleet’s headquarters was located in a small suite of offices in the Saudi Aramco Tower Building in the company’s main communities. Reuse applications, in addition to landscape irrigation,
Captain Assem Ashary, left, became in Dhahran. included sod farming, cooling-tower water and boiler feed-water. The company committed
the first Saudi captain of a Vela ship
Al-Utaibi spent nearly four years reconfiguring Vela’s operations into a world-class shipping an estimated $750 million to build seven industrial water and wastewater projects, and an
when he took command of the Altair
Star in March 2008. Captain Bader company. He brought the management of all aspects of Vela’s business in-house, training Saudis estimated $200 million for six community water and wastewater treatment projects.
Ghouth, Vela’s operations manager,
to assume jobs that had been previously performed by a number of different European manage- Innovative technologies such as ceramic pressure exchangers and membrane bioreactors
is on the right.
ment companies. Vela’s ship management operations moved to Dubai in 1995 to take advantage were developed to raise reuse of wastewater to more than 90 percent.
of its strategic location for Gulf shipping. That same year, after the last of the 15 VLCCs ordered
in 1992 had been delivered, Vela’s fleet included 27 tankers, ranking it among the largest such
fleets in the world. During Al-Utaibi’s time at the helm, Vela began a track record as a leader in
safety and operational efficiency in the maritime transportation industry. As a result of the merger, Saudi Aramco assumed responsibility for operating eight termi-
nals on the Red Sea for shipping and receiving crude oil, NGL and other refined products. The
Domestic Integration The company’s international ventures in the 1990s were accompanied company also took over operation of the Kingdom’s petroleum product distribution network,
by a domestic transformation. A few years previously, in 1988, the government had created, as which included 18 bulk storage plants and 14 air-fueling units at airports.
part of Petromin, the Saudi Arabian Marketing and Refining Company, or Samarec, tasked with Now the responsibility for operating the Kingdom’s domestic oil refineries and distribution
refining, marketing and distributing refined products. On July 1, 1993, King Fahd issued a Royal facilities and its joint-venture export refineries belonged solely to Saudi Aramco. With a stroke
Decree sanctioning a June 14 decision by the Council of Ministers, merging the operation and of his pen, King Fahd had transformed Saudi Aramco into the world’s third-largest refiner after
facilities of Samarec into Saudi Aramco. Exxon and Royal Dutch–Shell.
The merger transferred a series of assets and responsibilities to Saudi Aramco. Among
these were three domestic refineries: a 190,000-bpd refinery at Yanbu‘, a 140,000-bpd refinery “A Seamless Organization” Like most Saudi Aramco employees, Khalid Al-Falih, at the time
at Riyadh and Petromin’s 75 percent stake in Jiddah’s 90,000-bpd refinery—the remaining 25 a general supervisor in the Consulting Services Department, learned about the merger when
percent of which was held by local private investors. Saudi Aramco also assumed Petromin’s 50 he picked up the newspaper one morning in mid-June 1993. As was the case with 10 other
percent stake in its three joint-venture export refineries: a 320,000-bpd refinery with Mobil in senior Saudi Aramco employees, Al-Falih also quickly learned that he had been drafted by senior
Yanbu‘, a 300,000-bpd refinery with Shell Oil in Jubail and a 325,000-bpd refinery with Greece’s management to help execute the integration of Samarec’s in-Kingdom facilities and its employees
Petrola in Rabigh. into Saudi Aramco.
New Leadership In 1995, after finishing a round of international meetings with Saudi Aramco’s
refining equity venture partners in the Philippines, President and CEO Al-Naimi flew to Alaska for a
vacation. He had already donned his waders in anticipation of a day of fishing on a remote stretch
of river when he received a phone message. Someone back in Jiddah was trying very hard to get
in touch with him. He did not recognize the phone number, but he thought he ought to return
the call in case it was critical. The message was from a senior adviser to King Fahd telling him to
return to Saudi Arabia immediately. He had been appointed Minister of Petroleum and Mineral
Resources and needed to be back in time for the official ceremonies. “It was a complete surprise,”
Al-Naimi recalled.
Al-Naimi’s appointment opened up the president and CEO positions at Saudi Aramco.
Since the retirement of Executive Vice President Ajmi at the end of 1992, four executive vice
presidents had served directly below Al-Naimi. Nabil I. Al-Bassam was responsible for Finance
and Government Affairs; Abdulaziz Al-Hokail was in charge of Human Resources and Training;
Dr. Sadad Al-Husseini headed Engineering, Exploration, Production and Industrial Services; and
Abdallah Jum‘ah led International Operations and Joint Ventures. Eventually, Jum‘ah, who was
known for his strong people skills as well as international experience, was chosen to succeed
Al-Naimi as president and CEO of Saudi Aramco. His skill set was widely viewed within the company
as complementary to that of Al-Naimi, who had spent much of his career at the oil company in
operational roles.
Al-Naimi and Jum‘ah developed a close working relationship during the early 1990s as they
negotiated several international deals. Jum‘ah—the first company president not trained as an
engineer or geologist—earned his undergraduate degree in political science, and his management
approach and skills were fine-tuned through diverse business assignments and his participation
in Harvard University’s executive management program. Al-Naimi recognized Jum‘ah’s potential
and helped him broaden his understanding of the oil business. As Jum‘ah recalled, “At that time
I was traveling a lot together with him. That was close, you know, walking at night or jogging at
night in Holland or in London. He was throwing things to me to get me interested in the technical
side of the business. …”
Plant operators monitor refinery The integration team moved to Jiddah, where Samarec was based, and immediately began
operations in a Saudi Arabian
working with Samarec management to merge the two organizations as quickly and smoothly as
Marketing and Refining Company
(Samarec) control room in 1988. Five possible. The team eventually swelled to 200 members to better deal with complex infrastructure,
years later, Samarec’s operations
hydrocarbon system, financial and human resources issues.
were merged with Saudi Aramco’s. Developing Potential
The immediate challenge was to restructure the company’s operations to more effectively
fulfill its new role. The integration team determined that Saudi Aramco’s organizational structure,
To help develop the brainpower needed to guide the company in the future, Saudi Aramco
processes and systems should become the model for the newly merged entities. “The govern-
started its College Degree Program for Non-Employees (CDPNE) in 1987, providing educa-
ment felt that rather than reinventing the wheel, and creating all of these systems and practices,
tional assistance to promising Saudi students as they finish high school. The program is a
it would be best to adopt some system that we know already works, which is the Saudi Aramco
highly selective scholarship opportunity for male and female Saudi high school science graduates.
system,” Al-Falih said.
The company provides free lodging and pays students a monthly stipend while they attend
On August 8, 1993, 11 days after the merger task force completed its work, Saudi Aramco
a one-year college preparatory program. Those who successfully complete the program are
announced a revamped organizational structure. Having eliminated redundant roles and responsibilities,
enrolled in a university of Saudi Aramco’s choice and follow a mandated program of study.
a newly enlarged Saudi Aramco was poised to exploit the advantages of a centralized organization.
Students must maintain a required academic standard throughout their years of study. If a
Among other areas of expertise, Samarec had experience running a highly effective domestic marketing
graduate of this program is offered employment by Saudi Aramco and passes the mandatory
campaign, which had generated sales that produced a profit of $22 billion from 1988 through 1993.
90-day probationary period, the years of study are included in the employee’s term of service
The merger was operationally complete within six months. The assimilation of more than
with the company.
10,250 Samarec employees and approximately 1,600 expatriate contractors into Saudi Aramco’s
“We see ourselves as seeds planted by Saudi Aramco,” said Ayed Al-Qahtani, who
workforce increased the number of employees by approximately 25 percent, though fully integrat-
since 1993 has earned bachelor’s and master’s degrees, and in 2008 received a doctorate
ing them understandably took several more months to accomplish.
degree in energy economics from the Colorado School of Mines in the United States. Scholarship student Munif Al-Munif
“Today,” noted Al-Falih, “it’s a seamless organization. We look across the assets and across consults with George J. Mollo, Jr., in
“This whole effort has been an orchestrated, long-term investment by the company, with
the employees, and it’s very difficult to distinguish an employee as having been ex-Samarec or June 2007. Saudi Aramco has been
harvests along the way.” In the 20 years since the inception of CDPNE, more than 2,700 providing its scholarship students
ex-Aramco. Everybody’s a Saudi Aramco employee, and the assets have all been upgraded and with both financial support and
employees have earned college degrees through the program.
standardized in the same manner.” counsel from experienced advisers
for decades.
Transcending the Technical Over his years with the company, Jum‘ah developed a valuable
insight that served the company well: Despite the focus on materials and technology inherent in
the oil business, the true core of Saudi Aramco was its people. Adopting a merely technocratic
approach to the business was naturally not Jum‘ah’s style, and he believed that human resources
issues often lie at the heart of what might initially appear to be distinctly operational problems,
especially in a company with such a strong engineering and technical heritage.
Attention to the human side of the business prompted almost immediate steps to change
the face of the company. In 1996 and early 1997, a number of industrial leaks, accidents
and other problems at Saudi Aramco suggested that a review of operations was in order.
None of the events was catastrophic, but collectively they were more than management
was willing to tolerate. Jum‘ah felt management needed to dig beyond technical problems
to find long-term solutions.
Jum‘ah asked Al-Utaibi, who by this time was senior vice president of Engineering and
Operation Services, to head a committee to investigate the issue and develop recommenda-
tions. Al-Utaibi was the right man for the job, recalled Bryan Bartlett, a committee member:
“He wasn’t afraid of anything. He wasn’t afraid of anybody. He was also loyal to the company,
and he worked us to death for two or three months.” The committee went throughout the
entire company, interviewing people and engaging company psychologists and other experts
Company geologists on a 2008 field to create and analyze surveys.
trip in the mountains of northern The group developed a “health of the company” report, which Al-Utaibi presented to
Oman get a firsthand look at rock
formations that, in the Eastern management. Subsequently reviewed by Jum‘ah and the company’s senior vice presidents, the
Province of Saudi Arabia, lie buried report was bitter medicine for some Saudi Aramco executives who did not appreciate hearing
hundreds and thousands of meters
underground. The detailed study of
long-standing company practices criticized. But sound leadership depends upon honest feedback,
rock outcrops at various sites through- and many of the recommendations included in the report were implemented. Compensation
out the Arabian Peninsula helps
geologists develop more accurate
policies and shift schedules were improved for employees living and working offshore. Recognition
models of hydrocarbon reservoirs. programs for awards and merit were altered as well.
Three-dimensional seismic technology, as the name suggests, adds depth to the length and A convoy of thumper, or vibroseis,
trucks crosses the desert near Abqaiq,
breadth recorded by 2-D technology. The 3-D seismic imaging produces a much more detailed
part of an exploration survey. Large
image of underground reservoirs. This allows geoscientists and petroleum engineers to make vibrating plates mounted on the
undercarriage of the trucks are
better decisions about where to place wells to maximize the amount of oil and gas that can be
lowered to the ground to create
drawn from subterranean structures. sound waves that are recorded by
The company used 3-D seismic imaging as early as 1979 on parts of the offshore Marjan field. sensors. This data is crunched by
computer programs to produce 3-D
But cost-cutting associated with the oil industry slowdown and low oil prices of the mid-1980s images of the subterranean struc-
left company officials leery of spending on such advanced technology beyond small amounts at ture for analysis by geoscientists.
experimental levels. It was not until 1991 that Saudi Aramco initiated its first onshore 3-D program,
at Abu Jifan. The following year, three more 3-D surveys were completed, at Hawtah, Ghinah
and Hazmiyah, as part of the initial development of these central Saudi Arabian oil fields. From
Technology Updates In the 1980s, Saudi Aramco lagged technologically behind some that point forward, 3-D became an integral part of the exploration process at Saudi Aramco.
international oil companies. The relative accessibility of its largest fields, overall low produc-
tion costs and the significant costs of new technology kept it from being a top priority for Going Horizontal At roughly the same time that Saudi Aramco was embracing 3-D technology
the company. in exploration, it was warming up to another new technology as well—horizontal drilling. For years,
Two-dimensional seismic imaging had been used in a relatively simple form as early as due to the cost and difficulty of locating multiple drilling platforms offshore, the company had
the 1920s in the United States and Europe to help identify possible hydrocarbon reservoirs in been drilling offshore wells at varying angles, as opposed to traditional vertical wells. Horizontal
sedimentary rock formations. More advanced forms had long been used by the company. For drilling takes the concept one step further: Wells begin as vertical wells, then at a certain depth
several decades after seismic technology came into use, dynamite was used to create shock the drill bit is turned to drill horizontally at a specific angle to reach a particular target within the
waves that were recorded as they bounced back from underground formations, much the way hydrocarbon reservoir. Not only does the horizontal technique allow for targeting hard-to-reach
earthquakes are recorded on seismographs. Today, huge trucks press large vibrating metal plates reservoirs, but it also enables the reservoir engineers to better manage production and reservoir
against the ground, causing strong pulsations to penetrate the earth. Sophisticated geophones depletion issues by drilling the wellbore across the widest dimension of oil-bearing strata in a
capture the resulting echoes returning from formations and faults in the rock below. reservoir, rather than down through it.
Horizontal drilling, first employed by The international oil companies were using the technology for exploration. We
Saudi Aramco in 1991, proved key to
extracting oil from difficult-to-reach took the technology and applied it to reservoir management. They would use 3-D
reservoirs. An additional benefit over seismic to discover an oil field which was small, so they needed the seismic, and then
vertical drilling was that it greatly
increased the contact the producing
they would drill it with a horizontal completion, or a few horizontal completions, to
well could have with the reservoir. get the most out of it, and then they would walk away. To them, that was the end
of the game.
To us, that was the beginning. We would go to an oil field, [and] we would
shoot the 3-D seismic to say, OK, now what can we say about this field? How can
we link rock properties to seismic properties to fill in the gap between one well
and the next, to create a database that really reflects what the field looks like? And
then how can we use the horizontal drilling—eventually multilateral horizontal
drilling—to optimize the recoveries from the zones that we have no control over
in between the wells and so on at the surface? So they had the technologies, but
they weren’t looking at the problem that we were looking at. They couldn’t care
in terms of ultimate recovery.

Overseeing the development and production of all the crude oil and gas reserves of Saudi
Aramco is the responsibility of Reservoir Management. The work here is among the most tech-
nologically advanced of its kind in the world, ranking with the best of such endeavors among
leading international oil companies. The huge number of the company’s computer clusters make
it, in terms of computing power, among the top commercial computing centers in the world.
This massive computing power is used chiefly to run simulation models. Reservoir simulation
is a 3-D mathematical representation of the total petroleum system, including the reservoir and
its associated aquifer, wellbore and surface facilities. These models are the primary tool used to
locate, develop and manage oil and gas reservoirs.
Thirty years ago, reservoir simulation consisted of creating 3-D models using a few thou-
sand “cells.” Each cell represented a cube-shaped portion of the reservoir, measuring about two
Petroleum engineers Amal A. Al-Awami,
kilometers on each side and with a depth of from 15 to 30 meters. This technology was a big right, and Mubarak N. Al-Dossary
improvement over the 2-D seismic images used for decades in the industry, but it did not provide model a hydrocarbon reservoir in one
of the 3-D visualization rooms housed
much specificity in terms of placing wells or understanding reservoir characteristics. The models in the Exploration and Petrolem
Saudi Aramco completed drilling its first successful horizontal wells in the offshore Berri also took weeks for mainframe computers to produce. Engineering Center in Dhahran.
field in January and April 1991. The first Berri well was drilled vertically to about 1,980 meters
and then at a horizontal angle for another 2,700 meters to its predetermined target “window,”
which was only about 6 meters in diameter. Once in the oil-bearing rock, the horizontal well
remained in contact with the oil-bearing strata for 760 meters. If a traditional vertical well
had entered the same strata, it would have been in contact with the oil-bearing rock for only
about 40 meters.
As Al-Husseini, who retired in 2004 as executive vice president of Exploration and
Producing, later recalled, “When we did it at Berri, suddenly the wells that were producing
2,000 barrels and 1,500 barrels [per day] were coming in at 5,000 to 6,000 barrels, because
of the horizontal drilling. So that made people sort of say, ‘Well, this isn’t just for fun; there is
some advantage here.’”
Ultimate Recovery In the early 1990s, Saudi Aramco officials visited several international oil
companies to gauge the latest in exploration and production technologies. The team realized
that 3-D seismic and horizontal drilling were especially well suited to the company’s increasing
emphasis on long-term reservoir management, and its role as steward of the Kingdom’s oil and
gas resources. Saudi Aramco immediately also saw the value of the latest technology called
multilateral drilling. Using this technique, drillers extend wells off of a common horizontal well,
much like fingers on a hand, allowing them to target specific pockets of hydrocarbons. As
Al-Husseini later recalled:
The Core Store
Saudi Aramco rightly boasts of its technological prowess and computing power dedicated
to analyzing its hydrocarbon-bearing reservoirs and prospective fields. Yet one of the most
vital tools in its analytical arsenal is in many respects deceptively low-tech. Inside a nondescript
building in Dhahran’s light industrial park is the company’s Well Samples and Laboratory
Unit, popularly known as the Core Store. The cavernous structure houses more than 240
kilometers of core samples and is “the backbone of all the studies that have to do with
finding more oil and developing more fields, with the prosperity of the country and of our
whole operation,” said Haytham Ahmad A. Al-Tayyar, a geological consultant with the
Geological Technical Services Division who retired in July 2007.
Every core sample yields a wealth of knowledge about the hydrocarbon reservoir
from which it comes. Core samples—and drill cuttings—are the only direct, hands-on contact
anyone has with a hydrocarbon reservoir, thus allowing geologists to see the reservoir, and
its component rocks and fluids. “Cores are the ground truth for everything else we do,” chief
technologist of EXPEC’s Advanced Research Center Dave Cantrell said. “All the other data we
collect is indirect. We need the kind of data supplied by cores to keep our models honest.”
Aus Al-Tawil, left, discusses a

core sample with fellow geolo-
gist Nasser Al-Ghamdi. The rock
cylinders provide direct contact
with the component rocks and
fluids of a hydrocarbon reservoir,
and thus hold a wealth of clues
as to whether economically
producible oil and gas, and how
much of it, may lie in a reservoir.
Ghawar, the world’s largest oil field,

measures about 280 kilometers long
and up to 26 kilometers wide. This
3-D model shows the entire field,
which lies 1,648 meters to 2,472
meters beneath the Earth’s surface.
The colors represent depths below
sea level, from red at the higher level
to yellow and green deeper below.
Saudi Aramco’s state-of-the-art parallel-processor computer system provides a much

clearer idea of what is going on in these underground structures. Today’s reservoir managers,
using Saudi Aramco’s proprietary technology developed in-house called POWERS—Parallel Oil Core samples are taken from a zone of interest in a well, not from the entire depth, and
Water and Gas Reservoir Simulator—generate models comprising several million cells, with each not every well is cored because it is a time-consuming and costly procedure. Core samples
cell measuring roughly 125 meters on a side and 30 centimeters deep. Even higher resolution are handled carefully at well sites where they are cut, labeled and packed into protective
models are not out of the question in the foreseeable future, given that rapid advancements crates and trucked to the lab in Dhahran. There, the cores go through a four-step process that
in computing power show few signs of abating. The 278-teraflop (278 trillion calculations per includes prep work, sampling, analysis and archiving. “The more rock you look at from more
second) computing capability of the EXPEC Computer Center in 2008, for example, represents a wells, the better you understand how it’s all put together,” explained Aus A. Al-Tawil, chief
485-fold increase in Saudi Aramco’s computing capacity since 2000. And in November 2008, the geologist of the Reservoir Characterization Department. “You start to unlock the story of the
company’s next-generation prototype version of POWERS completed its first giga-cell (billion-cell) reservoir, and with more data from other disciplines, the story becomes more complete.”
reservoir simulation run.
Reservoir management experts industry-wide are taking the same approach used in
visualization and applying it on the microscopic level to the porosity and permeability of the
rocks in oil- and gas-bearing strata. For the past several years, Saudi Aramco has been using
computer-aided tomography (CAT) scans and magnetic resonance imaging (MRI) techniques to
obtain a better understanding of oil-bearing rock at the microscopic level.
Managing for the Future Taming Shaybah Development of the Shaybah oil field deep in the beautiful but unforgiving
Rub‘ al-Khali—on time and within budget—was in many ways the pinnacle of Saudi Aramco
Saudi Aramco’s Reservoir Management Department is responsible for managing the Kingdom’s achievement in the 1990s. The vast desert’s deserved reputation as one of Earth’s most inhospitable
hydrocarbon resources to maximize recovery over the life of the reservoirs. That is a weighty places made early expeditions, beginning in the late 1930s, few and far between and delayed the
responsibility, considering that the Kingdom’s proven crude oil reserves, at roughly 260 development of the region for decades. Geologists surveyed the barren region’s northwestern
billion barrels, are the largest conventional reserves in the world, and its natural gas reserves stretches in 1938, and again in 1948, but exploratory drilling did not occur until the late 1950s.
of 263 trillion cubic feet rank as fourth largest. In 1968, a drilling team struck oil at Shaybah Well No. 1.
The key to sound reservoir management lies in controlling the pace at which oil is extracted. At the time, traveling the 800 kilometers from Dhahran to Shaybah by land could take
International oil companies tend to focus on extracting oil as quickly as feasible to recoup up- longer than a week. Small airplanes reduced the trip to a few hours, which provided a solution
front exploration and development costs and to reward shareholders. Saudi Aramco, on the for transporting people, but the vast quantities of supplies needed to sustain a drilling camp and
other hand, has longer-term goals, striving to maximize hydrocarbon recovery from its fields. build oil and gas facilities required trucks. Technical and economic reasons made Aramco, in the
Rapid production of oil from reservoirs risks damaging the oil-bearing strata by promoting the late 1960s, hesitant to establish a permanent operation at Shaybah, where summer temperatures
rapid infiltration of water into rock layers from which oil is being drawn, among other things. often hit 50 degrees Celsius and sand dunes tower up to 300 meters high. Company officials
Geoscientists analyze seismic The company’s policy for decades has been to produce oil gradually from its fields— feared the shifting sands might bury buildings even if they were erected on the sabkhahs, the
data in November 1992, the year narrow salt flats between the dunes.
not maximizing short-term profits, but managing the flow of oil in the reservoir for optimal
when the company first began
using 3-D seismic surveying in recovery. Thus, the benefits to the Kingdom from its hydrocarbon resources are extended to By the 1990s, improvements in technology and decades of measurements suggesting that
Abdallah Jum‘ah, president and CEO
reservoir development operations the sabkhahs remained consistently free of drifting sand alleviated concern. Continuing advances
the longest time possible, and the reliability of crude oil supplies to world markets is sustained. of Saudi Aramco, center, leads a man-
to more accurately delineate
known reservoirs. Partly as a result of their tendency to produce oil more rapidly up front, international in computing power, 3-D seismic imaging technology and horizontal drilling gave the company’s agement team on a March 1997 visit
to the Shaybah project. On Jum‘ah’s
oil companies as a group tend to recover on average less than 50 percent of the oil in a given geologists and engineers a much more detailed look at the Shaybah reservoir than had been left is Sadad Al-Husseini, execu-
reservoir, estimated Nansen Saleri, who for many years oversaw Reservoir Management for available for any previous drilling target of this magnitude. What they found was astounding: tive vice president of Exploration &
Producing (E&P), and on his right, in
the company. Saudi Aramco’s recovery rates are well above that. Recovery rates in some fields To put Shaybah in perspective, the field holds as much oil—more than 14 billion barrels—as the
the white shirt, is Abd Allah Al-Saif,
have reached 55 percent of original oil-in-place and are on target to ultimately reach 70 entire North Sea reserves. It contains 25 trillion cubic feet of natural gas as well. senior vice president of E&P.
percent. The remaining 30 percent is typically so tightly bound to the rock that short of actually
mining the oil-bearing rock and hauling it to the surface for processing, it is considered
unrecoverable with current technologies. Emerging technologies, however, can further
improve recovery rates beyond 70 percent.
The next step will be to create animations to model the processes occurring within individual
pores of oil-bearing rock in order to plan the most effective oil and gas recovery methods. The
capability to view reservoirs in such detail already exists on one level—Saudi Aramco can visualize
how fluids are moving through a reservoir by using historical data to build a model. The company
can create video animation of a drill bit passing through a particular stratum of a reservoir based
on sensors feeding back real-time data from the drill and well fluids. The limits to future reservoir
simulation are likely to have more to do with the human imagination than the technologies
available to the intrepid petroleum engineer.
Advancements in reservoir management and production technologies grew apace in the
light of supply dislocations caused by the Gulf War, which underscored the need for additional
production capacity to meet the challenges of the rapidly evolving world energy markets. In
1994, the company completed a five-year program to raise its maximum sustainable crude oil
production capacity to 10 million bpd, giving the Kingdom the largest spare production capacity
of any country in the world at a time when almost all oil-producing countries were producing at
or near capacity.
In late 1997, for the first time in four years, OPEC decided to increase its production ceiling.
The 10 percent increase to 27.5 million bpd took effect in January 1998. Unfortunately, it occurred
almost simultaneously with a financial crisis that swept much of Asia, sharply reducing the region’s
demand for crude oil. Consecutive warm winters in North America and Europe in 1996 and 1997,
combined with the dearth of Asian demand, led to an increase in world oil inventories and drove
prices sharply lower. The price of oil slid through much of 1997, after hitting $22 a barrel in late
1996, and plunged to below $10 a barrel in late 1998.
The logistics of developing Shaybah were mind-boggling. Until a road was graded through In the Footsteps of Khamis
the sand dunes, materials had to be brought two-thirds of the way by contracted trucks and
then transferred to Saudi Aramco’s specially designed deep-desert vehicles, which carried the Legendary Bedouin guide Khamis ibn Rimthan’s desert-reading skills live on in Quriyan M.
supplies the rest of the way. In 1996 alone, the company used 300 trucks to transport more Al-Hajri, a desert road–building supervisor in the Drilling and Workover Department. Al-Hajri,
than 3,800 loads weighing a total of 90,000 metric tons to the construction site. A paved the great-grandson of Bedouin herdsmen, and his crews crisscross large parts of Saudi Arabia
access road was needed, however, and contractors built a 386-kilometer road across previously as they prepare access roads and drilling sites.
trackless desert. The construction took 12 months and was completed three months early, due
in part to the 1,300 workers dedicated to the project and the 533 pieces of heavy equipment
used to move nearly 15 million cubic meters of dirt and sand. To build the road more quickly,
Saudi Aramco arranged for the access road to be built by three different contractors, which
simultaneously worked on different sections.
The road was constructed by collecting earth from marl pits, clay-like soil with good bonding
properties, and depositing it along the road’s path. Once laid, the marl was watered and then
Deep in the Rub‘ al-Khali, con- compacted by heavy equipment. This process was repeated several times to form layers, or “lifts,”
struction crews lay pipe parallel to
the Shaybah access road in August
of watered and compacted material to ensure the road’s reliability. After the road was completed,
1997. The pipeline carries oil 645 the trip from Dhahran to Shaybah could be made in less than 12 hours. A concrete runway large
kilometers to Abqaiq, where
enough for a Boeing 737 followed 10 months later. With the regular delivery of supplies ensured,
it is processed for export from
Ras Tanura and Ju‘aymah. construction on facilities there continued at a rapid pace.
Following desert landmarks during the day and the stars at night, Al-Hajri relies on Quriyan M. Al-Hajri and Richard
G. Moffitt check map coordinates
orienteering skills honed during his boyhood in the early 1960s when he helped his family
near the Haruri airstrip about 200
herd their camels in search of fresh grass and water. He joined Aramco in 1979 after working kilometers northwest of Abqaiq
in the spring of 2004. The two
for several years with a company contractor. While he and all employees in the department
men were scouting the proposed
are trained in using Global Positioning System (GPS) navigational devices, Al-Hajri prefers to location of an exploration well site.
rely on his innate skill. “I’m afraid that if I don’t use it, I will lose the knowledge,” he said.
“Our people may have to stay one or two nights out in the wilderness, dealing with
whatever comes up,” said Neil Brown, Wellsites Division superintendent and longtime
friend of Al-Hajri.
Al-Hajri once spent six months living in a tent high atop one of the red dunes in the
Rub‘ al-Khali, helping direct road construction through the desert to Shaybah. Every night,
Al-Hajri would light a fire and serve Arabian coffee for the weary workers. His tent became
a focal point for relaxation and socializing for the people on the project, 800 kilometers
south of Dhahran.
An appreciative guest of Al-Hajri’s hospitality nominated him for Employee of the Year
in 1996, noting in the nomination letter that Al-Hajri’s tent was a place “where people of all
nationalities could relax from the rigors of the day [and] has become a well-known feature
of Shaybah and has helped tremendously to maintain morale and bring a certain kind of
normality to an abnormally difficult area to work and live.”
Discovered in 1968, the Shaybah oil

field, located 800 kilometers south
of Dhahran in the Rub‘ al-Khali, was
held in reserve until technological
challenges and other factors could
be resolved.
Expanding in the United States Enabling easy air and ground transportation to Shaybah was only part of the challenge.
The project also included construction of three GOSPs and scores of horizontal wells, scattered
In 1998, Saudi Aramco joined the top ranks of the U.S. gasoline marketing and refining across the oil field.
industries. Saudi Refining Inc., a subsidiary of Houston-based Aramco Services Company, A 645-kilometer pipeline was constructed to transport the oil from Shaybah to a processing
and Texaco merged their Star Enterprise joint venture with Shell Oil assets in the southern center in Abqaiq. To avoid the time and expense of building and maintaining a pump station in
and eastern portions of the United States to form Motiva Enterprises, LLC. The transac- the deep desert, the oil is kept at high pressure, roughly 45 kilogram per square centimeter, after
tion included a 20-year oil supply contract, obligating Motiva to purchase a minimum of leaving the wells. Housing and recreation facilities to accommodate 1,000 men were also built.
450,000 bpd of Saudi crude oil. The ownership changed when Saudi Refining Inc. and Shell The marquee 500,000-bpd project had the undivided attention of new CEO Jum‘ah and
purchased Texaco’s interest and became 50-50 partners in Motiva as a result of the 2002 his management team. Dozens of Saudi-owned companies and top international engineering
merger of Texaco and Chevron. The refining and marketing alliance covers a 26-state area of and contracting firms were enlisted for the project. Many of the Saudi partners were involved
the United States and ranks as the second-largest retail gasoline marketer in that country. from an early stage as the company pursued an accelerated contracting process to streamline
planning, bidding and construction.
In July 1998, three years after the development effort began and 30 years after the discovery
of oil there, Shaybah opened for production. In March 1999, King ‘Abd Allah, then Crown Prince,
inaugurated the $1.7 billion project, which represented not only an extraordinary technical and
logistical achievement, but a cultural milestone as well. In a significant development for the
company and the Kingdom, 90 percent of the team in charge of the Shaybah project was Saudi.
Oil prices rebounded from their 1998 lows as demand from Asia picked up and OPEC
reduced production quotas, but the price collapse nonetheless reverberated throughout the
industry. The mergers of Exxon and Mobil, BP and Amoco, and Total Fina and Elf Aquitane
during this period were all driven at least in part by a desire to reduce operating costs in the
face of lost revenue. Investments in capital programs worldwide all but dried up for several
years for the same reason, setting the stage for oil production and refining capacity constraints
in the following decade.
Lessons Learned Jum‘ah later conceded that the intense focus on Shaybah caused the company
to briefly let its attention slip from another contemporaneous project: the $1.3 billion upgrade of
the Ras Tanura Refinery. The complex refinery project had started four years before Shaybah, but
was completed two years behind schedule, the same year as the development of the oil field.
King ‘Abd Allah, then Crown Prince,

center, with President and CEO
Abdallah Jum‘ah, on his right, and
Ali Al-Naimi, Minister of Petroleum
and Mineral Resources, on his left,
are accompanied by members of
the royal family and company man-
agement—and one young guest—
on a visit to Dhahran in April 1999
This Shell station is part of Following the merger, Motiva had four refineries until the 2004 sale of its for inaugurations of the Ras Tanura
Motiva Enterprises, a joint Refinery upgrade and a pipeline
Delaware City, Delaware, refinery. Its remaining refineries in Louisiana and Texas linking bulk plants at Dhahran,
venture between Saudi Refining
Inc., a subsidiary of Houston- have a total combined capacity of about 740,000 bpd, to go with its almost 8,000 Qasim, Riyadh and al-Hasa.
based Aramco Services Company,
service stations. Ground was broken in December 2007 on a project to nearly double
and Shell. Motiva refines and
markets gasoline under the Shell the throughput of Motiva’s Port Arthur, Texas, facility from 325,000 bpd to 600,000
brand in the southern and eastern bpd, which will make it the largest U.S. refinery and one of the largest in the world.
regions of the United States.
The expansion will supply additional gasoline, diesel and aviation fuels under
the Shell brand to wholesale and direct supply markets. The refinery will be able
to process heavy crude oil as well as bitumen from Canada’s oil sands. In line with
the environmental commitments of Motiva’s parent companies and strict U.S.
regulations, the plant will lower most types of emissions on a per-barrel basis, espe-
cially ozone precursors such as nitrogen oxides and volatile organic compounds.
Despite delays in construction, the Ras “We made the horrendous mistake of … not doing the inspection ourselves because at position of higher authority, so they could apply what they had just learned. The company also
Tanura Refinery upgrade, completed
that time we were trying to economize. [Oil] prices were low and we were trying to cut costs put operating and project management personnel on integrated teams so they worked more
in 1998, four years after this photo
was taken, was a valuable addition as well as we can, so we sort of turned [over] a lot of the activities that we should be doing to closely together. In addition, Total Quality Management programs, a series of subprograms
to company facilities. The improve-
contractors without proper attention,” Jum‘ah said. He recalled that while he and the manage- and guidelines to improve project management, were introduced in 1994 and were reinforced
ments increased the percentage of
high-value products, such as gasoline ment team were going to Shaybah nearly every month during the construction process, he from 1998 to 2002 in the wake of the delays at Ras Tanura to keep Saudi Aramco on the path
and diesel fuel, that the refinery can could only remember visiting the Ras Tanura Refinery once or twice during the upgrade. of continuous improvement.
produce from each barrel of crude oil.
“We certainly failed in Ras Tanura, but that failure was an eye-opener,” Jum‘ah said. Concurrent with the Shaybah development and Ras Tanura Refinery upgrade, Saudi Aramco
“To me, Ras Tanura was a hard lesson from which we emerged subsequently to be masters was also bolstering its domestic product network, building a series of pipelines to transport
of megaprojects.” refined products such as diesel, gasoline and kerosene to and from its bulk plants at Dhahran,
As a result of the setback at Ras Tanura, project management, construction and engineer- Qasim, Riyadh and al-Hasa. Included in the project were new bottom-loading facilities for tanker
ing teams reexamined their practices and began consistently benchmarking their efforts against trucks at the North Riyadh Bulk Plant, which eliminated operator exposure to product vapors.
international standards. In 1995, the company had joined the U.S. Construction Industry Institute, The network provided many benefits, including increasing operating efficiency and the reliability
to take advantage of its best practices experience, and sponsored a chapter of the Project of product supplies in the Central Province, eliminating approximately 1,650 tanker trucks daily
Management Institute in the Gulf region. Saudi Aramco began the process of taking person- from the highways, reducing trucking costs and road degradation, improving traffic safety and
nel off one successfully completed project and moving them right on to the next project in a easing traffic congestion around the company’s bulk plants.
Hawiyah Gas Plant, shown here under

construction in 2001, was designed
to process 1.4 billion standard cubic
feet of non-associated gas per day for
the Master Gas System. Saudi Aramco
entered the new century with an
increased emphasis on production
of natural gas to fuel the Kingdom’s
economic diversification plans.
Value Engineering Saudi Aramco in the 1990s explored numerous ways to increase its competi-
tive edge. One example was the company’s adoption of value engineering, a process aimed at
reducing costs while improving quality. A value engineering team was assigned in 1992, under
the leadership of then acting General Manager of Southern Area Projects and later Executive
Director of Industrial Services Abdulaziz Omer Al-Ajaji, to evaluate all projects and eliminate what
is often referred to as “gold plating”: the addition of features that come in the “nice to have”
category but are ultimately not essential to the success of the project.
Value engineering naturally creates internal friction between operating organizations
that want the best facilities possible and project management teams responsible for bringing
in projects on time and within budget. In the face of this natural tension, the value engineering
team learned to listen to both sides, always with a keen eye on its ultimate mission: reducing
costs while maintaining—or even improving—the quality and integrity of projects.
The timing of the team’s creation could not have been better. The first project it reviewed
was the giant Hawiyah Gas Plant. The plant was part of a push to develop additional non-
associated gas reserves to supply local industry with fuel and feedstocks. The team scrutinized
every expenditure and trimmed $100 million off the $1.45 billion cost of the project. The plant
opened in 2001, four months ahead of schedule.
The company’s self-evaluation of its project planning and execution process that began in
the late 1990s served Saudi Aramco well as the start of the 21st century brought multiple projects
that placed even greater demands on company management. Saudi Aramco’s ability to execute
such precedent-setting projects and meet other challenges would depend largely upon tapping
the full potential of its Saudi and expatriate workforce.
The Shaybah project was a proving

ground for Saudi Aramco’s work-
force in the late 1990s, as many of
the project managers and other
key personnel moved on to even
larger and more complex oil and gas
projects in the new millennium.
130 energy to the world : Volume two Achieving the vision 131
chapter five
Achieving the Vision
The central crude oil processing

facility at Khurais.
In early 2005, then-Crown Prince ‘Abd Allah,

Minister Al-Naimi and other Saudi senior
government officials began discreetly con-
tacting the Kingdom’s major trading partners
and allies to alert them about an important
development.
After reassessing the Kingdom’s oil and gas strategies, the Saudis had news that was likely to
make headlines and move oil markets when it was announced in May: Saudi Arabia was budget-
ing tens of billions of dollars over five years on one of the largest oil industry capital-spending
programs anywhere in the world.
More than half the total was slated for the construction of a half-dozen sprawling oil produc-
tion facilities—any one of which deserved a place in oil industry record books. Collectively, the
new facilities were designed to boost the company’s maximum sustainable production capacity
of crude oil by 2 million bpd to about 12 million bpd. That increase, roughly equivalent to the
total daily production of Venezuela, would maintain Saudi Aramco’s spare capacity of at least 1.5
million to 2 million bpd to help meet unexpected demand. In addition, plans were prepared for
expanding maximum sustainable production capacity to 15 million bpd in the following decade
if market conditions warranted such an increase.
Some of the funds were earmarked for boosting Saudi Aramco’s refining capacity and
producing significantly more natural gas and related products. The natural gas would be used
to fuel Saudi Arabia’s industrial growth, especially its petrochemical industry. Spurring the next
phase of Saudi industrialization, the plastics and petrochemicals produced by these new industries
would help the nation diversify its economic base and provide greater employment opportunities
for its young and rapidly growing population.
In the summer of 2008, amid the worldwide escalation of prices for construction materials,
Saudi Aramco reaffirmed its commitment to push ahead with its expansion plans. At an industry
Engineer Jamal Al-Marhoun, far gathering in Bahrain, Khalid Al-Falih told the audience, “As we speak, the company has an active
left, and Saudi welders, left to right,
project slate totaling some 65 billion dollars, while our five-year business plan, which begins next
Abbas Al-Darwish, Mohammad
Al-Noor, Mohammad Al-Khabbaz, year, encompasses capital spending approaching 59 billion dollars.” The company held fast to
Hasan Al-Hasawi and Ali Al-Abbad
its strategy of adding production capacity based on its long-term outlook for global oil demand
pose in front of two storage tanks
they helped construct at the Hawiyah and its experience in building for the future, even in down times, in order to cover shortfalls and
NGL Recovery Plant in 2007. help stabilize global energy markets.
It had been more than a generation since Saudi Arabia had seen anything approaching the
scope of the combined projects announced in 2005. In the mid-1970s, the oil company had built
the country’s Master Gas System to capture and process natural gas for industrial use. While it was
the largest such project of its era, its price tag, adjusted for inflation, came to roughly $35 billion.
Ziyad Al-Qasim, studying for a Industry consultancy Cambridge Energy Research Associates (CERA) estimates that based
degree in chemical engineering,
works out a problem in a classroom on expected worldwide investments in oil exploration and production technologies, global oil
in Seoul University in the Republic production will not peak and then decline sharply. Instead, it will reach an “undulating plateau,”
of Korea in 2006. Saudi Aramco’s
growing presence in Asian markets
where global oil production will level off and slowly start declining over the course of several
is mirrored by a greater number decades, beginning around the year 2030. This decline will be cushioned by significant amounts
of Saudi employees studying at
universities in the region and
of production from unconventional oil sources such as heavy oil sands, which will become com-
going on orientation courses. mercially viable as processing technologies improve and world oil prices rise.
Claims that the world faces an imminent shortage of oil are alarmist, CERA believes. “This
is the fifth time that the world is said to be running out of oil,” said CERA Chairman and Pulitzer
Prize–winning author Daniel Yergin. “Each time—whether it was the ‘gasoline famine’ at the
end of WW I or the ‘permanent shortage’ of the 1970s—technology and the opening of new
frontier areas have banished the specter of decline. There’s no reason to think that technology
is finished this time.”
The Asian Boom What was driving the Saudi investments? The basic economics of supply and
demand. Depressed oil prices worldwide in the latter part of the 1990s, combined with the Asian
financial crisis, discouraged global investment in the energy industry. Investors overlooked the
resilience of the developing economies of Asia and elsewhere, and their thirst for oil. Led by China
and India, economic development in areas of Asia came roaring back in the early years of the
new millennium. Suddenly, oil industry experts realized that demand for crude oil was bumping
up dangerously close to existing supply—and that the call for crude oil was going to increase.
Fueled by double-digit economic growth rates, China’s oil imports jumped 17 percent in 2004,
compared to gains of 10 percent in 2003 and 8.5 percent in 2002.
According to the Paris-based International Energy Agency (IEA), global demand for oil was
projected to increase from roughly 88 million bpd in 2010 to 92 million bpd by 2015, with 90
percent of the increase in demand coming from developing countries. By 2030, the IEA estimated
worldwide demand for oil would reach 105 million bpd, even after accounting for anticipated
alternative-fuel use and conservation efforts. Those projected increases loom especially large
in light of one inescapable fact: Annual oil production over this period is expected to decline
in several oil-producing regions, including the North Sea and Alaska’s North Slope, as their oil
reserves are gradually depleted.
Drawing upon its continued success at finding additional sources of oil, and reassessing
what can be produced from existing fields to replace the approximately 3 billion barrels of oil
produced each year, Saudi Aramco was—and still is—confident the country is nowhere near PEOPLE POWER Saudi Aramco entered the new millennium assessing both its ability to execute Aviation apprentices do their
coursework in the Dhahran Industrial
reaching a “peak” in oil production, as some industry experts have postulated. Current reserves major projects and its ability to empower and motivate employees. The company strove to improve
Center in 2007. Participants in
are sufficient to meet demand for decades to come, company executives note, and advances its track record when it came to completing facilities on time and within budget. Equally important the Apprenticeship Program for
Non-Employees go through 24 to
in technology will likely enhance both oil exploration and oil production capabilities. was improvement in its performance on the “soft side” of the business to continue to attract the
27 months of training and study
Saudi Aramco’s confidence is partially based on the fact that its total proven recoverable best Saudi students and professionals, and remain a top choice among expatriate professionals. English, science, computer science
reserves—roughly 260 billion barrels of crude oil—is a conservative estimate. A vast area of “Building for the future isn’t simply a matter of laying pipeline, erecting distillation columns or and mathematics, in addition to job
skills, before they begin working.
promising territory in the Kingdom has not been explored fully or with the latest technology. building gas plants,” Jum‘ah said. “It also means developing minds—and mindsets—ready to
In addition, even small increases in oil production technology can yield big results, and the meet the scientific, technical and intellectual challenges for an ever more complex world.”
company’s goal to raise recovery rates to 70 percent for most of its fields could translate into At a management retreat for company leaders in 1998, Jum‘ah tapped into The Arabian
billions of barrels of additional reserves. Even assuming that Saudi Aramco significantly increases Nights fables about the genie to fashion a metaphor for transforming Saudi Aramco’s corporate
its production above the current rate of roughly 3 billion barrels a year, it clearly has reserves culture. It was time for the company to “let the genie out of the bottle,” Jum‘ah declared. “I
to spare. wanted the brainpower of this company to be released,” he recalled.
A Burst of Energy Haitham Ruwaili, coordinator of the Radiology Group at Saudi Aramco Medical Services
Organization in 2001, was one of the employees who benefited from the emphasis on self-
Until 1946, the predecessors of Saudi Aramco, first known as Casoc and then Aramco, oper- development. Not long after he joined Saudi Aramco in 1995, Ruwaili was selected for a
ated under the concessionaire’s corporate identity and thus lacked a distinctive individual logo. scholarship in the United States to obtain additional technical certification in radiation therapy,
All that changed with the announcement in the June 2, 1946, issue of the company news- but instead opted to pursue a university degree in Riyadh during his off-duty hours. “We
paper the Arabian Sun and Flare of a contest to design the first Aramco logo. By the end of the [Ruwaili and his wife of four months at the time] realized it would be difficult; however, we
month, at least 110 responses had been received. Harry Flackmeier’s double-A design, below also realized that Saudi Aramco would give us full support.” He used vacation days and leaves
left, served as the company’s official trademark for the next 40 years. without pay, and his managers allowed flexibility in his work hours. As a result, two years later
In November 1988, with the creation of Saudi Aramco, a new logo was needed. Once he obtained his degree.
again, the call went out within the company, and in June 1989, the board of directors Keeping the focus on the potential of each employee to use insights and experience to
endorsed the design, below right, created by company graphic artist ‘Abd Al-‘Aziz Al-Ridhwan. benefit the company, Jum‘ah declared 2002 the “Year of Innovation.” Employees were encouraged
to submit ideas for improving company performance via the company’s proprietary Web-based
Idea Management System. By the end of the year, nearly 3,500 suggestions had been received.
Proposals ranged from ways to improve basic work processes or pieces of equipment to patentable
ideas. Added together, those suggestions saved the company hundreds of millions of dollars
within a few years and created new sources of revenue. Sami A. Abdel Mohsin and his team
from the Central Ghawar Well Services Division, for example, found that pumping units could
be built from recycled parts at a fraction of the cost of a new unit. Abdel Mohsin submitted this
idea, and its implementation enabled his unit to cut costs significantly.
Suggestions continued to come in, even after 2002 came to a close. In 2003, the program’s
As the new millennium approached, the company revamped its corporate identity. At first full year, 3,890 employees participated. In 2006, that figure jumped to 6,200. By year-end
the official unveiling of the new logo on April 24, 2000, CEO Abdallah Jum‘ah told employees 2009, nearly 80,000 ideas had been submitted through the system.
gathered in the EXPEC plaza in Dhahran, “This energy burst represents not only our company’s Hawiyah Gas Plant came online in
commitment to meet the energy needs of the world, but also the human energy, mobilized RETHINKING PERFORMANCE STANDARDS To ensure the success of future construction projects, mid-2001, under budget and four
months ahead of schedule, testament
through teamwork, that has propelled Saudi Aramco into the new century.” Saudi Aramco’s senior management understood that it had to analyze its own performance as to the push for improved performance
well as long-embedded company practices. They decided Saudi Aramco needed to be measured brought about by the company’s
experience with the Shaybah and
against its global best-in-class competitors if it was truly going to be transformed into a high- Ras Tanura Refinery projects in the
performance organization. previous decade.
Jum‘ah declared 2001 “the Year of Self-Development” for Saudi Aramco, and the company
instituted new programs, increased its support for employee participation in professional societies,
hosted exhibitions and launched a special website to help employees take control of their own
intellectual growth and career paths. The initiative emphasized the potential for employees to
use personal computers to take courses tailored to their specific fields.
Self-development became an integral part of company culture. Nine years later, during
2010, more than 51,000 employees registered for e-Learning courses and completed an average
of roughly 5.5 courses during the year, selecting from more than 3,645 offerings. Meanwhile,
between 2005 and 2010, company oil and gas operators registered for more than 11,500 Web-
based Operator Training Simulation courses. Employee Abdulrahman M. Abdulqadir said he felt
the system demonstrates that Saudi Aramco is “looking for ways to lead, not just survive.” Senior
Vice President of Finance Abdullatif A. Al-Othman noted, “We understand that sustained business
success comes through providing our employees with opportunities to hone their skills and apply
their talents, and helping them realize their potential as professionals, and as people.”
The results were sobering. In 2000, Independent Project Analysis (IPA), a private U.S. con- Research and Development Center
sulting firm, conducted a benchmark study of 30 industry projects. It found that Saudi Aramco’s
projects were taking 60 percent longer than the average industry project and costing almost 30 Members of the Research and
Development (R&D) Center’s
percent more. biotechnology group, left to right,
Rather than searching for excuses, Saudi Aramco redoubled its efforts to improve performance. Vedamuth J. Vedakumar, Hanaa H.
Habboubi and Mousa S. Enezi
The Hawiyah Gas Plant, completed in 2001, was the first $1 billion-plus project completed since the investigate the possibility of
IPA benchmarking. It provided the first solid evidence that Saudi Aramco was applying the lessons employing bacteria to remove sulfur
from crude oil before it is refined.
of Shaybah and Ras Tanura, as well as value engineering and related concepts. By mid-decade,
major projects were being completed on schedule and under budget 80 to 90 percent of the time.
NATURAL GAS MOVES TO CENTER STAGE The stakes could hardly have been higher. Representing
the first expansion of the MGS since the 1970s, the Hawiyah Gas Plant was a critical component
of the Kingdom’s industrial infrastructure, which was being taxed by the greater than expected
local demand for natural gas fuel and feedstock. The complex, the first plant built exclusively to
process non-associated gas, provided facilities to process 1.6 billion scfd of gas from the deep,
Like its sister plant at Hawiyah, the

Haradh Gas Plant’s project team was
nearly all Saudi. The Haradh facility,
with a processing capacity of 1.8
billion standard cubic feet per day
of non-associated gas, started up
in June 2003. Both gas plants were
named “Project of the Year” by the A pair of R&D personnel discuss
Project Management Institute. their work with a Fourier
transform mass spectrometer,
used to measure extremely low
levels of contaminants, such as
sulfur, in crude oil and refined
products. Left to right are Saeed
H. Al-Shahrani, lab technician, and
Hendrik Muller, senior lab scientist.
Scientists who had been engaged in research and development work for years at widespread
Saudi Aramco facilities got their own home beginning in November 2000: the state-of-the-art
Research and Development (R&D) Center in Dhahran. The center takes a portfolio approach to
devising research programs, targeting near-, medium- and long-term market needs. The first
priority is the desulfurization of crude oil. In the medium-term, the company is investigating
clean fuels, and the third research focus is the management of carbon release.
The R&D Center has entered or is considering entering into collaborations with leading
universities, commercial technology providers and other oil companies, refiners, petrochemical
companies and the automobile industry. Company scientists at the center have been respon-
sible for nearly one-third of the company’s patents. In 2008, researchers began performing
representative pilot plant testing in which refining processes are reproduced on a small scale.
Currently, eight pilot plants are in operation, with future plans calling for a total of 25 plants
to be grouped in one facility.
high-pressure Khuff and Jawf gas reservoirs—the latter a sandstone formation found in 1994 plant was still under construction, Saudi Aramco formed its first Gas Operations business line
lying even deeper than the limestone Khuff formation—at the southern end of the Ghawar to consolidate all gas-related activities. M. Yusof Rafie, who joined the company in 1970 after
field. The gas produced by the plant freed up for export crude oil that had been used to fuel graduating from the University of Cairo with a bachelor’s degree in petroleum engineering, was
domestic industry. appointed the first senior vice president of Gas Operations in June 2000. Rafie, who retired as
The Hawiyah Gas Plant was the model of a modern construction project. The Project a senior vice president in December 2008, became responsible for all gas plants, as well as the
Management Institute (PMI) awarded the plant its prestigious Project of the Year Award in planning, engineering, maintenance and future development of the company’s gas facilities.
2002. The equally large, more energy-efficient and environmentally friendly Haradh Gas Plant,
which reduced the amount of energy lost in the plant’s steam cycle from 65 to 20 percent, was THE NATURAL GAS INITIATIVE In 2000, Rafie also was tapped to be a member of the Saudi
Passengers board one of the com-
pany’s five Boeing 737 jetliners at completed two years later, also at the southern end of the Ghawar field, and won PMI’s Project government’s negotiating team for its Natural Gas Initiative (NGI). Khalid Al-Falih, who had been
the Haradh airstrip while a company of the Year Award in 2003. serving as president and CEO of Petron, the company’s refining and marketing equity venture
helicopter lifts off in the background
in 2007. Saudi Aramco flies one of
The construction of the Hawiyah and Haradh gas plants, and later upgrades, increased in the Philippines, was assigned to lead the negotiating team in 2001. At the same time, he was
the largest corporate air fleets in the the total capacity of the MGS to 9.4 billion scfd. The giant projects underscored the increasing named vice president of Gas Ventures Development Coordination. The NGI was the outgrowth
world, with roughly 200 pilots and
importance the Kingdom and the company placed on developing the country’s gas resources, of an effort on the Kingdom’s part to attract international oil companies to prospect for and
copilots at the controls of a variety
of fixed- and rotor-wing aircraft. especially the gas produced independently of crude oil. Indeed, in June 2000, while the Hawiyah develop gas reserves in regions that were not being actively explored by Saudi Aramco. In the
late 1990s, Al-Falih had helped draft the Kingdom’s first gas strategy and development options
to grow supplies to meet rising demand. The Hawiyah and Haradh gas plants were two of the
more tangible results.
By 2000, the government, under the leadership of King ‘Abd Allah, then Crown Prince, was
focused on negotiating with international companies to help develop the Kingdom’s gas resources.
The Saudi team discussed several complex ventures with three consortia of international oil and
gas companies. The Saudi team and the international oil companies, however, could not agree
on the ventures. “Alignment was proven to be … next to impossible to achieve, between their
expectations and our expectations,” said Al-Falih. Two key roadblocks were disagreement over
the extent of gas reserves open to development and the rates of return on invested capital. In
June 2003, the Crown Prince directed the team to put the exploration portion of the ventures
out for competitive bidding.
The Natural Gas Initiative benefited from a timely change in Saudi Aramco’s corporate
structure. In 2002, Jum‘ah convened a retreat for senior management at Shaybah to set long-
term goals for the company, encapsulated in a set of strategic imperatives. One of the results
of the retreat was the realization that the company needed to create a new organization to
launch business-development initiatives, especially those involving international joint ventures
or international investment in the Kingdom. Too often in the past, executives agreed, ideas or
proposals for new businesses had failed to take root for lack of a dedicated corporate structure to
nurture them. The gas joint ventures were put under the aegis of the New Business Development
organization in 2003, and Al-Falih was named the vice president of that organization.
The first international gas exploration joint venture, the South Rub‘ al-Khali Company Ltd.,
or SRAK, was formed with Royal Dutch–Shell and France’s Total in October 2003. Three more
ventures followed the next year, with Saudi Aramco holding a 20 percent equity stake in each:
Luksar Energy Limited, with Russia’s Lukoil; Sino Saudi Gas Limited, with China’s Sinopec; and
EniRepSa Gas Limited, with Italy’s ENI and Spain’s Repsol YPF. In total, the four ventures covered
more than 330,000 square kilometers of the Rub‘ al-Khali.
In early February 2008, Total exercised its right to withdraw under the terms of the agree-
ment, transferring its stake in SRAK to project partners Royal Dutch-Shell and Saudi Aramco.
The exploratory drilling by the four joint ventures has resulted in two announced discoveries by
Luksar and an excellent gas rate produced in one of SRAK’s wells. As of the end of 2010, all four
ventures were engaged in drilling exploration or appraisal wells.
Working in these remote locations, where the summer heat is extreme and infrastructure is
practically nonexistent, could make the best geologists yearn for a desk job. Not SRAK CEO Patrick
Allman-Ward and his crew, however. “Most geologists spend their lives remapping prospects
that other people have already mapped,” he said. “In this project, we are putting new prospects
on the map that have never been seen before. That, of course, is very exciting.”
QATIF : BLEN DING SUCCESS Saad Turaiki, vice president of Southern Area Oil Operations, The first big crude oil increment of
the new millennium was the Qatif
embodies the characteristics of innovation and self-motivation that the company has been project, which added 800,000 bpd of
promoting among employees. Long before innovation became an official part of the Saudi production capacity in the summer
of 2004. The project also included
Aramco management vocabulary, Turaiki championed ideas that at first left many co-workers expansion of Berri Gas Plant to handle
scratching their heads. In short order, however, they were applauding the implementation of the additional volumes of associated
gas produced with the crude oil.
his concepts.
Turaiki joined Aramco in 1975 after graduating from the University of Petroleum and Minerals,
and worked in the mid-1990s on the Qatif field development. Production was declining as OPEC
tightened supply in an effort to curb falling prices, and managers were trying to cut operating
costs any way they could.
One day, Turaiki was thinking about processing costs and how Saudi Aramco needed dif-
ferent facilities to process each grade of oil it produced. “I said, ‘Why do we have to have three
increments at Qatif? It’s in one area. Can’t you blend the crude and produce it as one increment?’”
The Advanced Fire Training Center He wrote a letter to his superiors asking that the company investigate blending the crude oil
features realistic training environ-
ments to simulate firefighting
grades, a concept that did not receive much initial support from his peers. “Everybody was sort
scenarios such as tank storage, of saying, you know, ‘What is this crazy idea?’” he said. Company engineers nonetheless took
petrochemical processing, marine,
commercial and residential sites.
the idea to research and development. “To their surprise, they came to me and said, ‘You know,
The center opened in 2005. Saad, it’s great. It’s great Arabian Light crude,’” Turaiki recalled.
CAPACITY CONCERNS Saudi Aramco significantly increased production in 2003 to help compensate
for the Iraqi production taken off the market following the U.S. invasion of Iraq in the spring of
that year. The company’s average production for that year was 8.1 million bpd, up 1.3 million bpd
from 2002. When production from the Qatif plant came online in 2004, average daily production
increased to 8.6 million bpd, helping to meet rapidly increasing demand from China in particular.
The production hike narrowed Saudi Aramco’s spare production capacity to less than its
comfort level of 1.5 million to 2 million bpd (out of a total of about 10 million bpd) —and all
signs indicated that world demand was likely to continue increasing at a brisk pace. At the same
time, the level of hostilities in Iraq, including the sabotaging of oil facilities and pipelines, made
it increasingly clear that world markets could not expect significant amounts of crude oil from
that country anytime soon. Saudi Aramco and government officials realized by the latter part of
Given the associated costs, senior operations management had not been interested in 2004 that the Qatif complex, while setting important milestones in terms of size and complexity,
producing individual grades of Qatif crude oil if they could be delivered in increments of only was a harbinger of even bigger, costlier and more complex construction projects to come.
150,000 to 200,000 bpd for each grade. Bringing the field online as a single, 500,000-bpd incre- The company quickly began firming up plans for the unprecedented capital spending
ment of blended crude oil, processed in a single facility, was a far more attractive proposition. program announced in 2005. Concerns about reserve capacity were underscored within a few
With prices clearly recovering by 2000 (when Arabian Light hit a year-high of $31.93 a barrel on months of the announcement when hurricanes Katrina and Rita slammed into the U.S. Gulf coast,
September 22), the project, which included doubling oil production capacity from the offshore disrupting production and refining in several locations and sending crude oil and gasoline prices
Abu Sa‘fah field to 300,000 bpd, got the green light. Development of the increment began in soaring. The twin disasters sent a clear message to world energy markets: The sooner additional
2001 and was completed in July 2004, three months ahead of schedule. production could be brought online, the better.
“POINT OF TRANSFORMATION” A host of new technical advances the company had recently rolled Using MRC wells guided by geosteering reduced by nearly 90 percent the number of wells
out or was in the process of employing in the field gave Saudi Aramco officials confidence that the needed to produce 300,000 bpd, compared with traditional vertical drilling used earlier on the
company was more than ready for the massive projects in the works. At the southern tip of the Ghawar field. Haradh-3 required only 32 MRC wells versus the 280 that would have been required
Ghawar field, 280 kilometers from Dhahran, the Haradh-3 crude oil increment was completed in using vertical wells.
January 2006, five months ahead of an already tight 26-month design and construction schedule. Today, Saudi Aramco’s upstream technological development is spearheaded by scientists
Equally remarkable, the project came in under budget. The Haradh-3 GOSP and associated at EXPEC’s Advanced Research Center (EXPEC-ARC) in Dhahran. Teams of researchers explore
facilities added 300,000 bpd in Arabian Light crude oil production and also produced 140 million new avenues in the fields of geophysics, geology, reservoir engineering (including enhanced oil
scfd of associated gas. recovery technologies), computational modeling of reservoirs and drilling. Advising EXPEC-ARC
is an advisory council—an international body of high-profile scientists, academics and industry
experts that reviews and guides the technology strategy of the ARC. The council includes mem-
bers from King Fahd University of Petroleum and Minerals (KFUPM), Massachusetts Institute of
Technology (MIT), the Center for Remote Sensing at Boston University, Texas A&M University
and the University of Texas.
Muhammad M. Saggaf, chief petroleum engineer, is eminently qualified to lead company
scientists on their quests. Saggaf joined the company in 1989 after completing a degree in
mathematics at KFUPM. That same year, he earned his master’s degree in geophysics from MIT.
After stints in Geophysical Research & Development and Reservoir Characterization at Saudi
Aramco, he returned to Cambridge in 1998 and completed his doctorate at MIT in geophysics in
less than two years. Saggaf is also a recipient of the prestigious J. Clarence Karcher Award from A team from the Exploration and
Petroleum Engineering Center’s
the Society of Exploration Geophysicists. Advanced Research Center (EXPEC-
About 250 people work at EXPEC-ARC, and nearly half have doctoral degrees. “[W]e have ARC) discusses extreme reservoir
contact well technology in 2007. Team
people working here from all over the world, of many different nationalities,” Saggaf said. “We members, left to right, are Hiba A.
believe in the value of working with a diversity of cultures to include the breadth of experience and Dialdin; Nabeel S. Habib; Mohammad
N. Asker; Muhammad M. Saggaf,
knowledge that people from different countries can bring to Saudi Aramco. We also appreciate
then manager of the center; Jin Jiang
the value of the synergies that can be developed from this interaction between people.” Xiao; and Abdullah M. Al-Qahtani.
At the peak of construction, more Located in the midst of a barren, tabletop terrain of gravel and sand, the Haradh project
than 15,000 laborers, craftsmen and
became recognized around the world as a showplace for cutting-edge technologies. Here, the
professionals of various nationalities
were at work on the Qatif project at unprecedented integration of drilling and producing technologies—maximum reservoir contact
different sites, in and out of Kingdom.
(MRC) wells, geosteering for optimal placement of wells, “smart” well completion technology
More than 98 percent of the team
members involved in the project and the revolutionary intelligent field concept (in which surface and subsurface sensors transfer
design, implementation manage- real-time data on temperature, pressure, flow rates and other factors to Dhahran)—represented
ment and inspection were Saudis.
“a point of transformation” for Saudi Aramco, said Amin H. Nasser, then executive director of
Petroleum Engineering and Development. Nasser, named senior vice president of Exploration &
Production in May 2008, said bundling these technologies created “a model to be followed by
the rest of the industry.”
Many of these practices had been used separately or in pairs by the company on individual
wells—the first MRC well in Saudi Arabia was drilled in Shaybah in 2002, and the first “smart”
well was drilled in Shaybah in 2004. But Haradh-3 was the first major addition to production
capacity—at Saudi Aramco or anywhere else in the world—that bundled the technologies and
applied them to a drilling program developing a particular field.
EXPEC-ARC is just one of the many success stories that symbolize the growing capability of As Saudi Aramco expanded its operations and production capacity, it continued to forge
the company since its transformation from a foreign-owned enterprise to one owned, managed new contractual relationships with local and international companies. The strategy was, and still
and largely operated by Saudis. Former Saudi Aramco board of directors member James Kinnear is, vital to the growth of both the company and the local economy. By engaging other companies
once observed that the transformation of Saudi Aramco from a foreign-run company to a Saudi-run to perform important support tasks, Saudi Aramco could concentrate its own resources on
company may be the greatest transfer of technology in the history of mankind, and the EXPEC- its core business tasks. At the same time, the contracts provided welcome opportunities for
ARC advisory council members agree. “I think it’s quite amazing what has been done here [at entrepreneurial Saudis, including those just beginning to do business. In 2009, the company
Saudi Aramco] in the last 20-30 years,” said Stephen Holditch, head of the Petroleum Engineering executed 2,200 contracts and amendments valued at more than $15 billion, 83 percent of which
Department at Texas A&M University and a member of the advisory council. “This was more or less were contracts awarded to local companies and contractors.
an expat-run organization, and now that’s totally changed where it’s all run by Saudi nationals.” On several of the major projects, aggressive schedules and the tight market for materials
led to innovative construction approaches. In response to the shortage of steel fabrication facili-
Award-winning geophysicist Mustafa ties, for example, the Khursaniyah team used concrete as well as standard steel pipe racks. The
Naser Al-Ali, shown here on the
campus of the Delft University of
concrete columns were mostly prefabricated by Snamprogetti, a subsidiary of the Italian energy
Technology in the Netherlands, earned company ENI, and shipped to the construction site, with the final concrete work done on-site.
his doctorate from that institution
One of the most innovative arrangements was with al-Zamil Heavy Industries, which
in 2007. Al-Ali was sponsored in his
studies by Saudi Aramco’s Advanced won the contract to build and deliver 39 pressure vessels in 21 months. Six of the vessels were
Degree Program, one of 227 employees
submarine-sized NGL storage vessels, or tanks, each measuring 67.7 meters long and 6.6 meters
in the program that year.
wide and weighing 1,050 metric tons. In a first for a Saudi Aramco project, the contractor built
and heat-treated the tanks on-site—raising the vessel temperatures to 690 degrees Celsius for
seven days—to speed the construction and installation process.
The Khursaniyah project was especially challenging: A crude oil processing facility and a gas
plant were built simultaneously, side by side. The complex has the capacity to process 500,000
bpd of Arabian Light crude oil from the Khursaniyah, Abu Hadriya and Fadhili fields and 1 billion
scfd of associated gas. The gas plant receives gas from five different sources with varying pressures
and hydrogen sulfide contents. The size and scope of the plant’s gas processing makes it the
“most complex project ever executed” by Saudi Aramco, noted Usama Badghaish, lead project
engineer for the gas plant.
Fawaz Hassan, left, a safety officer

with a contractor company on the
Khursaniyah Gas Plant project, dis-
cusses proper safety harness rigging
with a fellow employee early in 2007.
Hassan was one of thousands of
young Saudis trained to take on
important construction jobs essential
for the success of the long list of
Saudi Aramco projects under way
in the mid- to late 2000s.
EXPANSION CHALLENGES The number and scope of the new projects forced the company to create
construction cities for temporary workers on a scale not seen since construction of the MGS in
the 1970s. To house the Khursaniyah project workforce, for example, a temporary city was built
and supplied with recreation and other support facilities. More than 30,000 men from roughly 30
countries, speaking more than 15 languages, were living there at the peak of construction in 2006.
The high demand for skilled labor on other similar projects in the Gulf region prompted
a renewed focus on training. Saudi Aramco contracted with private companies to train Saudis
in construction, and some contractors provided their own training. Fawaz Hassan from al-Hasa
signed on with Khursaniyah contractor Consolidated Contractors Company in the spring of 2006.
A former communications operator, Hassan received on-the-job training as a safety officer. He
encouraged other Saudis to consider the building trades. “I tell my friends that if they get the
chance to come onto this kind of job, they will have a good future. I tell them they should take
English courses and work on their computer skills, and they’ll get good jobs, too.”
Assisted by tugboats, a supertanker—

all 333 meters and 300,000 tons of
her—eases into a crude oil loading
berth at Ras Tanura Sea Island while
a departing ship crosses her bow in
early 2005. The delicate procedure
of berthing and unberthing these
enormous ships was performed by
company harbor pilots—all Saudis—
thousands of times during the year
in which more than 2.6 billion barrels
of oil were exported to markets
around the world.
The Khurais crude oil increment was the crown jewel of the capital program and demon- Women in Today’s Workforce
strated the massive scale of the company’s effort to maintain stability in world energy markets.
The project tapped into three fields—Khurais, Abu Jifan and Mazalij—and with total production Increased educational opportunities for Saudi women in recent years have created a pool
capacity of 1.2 million bpd, it is the largest single production increment added in company history. of well-educated and well-trained professionals ready to move ahead in their careers.
The project’s enormous scale and complex requirements, combined with an overheated world Economic issues, especially the rising cost of living in Saudi Arabia, have also prompted
market for construction and manufacturing materials and services, created serious challenges for significant changes in the roles of Saudi women in the Kingdom. Today, both partners
Saudi Aramco from a project management perspective. The company responded with innovative in a Saudi household often work outside the home. For many Saudi women, Saudi Aramco
contracting, planning and engineering solutions, and Khurais came onstream on time, below is a popular career option.
budget and with a stellar safety record.
At the same time that work was progressing on the massive Khurais and Khursaniyah Eiman A. Al-Hazza, left, a supervisor
in Saudi Aramco’s Drilling and
projects, Saudi Aramco was also building a 100,000-bpd oil increment in Nuayyim, south of Workover Department, discusses
Riyadh, adding 250,000 bpd of capacity to Shaybah and beginning work on the Manifa project, safety and leadership issues with
Bassam H. Bahrabi, right, during the
a 900,000-bpd oil increment slated for partial start-up in 2013. company’s Exploration & Producing
The capital program also included major components designed to meet growing demand Management Forum in 2008.
for natural gas. Saudi Aramco oversaw a number of simultaneous, interrelated gas and NGL
projects and expansions, primarily the grass-roots project to build the Hawiyah NGL Recovery
Plant. The facility started up in the summer of 2008 with a process capacity of 4 billion scfd of
sales gas from the Hawiyah and Haradh gas plants to yield 310,000 bpd of NGL. The capacity of
A worker is dwarfed by an NGL the nearby Hawiyah Gas Plant to process non-associated gas was increased by 50 percent, from
storage vessel under construction
on the Khursaniyah project site
1.6 billion to 2.4 billion scfd, and the fractionation capacities of the gas and NGL plants in Yanbu‘
north of Dhahran in 2006. A Saudi and of the Ju‘aymah Gas Plant were also increased substantially.
firm was contracted to build six of
the mammoth NGL tanks and 33
The capital program also required increasing the capacity of pipelines and other support
other vessels, and did so on-site. infrastructure. The need for more treated seawater to maintain pressure in the Khurais and
Abeer M. Al-Mutlaq, a career coun-

selor at the King Abdullah University
of Science and Technology (KAUST),
guides Ali I. Al-Naimi, Minister of
Petroleum and Mineral Resources,
through a photo gallery in Jiddah in
early January 2009, part of an event
for the first class of KAUST students.
Hiring and promoting qualified Saudi women is crucial to the company’s ability to tap Dr. Salwa S. Sheikh is a pathologist
for Saudi Aramco Medical Services
the best minds in the Kingdom, male and female. Today, more than 1,100 Saudi women
Organization and the first Arab
are full-time employees, including more than 750 who have college degrees, and more woman to represent the College of
American Pathologists as a team
than 1,300 women are supplemental employees or contractors with the company. Since
leader. Her mother passed away from
1995, a handful of women have risen to the level of manager, and two held that position cancer when Sheikh was seven, caus-
in 2010. More than 40 women hold positions ranging from supervisor to administrator. ing her to make a commitment to turn
that tragedy into something positive,
so she chose pathology as a career.
To make this vision a reality, the company has been pursuing grass-roots projects, expansion
programs and joint and equity ventures in-Kingdom and overseas. In addition to the expansion
of affiliate Motiva’s Port Arthur refinery in the United States to process heavy, sour grades of
oil, the projects include development of export refineries in Yanbu‘ and, in a joint venture with
Total, in Jubail. These refineries will be designed to refine heavy crude oil with high sulfur content
into high-quality, low-sulfur products to meet current and future international environmental
specifications. Another project will construct a world-scale full-conversion refinery along with
associated terminal facilities in the Jazan area.
AN INCREASING INTERNATIONAL PRESENCE For both crude oil and refined products, Asia has
been Saudi Aramco’s fastest growing market and is likely to be a source of steadily increasing
demand for many years. More than half of Saudi Aramco’s exports of crude oil, NGL and refined
products ship to Asia, where the company has a number of refining and marketing joint and equity
ventures. Saudi Aramco increased its investments in the Far East in 2004, buying an equity stake
in Japan’s Showa Shell Sekiyu K.K., a refining and marketing company. In 2005, Saudi Aramco
raised its stake in the publicly held company to 14.96 percent.
“We are currently the number one supplier of crude oil to Japan, to China, to the Republic
of Korea, and to Taiwan,” noted Ahmed A. Al-Subaey, then general manager of the Tokyo branch
of affiliate Saudi Petroleum Ltd., in a 2006 speech. “Frankly, given its geographic proximity to
Saudi Arabia and the escalating demand for energy in Asia and the Pacific, this is our natural
market, and we value it accordingly.”
Teamwork and quick thinking Ghawar fields drove plans to increase capacity at the Qurayyah Seawater Treatment Plant by 4.5 China has fast become one of Saudi Aramco’s most important markets, and a pair of inter-
enabled this team—left to right,
million bpd to nearly 13.5 million bpd. The capacity expansion of the seawater treatment facility related projects are a key component of the company’s future business in the People’s Republic.
Noora Shaikh, Deema Alomair, Aysha
Alomair and Fatima Kaba—to tie for was the largest one-step increase at the facility ever undertaken by the company. The capacity In 2007, company subsidiary Saudi Aramco Sino Co. Ltd. (SASC) signed agreements forming
second place in the women’s division
of various crude oil, gas and NGL pipelines was also increased substantially, and power networks two equity ventures with ExxonMobil, Sinopec Corp. and the Fujian provincial government. “It’s
of the 2007 Grand Quiz. The annual
event, which tests students’ cognitive were expanded. very important for us to be there … in the refining and petrochemical marketing business. It’s a
skills, was hosted by Saudi Aramco’s Saudi Aramco completed major work on the capital program in 2009 and wrapped up breakthrough for us,” said Saudi Aramco Chairman and Minister Al-Naimi.
College Preparatory Program.
remaining work in 2010. Going back to the first crude oil increment at Shaybah in 1998, the The two ventures were the Fujian Refining and Petrochemical Co. Ltd. (FRPC), the first fully
company had completed an unequaled roster of projects, adding more than 3.8 million bpd of integrated refining and petrochemicals venture with foreign participation in China, and Sinopec
oil production capacity and more than 6.3 billion scfd of raw gas processing capacity. SenMei (Fujian) Petroleum Co. Ltd. (SSPC), a marketing venture. The FRPC project, completed in
2009, tripled the refining capacity of an existing refinery from 80,000 bpd to 240,000 bpd and
EXPANDING REFINING CAPACITY One of the prime factors in the rise in fuel prices in the mid-2000s added petrochemical production units and a crude oil terminal. The SSPC venture started opera-
was the worldwide lack of refining capacity. Much of the world has long depended on the more tions in 2007, marketing wholesale and retail motor gasoline, diesel and illuminating kerosene
easily refined light, sweet grades of crude oil, but the forecast is for the world, and Saudi Aramco, to customers in Fujian Province and the eastern part of the adjacent Guangdong Province.
to rely on heavier, sour grades in the future. Many of the world’s refineries are not equipped to Saudi Aramco’s energy strategy also looks to the West. Saudi Aramco has long enjoyed
process these heavier grades. Weighing all these factors together, Saudi Aramco determined in a mutually beneficial relationship with companies in the United States that extends beyond the
2006 that it needed to build additional refining capacity, especially for heavy oil. simple supply-and-demand concerns of the petroleum market. American firms continue to play
“Conventional wisdom had always been to build the refineries where the market is,” to prominent roles for the company in oil field services, project engineering and management,
take advantage of reduced freight costs, explained Abdulaziz F. Al-Khayyal, who was senior and Saudi Aramco relies heavily on the industrial equipment, IT hardware and software, and
vice president of Refining, Marketing & International until moving to head Industrial Relations in advanced technological tools produced in the United States. “[It] is because of the mutually
2007. “Lately, we’ve seen a shift in the market. Certain regions are becoming more demanding, beneficial relationship we enjoy with the United States,” Khalid Al-Falih said, “that Saudi Aramco
preferring one product over another. That means there may be demand for gasoline in America, is committed to remaining one of the top suppliers of petroleum to the U.S. for many decades
diesel in Europe and naphtha in the Far East. If we locate a refinery in Saudi Arabia, we’re able to come.”
to supply one product to the Far East, one product to Europe and one product to the U.S., and Saudi Aramco’s European presence dates back to 1948 with the creation of the Aramco
take advantage of our location between the three markets.” Purchasing Company. The Rome-based company was renamed Aramco Overseas Company (AOC)
The company’s long-term vision sees a mix of refineries integrated with petrochemical in 1950, and two years later, the office moved to The Hague in the Netherlands, where it remained
facilities linked to associated industrial parks, export refineries and upgraded domestic refineries. for 30 years before moving to Leiden, where it was based until moving back to The Hague in 2009.
The benefits of such a strategy are many and include adding value to the country’s hydrocarbon Today, AOC operates branch offices in London, Milan, Tokyo, Hong Kong, Shanghai and New
resources, increasing refining capacity capable of processing heavier grades of crude oil, provid- Delhi, and the services provided range from purchasing and supply chain management to finance,
ing greater volumes of fuels and feedstocks for domestic industries, promoting local economic law and human resources. Saudi Aramco also operates various affiliates that provide international
development and diversification, and creating jobs and investment opportunities. marketing services, with offices in London, New York, Tokyo, Beijing and Singapore.
The Nerve Center
Saudi Aramco’s Operations Coordination Center (OCC), which is managed by the Oil Supply
Planning and Scheduling (OSPAS) Department, is the central control room for the Kingdom’s
far-flung oil and gas operations. Entrance to the cavernous space in Dhahran’s core office
complex is tightly controlled, and with good reason. Here, the biggest video display wall in
the hydrocarbon industry—forming an arc 67 meters long by 3 meters high—provides
real-time monitoring of virtually all of the company’s operations: terminal scheduling; electric
power generation and distribution; and the production and distribution of oil, gas and NGL
and refined products.
Most of the data used to generate the displays is refreshed every 15 seconds. This
enables operators to track the flow of virtually every drop of hydrocarbons produced and
shipped by Saudi Aramco, from wellheads to processing facilities, through more than 17,000
kilometers of pipeline, and finally to loading terminals on both the Gulf and the Red Sea.
Operators work shifts around the clock to constantly track performance of key system
components and have the ability from their desks in the OCC to shut off a remote pipeline
valve, for instance, if sensors embedded in the distribution system detect a malfunction.
The company uses the system to respond to international events as well. In the wake
of hurricanes Katrina and Rita in 2005, OSPAS operators redirected tankers headed for
The “Big Board” in the Operations
damaged U.S. Gulf coast refineries, built up inventory of other products and juggled delivery
Coordination Center (OCC) schedules to major international clients. The result was that the company met clients’
provides a real-time snapshot of
Saudi Aramco’s operations, from
needs on a global basis and did not have to cut back production, despite the damage to
wellheads to company terminals. U.S. oil facilities.
Keeping pace with the increase in international business, Vela, the company’s shipping Khalid Al-Abdulwahed, Abdullah
Al-Dossari and Bader Al-Mousa, left
affiliate, moved its headquarters to Dubai in 2005. The same year, two double-hull product
to right, share a moment on the Piazza
tankers, the Altarf and Zauruk, were added to the Vela fleet, and contracts were signed for the Duomo in Milan, Italy, where in 2007
they were working on a company
construction of six double-hull VLCCs in the Republic of Korea, part of the long-term program to
project with an Italian engineering
replace existing single-hull carriers in advance of international maritime agreement requirements. company. With affiliate offices and
Five of these tankers entered service in 2008 and the sixth in early 2009. Another two were activities in North America, Europe
and Asia, company employees work
added in 2010. in a wide variety of cultures.
Vela is consistently recognized for its safety and environmental achievements. In July
2007, Vela’s engineers pioneered a new ballast exchange system for crude carriers to reduce
the transmittal of invasive organisms. This new system, which was developed in response to
2004 regulations by the International Maritime Organization, continuously exchanges seawater
for ballast to ensure organisms in the water are not transported out of their habitat and into
foreign waters.
In 2010, the Vela fleet of 17 VLCCs, one smaller Aframax-class vessel and four product
carriers completed more than 1,000 voyages, transporting nearly 2 million bpd of crude oil to
customers primarily in the United States and Europe. One of the new tankers, the Sirius Star,
was seized late in 2008 by Somali pirates. The vessel and its crew were released unharmed
early in 2009.
STEINEKE’S LEGACY If he were around today, Max Steineke—the renowned geologist who set A Saudi Aramco affiliate in 2004
bought an equity stake in Showa
the standard for oil exploration in Saudi Arabia—would be proud and amazed. His combination Shell Sekiyu K.K. of Japan, one of
of intelligence, intuition, team building and risk taking contributed to the discovery of some of the largest refiners in the country
and a company that is also active
the largest oil fields in the world. These standards continue to be reflected in the values that drive in researching solar energy and
Saudi Aramco today. Saudi Aramco’s geologists have been using the same skill set, and they are hydrogen fuel. The following year,
Saudi Arabia was the number one
equipped with the latest in exploration technology, particularly 3-D seismic imaging, to advance supplier of crude oil to Japan, China,
the process that Steineke helped start more than seven decades ago. Their discoveries, and the the Republic of Korea and Taiwan,
and a major supplier to India.
company’s ability to find and produce oil from older fields, have played a critical part in Saudi
Aramco’s ability to replace the oil and gas it produces. In the case of natural gas, the company
has actually added to its reserves despite sharp increases in production. Between 2000 and 2010,
18 new oil fields and 11 new gas fields were discovered.
Ali Al-Hauwaj, manager of the Exploration Department since 2004, noted that since the
mid-1990s, the emphasis in exploration has shifted from finding additional oil and gas fields in
central Arabia to a concentrated focus on finding non-associated gas in the Eastern Province.
Based on seismic interpretation and years of working with existing fields, Saudi Aramco decided
to look for gas near existing oil fields. That strategy has paid off, as witnessed by the discovery
of the mammoth reservoir of non-associated gas in the offshore Karan oil field in 2006, making
it Saudi Aramco’s largest offshore gas field.
Al-Hauwaj had his “Max Steineke moment” the previous year. His team had been exploring
around the Midrikah area south of Haradh. The fact that wells had hit gas on the southern end
of the Haradh structure to the north gave Al-Hauwaj confidence that gas could be found near
Khalid G. Al-Buainain, senior vice
president of Refining, Marketing &
Midrikah. Even some of his closest associates doubted him, however. Abdulkader Afifi, manager
International, center, tours a refinery of Exploration Technical Services at the time, recalled, “I had given up on some areas where Ali’s
in May 2008 in Fujian Province,
China, site of a joint venture refining
people subsequently discovered major accumulations of gas. … I thought this Midrikah area
and petrochemicals project. would not be a gas discovery.” Al-Hauwaj had to all but plead for approval to drill a wildcat well. A seismic interpreter
pointed out that the seismic interpretation on the area did not indicate a geologic trap in the
strata likely to contain gas. But more than a quarter-century of experience with the rocks in the
region, and seeing similar formations that contained gas, convinced Al-Hauwaj that it was worth
the risk. “I said, ‘Give me the location and I will prove the trap. We’ll take the risk and drill it.’”
His bet paid off. By February 2006, the well was producing 30 million scfd of gas and 900
bpd of condensate (liquid hydrocarbons produced with natural gas).
CARING FOR THE ENVIRONMENT From the company’s earliest days, it has had an awareness of its
potential impact on the environment, resulting in a broad array of environmental requirements,
engineering standards, air quality and emission standards, noise control regulations, landfill
standards, water recycling procedures and hazardous material disposal rules.
This awareness also manifested itself in publications such as Biotopes of the Western Arabian
Gulf: Marine Life and Environments of Saudi Arabia in 1977, the result of a five-year company
study, which included a list of the animals and plants inhabiting the Gulf and created a biologi-
cal baseline against which future ecological changes could be measured. Similar studies were The Saudi Aramco logo began
appearing on Sinopec SenMei (Fujian)
undertaken on the ecosystem of Tarut Bay in the mid-1980s in cooperation with the University
Petroleum Co. gas station signage
of Petroleum and Minerals, and the ecology of Manifa and Tanajib bays, which was completed in China in the summer of 2007. A
company subsidiary signed agree-
in 1986. In 1989, Saudi Aramco assisted in the publication of the most complete work on the
ments that year, forming two joint
birds of the western Gulf and its hinterlands ever printed: Birds of the Eastern Province of Saudi ventures, a manufacturing arm and
Arabia, a volume that covered 340 species. a marketing venture in the Fujian
Province of China.
In the early 1990s, the company began devoting billions of dollars to produce more envi-
ronmentally friendly products. The world started to see evidence of these initiatives by the turn of
the new millennium. The company already was a Gulf area industry leader in the effort to remove
lead from gasoline. By 1998, Saudi Aramco had reduced the lead content in its gasoline to half of
the 1991 level, and on January 1, 2001, it stopped producing leaded gasoline altogether—well
ahead of the schedule set by Gulf Cooperation Council member countries.
Saudi Aramco is positioning itself to take a leading role among state-owned oil companies
on green issues, particularly in regard to reducing the “environmental footprint” of the petroleum
industry, among producers and consumers alike. As Abdulaziz Al-Khayyal, senior vice president
of Industrial Relations, put it, “There are opportunities to mitigate this environmental impact all
the way from the wellhead to the wheel.” One such promising opportunity is greater efficiency.
“Even incremental improvements in petroleum’s energy efficiency have enormous environmental
and economic benefits,” Al-Khayyal observed, “while major breakthroughs could revolutionize
our energy future.”
A NATIONAL OIL COMPANY WITH INTERNATIONAL ROOTS While Saudi Aramco began as the
business venture of a publicly traded international oil company (IOC), today it is a fully integrated
national, or state-owned, oil company (NOC). The fact that Saudi Aramco is now state-owned is
not unusual—worldwide, NOCs now manage more than 90 percent of known oil reserves—but
Saudi Aramco has been uniquely successful at retaining the management culture of an IOC while
adopting the long-range views and responsibilities of an NOC.
Though NOCs and IOCs are in the same business, they operate differently. While IOCs
focus purely on profit, NOCs often take on additional roles for the state, such as creating jobs,
supporting the development of the national economy and supplying low-cost fuel, to name just a Abd Allah S. Al-Saif, senior vice
few. Because NOCs are responsible for their countries’ energy resources and cannot simply move president of Exploration & Producing,
standing at center with his hands
on to a different region once the easily accessible oil has been extracted, they typically invest crossed, and other company execu-
more effort into long-term planning than do IOCs. Saudi Aramco, for example, continuously tives in April 2006 visit the crew
of the offshore drilling rig that
develops new reservoir management techniques to preserve the Kingdom’s energy resources discovered Karan, the company’s
for as long as possible. largest offshore gas field.
In May 2007, Vela appointed two new Environmental issues continue to be a primary focus at Saudi Aramco, with programs
members to its board of directors—
focusing on monitoring and mitigating any impact on the quality of the environment in which
Ali A. Attiyah Al-Lafi, back left, and
Huda M. Al-Ghoson, back center, the company operates. A series of upgrades in the first decade of the new century at Shedgum,
a 26-year veteran of Saudi Aramco
Berri and ‘Uthmaniyah gas plants significantly reduced sulfur emissions. New diesel hydrotreaters
and the first woman to serve on the
board of a Saudi Aramco affiliate. at three Yanbu‘ and Riyadh refineries will reduce emissions from burning diesel by 95 percent, as
Also shown are board members all the diesel fuel produced in-Kingdom will be low-sulfur diesel fuel.
Mustafa A. Jalali, back right;
Abdulaziz F. Al-Khayyal, front left; For more than 20 years, Saudi Aramco has been closely monitoring air quality near all of
and Saleh B. K’aki, front right. its facilities to ensure they continue to meet or exceed stringent company air quality standards
as well as government environmental regulations. Ongoing monitoring also tracks water quality
near company facilities.
Sensitive to the issue of climate change, Saudi Aramco, in collaboration with the Ministry
of Petroleum and Mineral Resources, organized a May 2006 international symposium on carbon
management, the first such meeting held in the Middle East. The company has also created a
carbon-management team to focus on coordinating the company’s efforts to minimize carbon
emissions.
Saudi Aramco is also collaborating with international research institutes and technology
developers to develop new environmental technologies. High on their research agenda are
carbon capture and sequestration (capturing heat-trapping carbon dioxide from large sources
such as power plants and refineries, liquefying it and injecting it into underground reservoirs),
cleaner-burning fuels and more environmentally friendly automobile engine designs.
In addition, Aramco Services Company co-sponsors the Weyburn-Midale CO2 Monitoring
and Storage Project managed by the Petroleum Technology Research Centre in Canada. Other co-
sponsors of this initiative include companies such as Chevron and Schlumberger, Japan’s Research
Institute of Innovative Technology for the Earth and the regional electric utility SaskPower.
At the same time, Saudi Aramco’s organizational structure remains influenced by its days In this relationship, the United States and other oil-importing countries rely upon the oil-
as an IOC. Unlike other NOCs, the company operates to implement the government’s energy exporting nations for reliable supplies of petroleum to fuel their economic growth and maintain
policy, but does so with a large degree of independence. As Nansen Saleri, who for many years their quality of life. In turn, oil-exporting countries need the energy markets of consuming countries
oversaw Reservoir Management, explained, “Today, when you look at [Saudi Aramco], it is an to generate revenue to fund their own economic growth. Furthermore, the United States, Europe
international oil company. Even though it’s a national company, in many respects it operates and Asia provide services and technology to countries such as Saudi Arabia. Moreover, many
like a private oil company … its thinking … its management style … the way it addresses its Saudis in key positions in Saudi Aramco and the government received their higher education or
needs. … The amount of empowerment that middle management has far exceeds the amount advanced training in the United States and Europe.
of empowerment that other middle management has anywhere else in the world. And I think
this is a key differentiator as far as the performance of the company. It’s that empowerment.”
ENERGY INTERDEPENDENCE In the first eight years of the new millennium, crude oil prices more
than quadrupled, and on March 3, 2008, oil reached a high of $103.95 a barrel on the New York
Mercantile Exchange, beating by 19 cents the inflation-adjusted record of April 1980. Four months
later, in early July, oil prices briefly touched a new record price of $147 a barrel. The reasons for the
escalation in prices were complex and varied. Saudi Aramco believed, and many energy analysts
agreed, that the reasons were aboveground issues, rather than a lack of hydrocarbons beneath
the surface. Some of these reasons included the growing demand from emerging markets in
China, India and the Middle East, global underinvestment in oil infrastructure, a worldwide
shortage of refining capacity, conflict and tension in key oil-producing areas of Latin America,
Africa, the Middle East and Central Asia, and financial speculation in commodity markets such
as oil and gold. In the build-up to the record price of March 3, other factors also came into play,
as noted by The New York Times: the recent fall in the value of the U.S. dollar and the actions of
investors, including pension and hedge funds, as they sought financial refuge in commodities
such as oil to offset the slowing economy.
Aramcons and local students join

together to plant mangrove seedlings
in 2004 as part of an effort to restore
the natural habitat of Tarut Bay. Saudi
Aramco has sponsored mangrove
research and restoration since the 1980s,
and its volunteer planting campaigns
have become an annual tradition.
One key factor in the discussion of the future of the world’s energy supply is the growing role Khalid A. Al-Falih, center, in light-
colored coveralls, leads a review
of energy sources other than petroleum. Perhaps surprisingly, Saudi Aramco has advocated the
of progress on the Hawiyah NGL
development of alternative energy sources as necessary to help meet future demand for energy. As Recovery Plant project in August
2008. Three months later, in
Jum‘ah remarked in an address at the Harvard University Center for the Environment in January 2007,
November, Al-Falih, a 30-year
“As an oil man, I not only welcome additional contributions from alternative fuels, but I believe these veteran of the company and
contributions will be essential if we are to meet the growing needs of global energy consumers. member of the board of directors
since October 2004, was named
… This growing need for additional energy supplies is why I think work on alternative energy is so CEO and president of Saudi Aramco.
important, and why such efforts should be based on a realistic appraisal of their potential, including
the rate at which their contributions to global supplies can be expanded.”
One promising direction for alternative sources of energy is a natural resource Saudi Arabia
also possesses in abundance: sunshine. In 2009, Saudi Aramco signed an agreement with Showa
The higher energy prices produced calls from some quarters in the United States and other Shell Solar, an affiliate of Showa Shell that was later renamed Solar Frontier K.K., to share infor-
countries for “energy independence,” but Saudi Arabia and Saudi Aramco have long championed mation with the intention of mutual commercial and technical development of electrical power
energy interdependence: cooperation among producers and consumers to encourage energy generation plants in the Kingdom based on Solar Frontier’s technology. In 2010, work began on
diversity, efficiency and conservation. In remarks made at the 15th Annual Arab-U.S. Policymakers small-scale solar power pilot facilities that can generate 1–2 megawatts.
Conference in Washington, D.C., in October 2006, Al-Falih framed the relationship in this manner: The record-high oil prices in 2008 dropped sharply later in the year in the wake of the
“If one defines the pursuit of energy independence as essentially a quest for reliable and affordable financial crisis that gripped much of the world. Most experts agreed, though, that a return to
supplies, then the best way to achieve that is by strengthening relationships in the context of a higher energy prices was likely as the global economy recovered, mainly because most of the
diverse global marketplace.” factors cited in the rise to the record-high prices remained valid.
The Saudi government’s goal is to capture more of the value of the country’s resources, in
this case natural gas, at every stage of the production process, not just as basic petrochemicals.
Achieving this goal will lead to realizing another parallel goal—creating local industries that provide
lucrative and sustainable employment opportunities for Saudi Arabia’s burgeoning population.
Two large petrochemical projects will form the backbone of the latest phase of Saudi
industrialization. The first is Petro Rabigh, a roughly $10 billion joint venture with Japan’s Sumitomo
Chemical Co., Ltd., which transformed Saudi Aramco’s Rabigh Refinery on the Red Sea into an
integrated refining and petrochemical processing plant. The second is a proposed multi-billion-dollar
project with The Dow Chemical Co. to develop a petrochemicals facility in the Jubail industrial
area north of the Ras Tanura Refinery complex and Ju‘aymah Gas Plant. The world-scale chemicals
and plastics production complex includes plans for an associated conversion park for local and
foreign private-sector companies.
Saudi Aramco and Sumitomo broke ground on the Petro Rabigh project in March 2006.
In addition to originating about 30 percent of the financing within Saudi Arabia, 25 percent of
the equity in the project was sold in an initial public offering to Saudi citizens and institutions
in January 2008. The stock offering raised $1.23 billion. It was the largest stock sale in Saudi
history and marked the first time that Saudi Aramco had offered shares in one of its affiliates to
the public.
Petro Rabigh commenced operations in early 2009 and is capable of producing 2.4 million tons
per year of petrochemical solids and liquids, mainly ethylene and propylene. The petrochemicals
will be used to make everything from plastic fibers and films to foam for furniture and automobiles,
sealants, resins and antifreeze. Large volumes of gasoline and other refined products will also be
produced. Saudi Aramco and Sumitomo are exploring a proposed second phase of the venture
to expand both refining and petrochemical production.
The unprecedented expansion of Saudi Aramco oil, gas and petrochemical facilities in the
Kingdom, impressive in its own right, is itself only a part of an even more ambitious and sweeping
modernization plan that is reshaping Saudi society. The hydrocarbon expansion is one aspect of
an estimated $500 billion investment program designed to further diversify the Saudi economy,
provide millions of new jobs for Saudi citizens and greatly expand educational opportunities in
the Kingdom.
An 800-ton regenerator is offloaded The following year, in October 2009, the oil market witnessed another significant development BUILDING A KNOWLEDGE-BASED SOCIETY Even while the petrochemical projects were forging
at the Petro Rabigh project site in
in the price of crude oil: Saudi Aramco announced it would switch from West Texas Intermediate ahead, Saudi Aramco received another task. In July 2006, King ‘Abd Allah, who became King
2007. The regenerator and several
other larger vessels were later lifted (WTI) to the Argus Sour Crude Index as a benchmark price for all grades of crude oil sold to customers in 2005 after King Fahd’s death, asked the company to take the lead in building and developing
into position by an MSG80 heavy-lift
in the United States. High inventories of WTI at its trading hub in Cushing, Oklahoma, in the first the King Abdullah University of Science and Technology (KAUST), a centerpiece of the plan
crane, one of the two largest cranes
in the world. quarter of 2009 dislocated the price of WTI from the global oil market. The change in pricing to the to broaden the Kingdom’s educational offerings. The company was charged to construct the
less-volatile Argus Index, a basket of three grades of crude oil from the Gulf of Mexico, reflected graduate research university from scratch on a 36 million-square-meter site located near the
the growing importance of sour grades of crude oil in the world market. fishing village of Thuwal about 80 kilometers north of Jiddah on the Red Sea. Saudi Aramco
assembled a project team and enlisted the help of an international advisory council to craft the
A HEIGHTENED PROFILE FOR PETROCHEMICALS The MGS was the first major effort of Aramco university based upon the best practices of the world’s top academic and research institutions.
to support the launch of the Kingdom’s national industrialization plans and its petrochemical In an innovative approach, the university was organized around four interdisciplinary research
industries. In recent years, the company’s involvement in the petrochemical industry has taken institutes and also features an adjacent research park to link activities with private-sector research
a new turn. Integrating petrochemical manufacturing centers with Saudi Aramco’s refining and and economic development. The university, with a multi-billion-dollar endowment that places
related activities became the focus of the company’s New Business Development administrative it among the top universities in the world, is open to men and women and attracts top science
area following the signing of the joint-venture gas exploration agreements in 2003 and 2004. and technology students and faculty from around the world as well as from within the Kingdom.
The Kingdom and the company brought in consultants to help focus discussions on pet- KAUST Interim President Nadhmi A. Al-Nasr, speaking at the October 21, 2007, groundbreaking
rochemical development options and to learn from other countries’ successes. “We said, ‘How ceremony presided over by King ‘Abd Allah, emphasized the twin goals of the institution. “KAUST
did Singapore do it? What did Korea do? How did Japan industrialize?’” recalled Al-Naimi. Saudi will collaborate with the best institutions and convene the most talented scientists from around
Arabia’s existing petrochemical company established in 1976—Saudi Arabia Basic Industries the globe to enable discovery that will help all humanity,” he said. “It will also deepen and diversify
Corporation, or SABIC—“goes to a point and stops,” said Al-Naimi. “They sell basic materials, Saudi Arabia’s knowledge-based economy,” added Al-Nasr, who was Saudi Aramco’s vice president
and then the industrialization is done in the Far East or in Europe. It’s not done here.” of Engineering Services prior to being assigned to lead the KAUST development effort.
The Evolution of Social Responsibility
The Kingdom of Saudi Arabia and the company that became Saudi Aramco grew up together.
Even in the early days, the Kingdom’s leadership knew the petroleum industry would—literally
and figuratively—fuel the country’s growth and development. The company also realized its
responsibility to help develop a healthy society and a vibrant economy, both of which were in the
long-term interests of the company and the Kingdom.
From its first days, the company was involved—by internal initiative, business need, social
need or government request—in developing the nation in the broadest sense, far beyond
its commitments as an oil concessionaire. In the beginning, the company had to do literally
everything itself, and not just core activities such as surveying, drilling and building company
facilities, but everything related to supporting itself: health care, power generation, water supply,
laundry and food preparation. As the company grew, its social responsibility initiatives expanded,
ranging from public health and safety programs, publishing, TV programming and transmission,
and industrial development, to school building, land development, and home ownership and
education programs, to name a few.
One of the central areas of focus As time passed, the company was woven into the country’s economic and social services
in the company’s contemporary
fabric: It supported or complemented services provided by the government, and it increasingly
community outreach philosophy
is to develop a stronger culture depended on goods and services provided by the private sector—a private sector the company
of volunteerism in the Kingdom,
helped create by supporting employees who founded new businesses.
especially among younger of the government’s total revenue. This applies to government hospitals, health clinics, water Throughout its history, Saudi Aramco
generations. Until 1980, Aramco was required to pay the government the concession rental and a share has served as a role model and innova-
treatment plants, highways and other infrastructure. And the oil, gas and feedstocks Saudi tor in the Kingdom in a wide variety
of its profits. Social responsibility initiatives and other developmental programs were paid for
Aramco produces fuel water desalination, power plants and numerous domestic industries. of endeavors, from health care and
with the company’s share of profits or compensated for by the government. When the company education to environmental practices
Given this context, the company has reduced or ended programs now run by the govern- and safety standards. Here, Sahar A.
became fully Saudi owned, all of its income became the government’s, and although some
ment and has adopted new programs and expanded existing ones to be more compatible with Al Dughither works as a volunteer in
social responsibility programs were continued or expanded, its social responsibility strategy the company’s hospital in Dhahran.
its revised role. In 2009, the company articulated its citizenship vision: “To be an influential
became more focused on increasing the Kingdom’s revenues from petroleum and on being
leader in creating sustainable social and economic opportunities for the welfare of the Kingdom
a catalyst, role model and supporter of growth and development in all aspects of society in
and in other locations where we do business.” It focused its citizenship efforts on four sectors, or
general, and in the economic sector in particular.
pillars—economy, community, knowledge and environment.
In a very real sense, the scope and scale of the company’s contribution to the economic
Representative of the company’s citizenship vision was the Traffic Safety Signature
and social development of Saudi Arabia increased exponentially. Instead of being directly
Program initiated in 2009, an effort to address one of the Kingdom’s most critical challenges.
responsible for building some government schools, Saudi Aramco now contributes about 80
The program focused on making a lasting difference through building capacity through
percent of the cost of every government school built because it contributes about 80 percent
strategic alliances with a goal of reducing traffic deaths.
King ‘Abd Allah has stressed the need for Saudi Arabia and all developing countries to Fifteen months later in December 2010, at the school’s first graduation ceremony, 292
make greater academic progress in the fields of science and technology: “We are living in an era pioneering graduates were awarded master’s degrees. About one-third of them intended to
of scientific and technological advancement. There is no real power without achieving progress continue at KAUST in pursuit of doctoral degrees, and about half were planning to remain in
in science and technology.” Saudi Arabia to contribute to the development of the Kingdom.
Officials of the nascent university began creating programs and signing international devel- “Life at KAUST also taught us how to extend our family,” said student commencement
opment agreements even while facilities were under construction. KAUST initiated partnerships speaker May Alqurashi. “It was not all about academics. Here, we met friends from all over
with some of the world’s foremost research institutions, with each partnership drawing upon the the world. We found that although we are different in many ways, we are so close and similar.
strengths of the respective institution. For example, KAUST and the Woods Hole Oceanographic Anyone walking around the campus would see friends gathering together and feel the spirit of
Institution in Massachusetts are engaged in research focused on coral reefs, coastal hydrography, everlasting friendship all over the place.”
and fisheries and aquaculture, while a partnership with the Institut Français du Pétrole focuses This same spirit was very much in evidence when Saudi Aramco celebrated its 75TH anniversary
on carbon capture, clean fuels, catalysis, polymers and chemical engineering modeling. in May 2008. The centerpiece of the yearlong festivities was King ‘Abd Allah’s visit to Dhahran
In January 2008, the university awarded its first KAUST Discovery Scholarships to 178 on May 20 in remembrance of historic visits to company facilities in the Eastern Province in 1939
outstanding male and female engineering and technology undergraduate students from around and 1947 by his father, King ‘Abd al-‘Aziz. On both occasions, when the Kingdom’s founder
the world, including more than 80 students from Saudi universities. The students, whose selection visited the fledgling oil camp at Dhahran, among many other activities, he received the expatri-
was based on academic criteria, were part of the first group of graduate students when the ate employees, their wives and their children. In 2008, the company brought 29 of those “1947
campus opened for classes in September 2009. Kids,” some now accompanied by their spouses or grown children, back to Dhahran to meet King
Students head to class on the ‘Abd Allah. Saudi Aramco’s pioneer spirit, exemplified by the many retired Saudi and expatriate
campus of the King Abdullah
employees honored during the anniversary, is a living part of Saudi Aramco today, and a source
University of Science and
Technology. The graduate of inspiration for the new generation of Aramcons.
research university, built by
On his visit to Dhahran to mark the company’s anniversary, King ‘Abd Allah laid the symbolic
Saudi Aramco, opened its
doors in the fall of 2009. cornerstone for the King Abdulaziz Center for World Culture, Saudi Aramco’s flagship community
outreach initiative. The Center, which will feature a public library, a museum, a children’s center
and other facilities, is envisioned to be a catalyst for cultural and social progress and a forum
for knowledge dissemination and innovation. Located near the site of Well No. 7, the Center
will be an iconic architectural landmark and a model for social progress through education and
cross-cultural exchange.
For Al-Naimi, developing Saudi Arabia’s petrochemical industry, founding its newest
university and building a world-class cultural center are closely linked to the Kingdom’s future,
and all are linked to Saudi Aramco’s legacy of reliability and transformative power. “Hydrocarbons
will always be important to Saudi Arabia,” he said. “Currently the Kingdom is exploiting them
as the flywheel for developing industrialization across the country. But in the future we need to King ‘Abd Allah, center, joined by
leaders of other Gulf states, members
use them as the flywheel for converting [Saudi Arabia] into a knowledge-based society. That is
of the royal family, Saudi Aramco
the challenge.” management and a group of Saudi
children, celebrates Saudi Aramco’s 75th
The vision of King ‘Abd al-‘Aziz remains central to Saudi Aramco’s comprehensive strategy,
anniversary in Dhahran in May 2008.
which aims to ensure success both today and for generations to come. The King’s vision, embodied
in the terms of the original concession agreement with Socal, has been realized many times over.
King ‘Abd al-‘Aziz would approve of the enormous expansion of Saudi Aramco throughout
the Kingdom and around the world, and the improvements in processes and technology that
contributed to it, but he would be most pleased to see that many Saudi men and women are
largely responsible for that success.
168 appendix appendix 169
Appendix
Upstream
Downstream
Operations Data
Top of reservoir Geological fault Reservoir porosity

reflected in different
colors
dammam dome reservoir quality
A 3-D reservoir model of the Dammam The 3-D model illustrates the reservoir,
Poor
Dome from 2008 is aligned with the roughly 1,500 meters below ground.
corresponding area from the first map Good
of the Dammam Dome, drawn in 1934.
Excellent
Upstream The origins of hydrocarbons

Land
Sea
Upstream encompasses all the activities from the drill bit to the refinery: the
exploration for, and development, production and processing of, oil and gas.
Water injection, oil stabilization, gas processing and pipelines are included
Tiny forms of sea life such
within the scope of upstream operations.
as plankton die and accumulate
Upstream begins with earth scientists searching for oil and gas by examin- on the ocean floor.
ing rock outcrops on the surface to try to understand the subsurface strata.
They integrate their interpretations with data collected from inside the well: Layers of sediment form as the
accumulation process continues
from drill cuttings (bits of rock that rise to the surface as a well is drilled),
over time.
core samples and wire-line logs (instruments that record electrical values,
radioactivity, temperature and other rock properties). The integrated data
are used to identify prospects—areas likely to contain petroleum.
Once a prospect has been identified, geoscientists acquire and interpret
seismic data to develop integrated geological and geophysical models that
are used to select the best drilling locations. After a discovery is made, drilling
to delineate and develop a field takes place, and reservoir engineers design
production plans. Improvements in technology continue to increase recovery
rates, enabling geoscientists and petroleum engineers to manage reservoirs
Parts of the dead material change
efficiently and for the long term. Saudi Aramco also places significant emphasis to hydrocarbons mixed with other
on operations safety and environmental protection. sedimentary materials.
Layers become more and more

The Origins of Oil and Gas Oil and gas originate almost entirely from the remains of ancient compresssed as further layers
settle on top.
plants and animals as shown in the diagram on the facing page. The solar energy absorbed by
these organisms and stored as carbon molecules in their bodies has been recycled into petroleum
energy in the form of organic compounds composed mostly of hydrogen and carbon. These
hydrocarbon compounds were created when microscopic marine organisms and plant matter
were buried by layers of sediment and, over millions of years, transformed through bacteria, heat
and pressure into oil and gas, which gradually seeped up through layers of rock, collecting in
underground structures called traps.
The fossilized remains of ancient marine

organisms, seen in the core samples New material–depositing sediment
pulled up from wells thousands of forms an impervious layer called
cap rock.
meters deep and collected from rock
outcrops on the surface, yield a wealth Gas
of clues to geologists searching for
Oil
oil and gas. These specimens, as seen
by a scanning electron microscope in Gas, oil and water
EXPEC, are acritarchs, fossil marine
organisms of unknown biological
affinity, and date to the early Silurian Earth movements cause folds
age, about 430 million years ago. in the crust.
Stratigraphy of Eastern Saudi Arabia The rich oil and gas fields of Saudi Arabia, located
mainly in the Eastern Province, are linked to the region’s long history of relative tectonic stability
in its subsurface. The virtually flat platform of the Arabian Shelf, which underlies the middle and
siberia
eastern side of the Arabian Peninsula and its shallow eastern offshore area, enabled an almost
uninterrupted accumulation of sediments, which provided both the source for oil and gas and
the reservoirs in which these hydrocarbons accumulated.
europe
china
turkey iran
generalized cross section
tibet of saudi arabia
north
america indochina The final 10 million years of the late
Jurassic Period witnessed significant
southeast
asia environmental changes, as shallow
seas receded and advanced, leaving
in millions of years behind alternate layers of nonporous
sea level
africa
arabia anhydrite and porous and permeable
limestone. The latter layers formed the
Arab Zone, which contains the world’s
south largest petroleum reserves. Over the
america
course of millions of years, infrequent
–304.8m tectonic events led to the formation of
structural traps, capped by anhydrite,
india which captured the hydrocarbons.
australia
–609.6m
67–140 million years ago

a n ta r c t i c a key
cretaceous period
sand and mud
limestone
anhydrite
–914.4m
shale
Bahrain sandstone
100 Zone
e a r ly j u r a s s i c 1 9 5 m i l l i o n y e a r s a g o key porous limestone
The enormous hydrocarbon reservoirs ancient Landmass –1,219.2m

in what became Saudi Arabia Zubair
Modern Landmass Zone
accumulated in carbonate sedimentary 120
rocks deposited in the late Jurassic subduction zone (triangles point
in the direction of subduction)
Period, around 150 million years ago.
seafloor spread ridge
Upper
130 Ratawi Zone
–1,524m
Lower
135 Ratawi Zone
A Brief Geological Timeline of Saudi Arabia The Earth’s interior, composed of semi-molten Manifa
140 Zone
rock, is in constant motion. The outer rigid layer, the lithosphere, consists of large plates
that slide over the semi-molten layer. These plates pull apart from, slip past, dive under and –1,828.8m
Arab A
collide with each other in a process called plate tectonics, forming mountains, basins and the Member
continents themselves. Arab B
Member
Around 1.1 billion years ago in the Precambrian, the Earth’s landmasses formed one Arab C
Member –2,133.6m
supercontinent, Rodinia, which, some 250 million years later, broke apart. The supercontinent
140–204 million years ago

Arab D
of Gondwana formed around 514 million years ago, in the late Cambrian Period. Gondwana, 150 Member
jurassic period
which included the landmass of Arabia, stretched from the Equator to the South Pole, and it and
Mid-Jubaila
the other continents were flooded by shallow seas. Algae were dominant, and hard-shell marine Zone
–2,438.4m
animals appeared in great numbers.
About 100 million years later, in the early Devonian Period, the Paleozoic oceans began to Hanifa
Zone
close, and eventually the supercontinents of Gondwana and Euramerica collided to form Pangea. Hadriya
Zone
Pangea began to break apart in three main episodes, with the first occurring in the middle –2,743.2m
Fadhili
Jurassic Period, about 180 million years ago. This age was dominated by the giant dinosaurs, Zone
the first appearance of birds and extensive inland seas where, 30 million years later, in the late 165
Jurassic Period, enormous layers of organic matter accumulated in what became Saudi Arabia.
In the last 20 million years, the Red Sea opened, rifting Arabia away from Africa.
Petroleum Traps
Niyashin
Zuluf Marjan
Rimthan Safaniya Maharah
As Sayd Lawhah
Dibdibah Hasbah
Jauf Hamur
Ribyan
Namlan Harqus Arabiyah
An anticline trap is an upward fold Suban
Sharar Manifa Karan
in the layers of rock shaped like an Wari‘ah Habari
Gas Kurayn
Juraybi‘at Jana
arch. Petroleum migrates into the Jurayd
Watban Abu Hadriya
highest part of the fold and is pre- Cap rock Duhaynah Rabib
vented from escaping by an overlying El Haba Jaladi
Bakr Khursaniyah Berri
bed of impermeable cap rock. The Reservoir rock and water Abu Sa‘fah
Faridah Dhib Fadhili
great majority of oil reservoirs are Samin
found in anticline traps. Qatif
Oil
Dammam bahrain
Fazran Dhahran a
r
Jaham a
Abqaiq b
ia
n
g
‘Ain Dar ul
f
Shedgum
q ata r
Khurais ‘Uthmaniyah Ghawar
Qirdi
Cap rock Abu Jifan Hawiyah
Riyadh Manjurah
A fault is the result of horizontal layers Harmaliyah
Farhah Awtad
of rock being folded or deformed, Gas Warid
creating a fracture. When the rocks Mazalij Haradh
on the two sides of a fracture move in Oil Sirayyan Jufayn
Dilam Arsan Sahba
opposite directions, a fault is created. Abu Tinat united arab
Sanaman Shidad
A fault trap occurs when formations Reservoir rock Raghib
Dirwazah e m i r at e s
Shiblah Wudayhi Midrikah Niban Lughfah
on either side of a fault prevent and water Duayban
further migration of petroleum. Hilwah Nujayman
Abu Rakiz Jawb Marzouk
Khuzama Halfa
Mulayh
Burmah Yabrin Qamran
Abu Markhah
Nisalah Zimlah Maghrib Kahla
Hawtah Shaden Sham‘ah ‘Amad Shaybah
Hazmiyah Nuayyim Muraiqib Shutfah
North
Abu Sidr Kassab
Ramlah
Ghinah Waqr Tukhman
Kidan
Umm Jurf
Usaylah South
Layla
Cap rock
Gas
oil and gas fields
Oil of saudi arabia key
Stratigraphic traps occur when a
Jalamid
reservoir layer, also called a bed, Nearly all of Saudi Aramco’s oil and Towns
is sealed by other beds or by a gas fields are located in the Eastern
C a p i ta l
change in porosity or permeability Reservoir rock Province. Other fields are located in
within the reservoir bed itself. and water the Central Province, south of Riyadh, oil field
Kahf
and in the Western Province, on the gas field
Red Sea coast. Total recoverable crude
oil reserves are roughly 260 billion scale in kilometers
barrels—the largest in the world. Sidr Midyan Tabuk
Reserves of natural gas are roughly 0 50 100 Barqan
279 trillion cubic feet, fourth largest
scale in kilometers
re
in the world.
d
Petroleum Traps Oil and gas are formed in organic-rich layers of rock exposed to heat and 0 100 200
se
Umluj
a
pressure, called source rock. The oil and gas will migrate upward through the rock layers where, Al Wajh
if conditions are favorable, they will accumulate in reservoirs, layers of porous and permeable
rock such as limestone or sandstone. The migration of hydrocarbons to the surface is stopped e s t i m at e d w o r l d w i d e c r u d e o i l r e s e r v e s e s t i m at e d w o r l d w i d e g a s r e s e r v e s
by an impermeable layer of rock that acts as a seal, or cap. Oil and gas accumulate only where (billion barrels) as of january 1, 2010 (trillion cubic feet) as of january 1, 2010
260 saudi arabia 1,680 Russia

the reservoir and cap rock form traps.
211 VENEZUELA 1,045 Iran
Geologists classify petroleum traps into two basic types: structural traps, formed by Earth 175 CANADA 895 qatar
movements and rock folds, and stratigraphic traps, the result of the deposition of layers favor- 137 IRAN 279 saudi arabia
115 IRAQ 265 TURKMENISTAN
able to the formation and trapping of petroleum. Two common examples of structural traps are
anticline and fault traps.
Exploration The professionals in Saudi Aramco’s Exploration organization cover Saudi Arabia Sedimentologists and carbonate
geologists in Saudi Aramco’s Core
on a scale that extends from wide swaths of desert, basins and mountains to the micron level. Lab study the separate layers, or
They also consider a fourth dimension in their quest: time, which they measure in the hundreds beds, within hydrocarbon reser-
voirs as revealed by core samples.
of millions of years. Thin sections are cut from the core
samples and examined by company
micropaleontologists, who look for
A new road, cut through a hill, allows
fossils of marine and land organ-
a young geologist to map rock layers
isms, and by palynologists, who
near al-‘Ula, Saudi Arabia.
look for ancient pollens and spores.
This short interval of a core sample,

pulled from 1,468 meters deep in the
Shaybah field, shows the contact
between crude oil and gas. The light
brown section of the core is filled
with Arabian Super Light crude oil
while the gray section is from the
gas column of the reservoir, above
the oil column. The limestone core
is composed of fragments of an
ancient bivalve, and the oil and gas
are stored in the inter-particle pore
spaces between the shell fragments.
The Fossil Record Core samples, drill cuttings, plugs (a kind of mini-core pulled from the
larger core) and thin sections mounted on slides are examined by geoscientists. The rock yields a
wealth of knowledge about the reservoir: porosity and permeability, basic and structural geology,
petroleum physics, stratigraphy, sedimentology and other data.
Geoscientists are especially interested in microfossils such as pollens, spores, protists
(one-celled organisms, including algae, dinoflagellates and others) and Foraminifera—organisms
with calcium carbonate shells. The fossil record illustrates the historical environment of Arabia:
from shallow, warm seas during the Jurassic Period to glaciers and ice sheets when Arabia, in its
continental wandering, was located near the South Pole. A hydrocarbon reservoir is similar
to a sponge soaked with oil and
gas. Two key factors in a reservoir’s
Fossil remains of the single-celled potential productivity are how big
aquatic organisms known as the holes in the sponge are and how
Foraminifera serve as excellent they connect, known as porosity
records of the environment and and permeability. Using a scanning
geologic age of the rock layers in electron microscope, company
which they are found. Foraminifera, scientists can examine the reservoir
with their hard exoskeletons, small rock at the 2- to 5-micron level, close
size, short reproductive cycles, enough to see the individual pores
prolific numbers and wide distribu- in the stone, and better understand
tion over marine environments, are the porosity and permeability of the
especially valuable fossil clues. reservoir. The rock on the left reveals
poor reservoir quality, while the
sample on the right shows excellent
porosity and good permeability.
Company earth scientists and

petroleum engineers use the
latest in 3-D reservoir simulation
technology in the Upstream
Professional Development Center in
Dhahran. Such technology provides
a better understanding of prospects
before an exploratory drilling program
begins, and in reservoir develop-
ment, it helps delineate fields and
place wells to optimize production.
Seismic Imaging Seismic surveying is used in conjunction with structure drilling in the search Reservoir Characterization Reservoir characterization plays a critical role throughout the
for oil and gas. Sound waves, produced by mechanical vibrators mounted on the underside productive life of an oil or gas field. Every producing reservoir has a reservoir simulation model that
of large trucks, penetrate layers of rock thousands of meters beneath the Earth’s surface. The is continually updated with new drilling and production data and is used to develop and evaluate
sound waves are reflected back to the surface where their altered waveforms are recorded as alternative reservoir management strategies. Because of the huge size and large well spacing of
raw seismic data. This information is manipulated by powerful computers to produce an image Saudi Arabia’s hydrocarbon resources, Saudi Aramco has developed its own reservoir simulator,
of the underground rock formations. POWERS (Parallel Oil Water and Gas Reservoir Simulator), to produce 3-D geo-cellular models,
comprising billions of individual cells. These reservoir models are used in reserves estimation and
reservoir simulation models, which are also used to evaluate proposed well locations.
Reservoir Nano-agents: Resbots™ One promising avenue of research in reservoir manage-

ment is the development of nano-scale reservoir robots, called Resbots. Company researchers
are studying the feasibility of deploying Resbots, 1/1,000th the size of a human hair, with the
fluids injected into a hydrocarbon reservoir. Resbots would gather information about reservoir
properties, including pressure, temperature and fluid type, in onboard memory. The Resbots
would be retrieved through production wells and the data downloaded and analyzed, helping
delineate the extent of the reservoir, map fractures and faults in the rock, define areas of higher
permeability, identify bypassed oil, optimize well placement and help design even more precise A multilateral well extends multiple
branches within the hydrocarbon
geological models of the reservoir. For the Resbots concept, the Exploration and Petroleum reservoir. Multilateral wells improve
Engineering Center (EXPEC) Advanced Research Center won the prestigious New Horizons Idea well productivity and reduce field
development costs by requiring fewer
Award at the 2008 World Oil Awards.
wells to produce a field.
Drilling and Reservoir Engineering Drilling is conducted for both exploration and production
purposes. Structure drilling is used to determine key subsurface strata. Wildcat wells are drilled
to test whether oil or gas is present in the structures that geologists have recommended. Once a
new field has been discovered, a number of delineation wells are drilled some distance apart in
order to outline the configuration and size of the field. Finally, the field is put into production by
drilling development wells in a pattern recommended by petroleum engineers. Water injection
wells inject treated seawater to maintain reservoir pressure.
Drilling technology has come a long way since the early days of the industry. Directional
drilling was first introduced in the 1920s, driven by the need to drill from difficult onshore sites
Geologists direct well drilling from
and, later, from offshore platforms. Horizontal wells became popular in the 1980s and were Saudi Aramco’s Geosteering Center
developed for deeper wells in the 1990s. A horizontal well penetrates a reservoir bed across the in Dhahran as real-time information
is transmitted from sensors near the
target zone, rather than down through it, improving recovery rates. More recent developments drill bits. The center operates 24 hours
include multilateral wells, with multiple junctions like the branches of a tree. a day, seven days a week.
Drilling wells, whether for exploration,

delineation, production or water
injection, is at the heart of the petro-
leum industry.
A maximum reservoir contact (MRC) well is a multilateral horizontal well with more than
five kilometers of total contact with the reservoir rock. Such wells also employ “smart” well
features that enable a reservoir management team to intervene remotely. For example, the
team can shut off one lateral without disturbing the remaining laterals. Smart wells also include
downhole sensors, which provide real-time monitoring of the well, helping optimize production
and reservoir management.
A further refinement of the MRC is the extreme reservoir contact (ERC) well, a smart
multilateral well that does not require individual control lines from the wellhead on the surface to
each lateral. This allows an unlimited number of smart laterals, which can be remotely controlled
using real-time data.
The Geosteering Operations Center (GOC) in Dhahran is staffed by teams of geologists and
engineers who monitor drilling operations anywhere in the field. They analyze downhole data
in real time to remotely guide drilling activities and ensure that each well is optimally placed.
Oil & Gas Production and Processing Gas Production and Processing Natural gas is processed to produce clean fuel (methane, or
For a diagram of Saudi Aramco’s oil and gas production operations and a map of production sales gas) and feedstock (methane, ethane, propane, butane and natural gasoline). Sales gas and
facilities, see the Operations Data section. ethane are consumed entirely by Saudi Arabia’s utilities and industry. Excess propane, butane and
Saudi Aramco’s oil and gas production operations encompass Saudi Arabia, including natural gasoline (collectively known as NGL) that are not used by the domestic petrochemicals
territorial waters in the Arabian Gulf and the Red Sea. Totaling more than 1.5 million square industry are exported to world markets.
kilometers, this area is larger than the combined areas of Texas, California, Oklahoma and Utah,
or of France, Spain and Germany.
gas production
Saudi Aramco’s Master Gas System

Oil Production and Processing Most oil-producing wells are free-flowing with a typical oil Sales Gas NGL
(MGS) is fed with two types of gases:
flow rate of 5,000 bpd. Once the oil is extracted, it is piped to a gas-oil separation plant (GOSP) the gases associated with crude
Gas Plant oil that are removed by the gas-oil
where water and the majority of dissolved gases are extracted. The remaining oil is then sent to separation plants (GOSPs), and the
a stabilization facility, such as the Abqaiq Plants, for final gas separation and removal of hydrogen non-associated gases that come from
Sulfur gas wells that do not produce crude
sulfide. The extracted gas is sent to Gas Operations facilities for additional processing, while the oil. Gas processing involves removing
water is injected back into the ground. This oil is now dry (no water), sweet (no hydrogen sulfide) Oil GOSP Gas Condensate the hydrogen sulfide (H2S) and carbon
dioxide (CO2) to produce sweet gas,
and stabilized (no gas), and can be refined or exported. and separating sales gas (methane)
from the heavier components. The
heavier products are liquefied and
This gas-oil separation plant pumped to NGL plants for fraction-
(GOSP) is one of four that ation and final delivery to customers.
Gas Gas
perform the initial processing The H2S is converted to elemental
of oil from the Shaybah field. sulfur and sold to domestic and
Oil export markets.
Water
Water
Associated Gas Non-Associated Gas
Basic process of Gas Plants

Condensate Sour Associated Gas Sour Non-Associated Gas
In the gas plant, gas is received at slug-
catchers, which separate condensate
and water from gas and capture
liquid ”slugs.“ These slugs, traveling
at high velocity, may damage piping
Condensate Low Pressure High Pressure systems. Condensate liquids go to the
Stripper Amine Amine stripping section, where H2S and water
are removed. The separated sour gas
feed goes to the gas treating modules,
where, via contact with alkylamine,
Acid
Gas the H2S and CO2 are stripped away,
creating sweet gas. The sweet gas is
Sweet
Gas compressed and chilled to separate
Sulfur ethane and heavier gases. The H2S-
Recovery and CO2-rich gas, now referred to as
Compression Unit
acid gas, is sent to the sulfur plants
Fluids produced from an oil well Inlet for oil/water/gas mixture Gas outlet
where H2S is converted to elemental
are typically under pressure and sulfur, recovered and made into solid
comprise oil, dissolved gas, salty Liquid
pellets for domestic and export sales.
Sulfur
water and some hydrogen sulfide. Water Dehydration
This mixture is sent to a gas-oil Gas
separation plant (GOSP) for initial
Foam
processing. At the GOSP, a pressure
step-down process releases most Oil
Cooling
of the dissolved gas. A desalting
process then removes the salt Emulsion
water. The resulting sour crude
oil is then sent for stabilization. Water
NGL
Recovery
Water outlet Oil outlet

NGL Sales Gas
Pipelines Saudi Aramco operates a pipeline network nearly 20,000 kilometers long—roughly
equivalent to the flying distance between Rome and Sydney—including flow lines from oil and
gas wells, water injection pipelines and systems for refined products distribution. Major cross-
country pipelines include the Saudi Arabia–Bahrain Pipeline and the East-West Crude Oil and
NGL pipelines to Yanbu‘ on the Red Sea. The NGL pipeline linking Yanbu‘ and Shedgum is the
longest and most advanced gas line ever built—1,170 kilometers long.
Downstream
Downstream encompasses all the activities that occur after crude oil and gas
have been produced and initially processed. The fractionation of natural gas
liquids (NGL), the refining of crude oil and the petrochemical industry are
downstream activities. Shipping and distribution of crude oil and refined
products are also included within this scope.
OSPAS The Oil Supply Planning and Scheduling (OSPAS) organization is the nerve center for the
movement of all of Saudi Aramco’s crude oil, natural gas and refined products. OSPAS plans,
schedules, coordinates and monitors the quantity—and quality—of millions of barrels of crude
oil every day of the year from the wellhead to company terminals.
OSPAS also tracks refined product movements from seven refineries, 19 bulk plants, 18 air
refueling sites, five strategic storage facilities and 1,600 kilometers of refined products pipeline.
It also tracks gas and NGL from six gas plants, three fractionation centers and more than 5,000
kilometers of pipeline. Saudi Aramco also operates 44 export berths at five marine ports, loading
millions of barrels of oil and refined products each day onto supertankers destined for ports in
the world’s three major energy markets: Asia, North America and Europe.
Within OSPAS, the “Big Board” of the Operations Coordination Center (OCC) tracks the
movement of oil, gas, NGL and refined products, and also oversees terminal operations and
electrical power distribution.
Operators in the Operations Coor-

dination Center can, at a glance, see
the entire scope of the company’s
hydrocarbon production and distribu-
tion operations. With the click of a
mouse, operators can check the status
of individual pipeline valves, the feed
rate of a distillation column at a refinery,
the volume of a storage tank or the
loading status of a supertanker. Terminals Saudi Aramco’s enormous storage tank farms and shipping terminals supply crude oil, In addition to linking wells to
processing plants, Saudi Aramco’s
NGL and refined products to customers around the globe. Every year, more than 9,000 tankers
pipeline system delivers crude oil,
call at company terminals at Ras Tanura and Ju‘aymah on the Arabian Gulf, and at Yanbu‘, Jiddah gas, NGL and refined products to
domestic industries and utilities
and Rabigh on the Red Sea.
and to company export terminals.
The Ras Tanura Terminal consists of the South Pier, the North Pier and the Sea Islands.
The South Pier, currently abandoned, is where Saudi crude oil was first loaded onto the
tanker D. G. Scofield in May 1939. The North Pier, connected to the mainland by a 1,200-meter-
long causeway and trestle, operates six berths for the loading of crude oil, refined products and
refined liquid petroleum gasses (RLPG).
The Ras Tanura Sea Islands are a complex of man-made islands approximately 1½ kilometers
northeast of the North Pier. The four Sea Islands (one of which is decommissioned) each feature
a loading station for crude oil and bunker fuel (to power marine vessels) and two berths. Six
supertankers of up to 500,000 deadweight tons can load simultaneously.
Refining Crude oil is a mixture of hydrocarbon molecules, the simplest of which, methane, is
one carbon atom linked with four hydrogen atoms. The three principal groups of hydrocarbon
compounds that occur naturally in crude oil are paraffins, aromatics and naphthenes.
The refining process begins with the distillation, or fractionation, of crude oil into separate
CH4– Methane (Natural Gas)
hydrocarbon groups. Each hydrocarbon fraction has its own boiling point. The light fractions,
such as kerosene, have low boiling points while heavier fractions, such as fuel oil, have high
boiling points.
In the refining process, crude oil is heated in a distillation column, and the vapors resulting
from the boiling are drawn off and condensed. The fractions produced by a distillation column are
only the products that are in the crude oil to begin with—to produce more of a desired fraction,
such as gasoline, refineries must add conversion processes.
The earliest conversion process was thermal cracking, in which the heavy fractions of
C 3H8– Propane
crude oil are heated to a high temperature and the hydrocarbon molecules “cracked” to release
the lighter fractions, gasoline, for example. In visbreaking, residual (heavy oils leftover from the
distillation process) is heated, cooled with gas oil and rapidly burned or flashed. Visbreaking
reduces the viscosity of heavy oils and produces tar. Coking involves heating residual, but at
higher temperatures than visbreaking, until it cracks into heavy oil, gasoline and naphtha. The
heavy, almost pure carbon residue left behind is called coke and is also a commercial product.
Gas
Crude Oil Distillation Column

Naphtha*
* For processing into gasoline or petrochemicals
Reflux
** For further processing into jet fuel
Kerosene**
A crude oil loading line is lifted into

place aboard a supertanker calling
at the Ju‘aymah Offshore Terminal
in the Arabian Gulf.
Light
The Ju‘aymah Offshore Terminal is a crude oil and bunker fuel loading facility designed Diesel Oil
for loading and topping off deep-draft tankers. The loading facilities are roughly 29 kilometers
north-northwest of Ras Tanura and 11 kilometers offshore. The largest supertankers afloat C16H34– Diesel
take on cargo from six single-point moorings (SPM), each with a crude oil loading rate of up to
130,000 barrels per hour. There is also a two-berth RLPG loading facility at Ju‘aymah, accessible Heavy
Light fractions of crude oil, such as
methane and butane, are drawn from
from the shore via a 10-kilometer trestle. Diesel Oil
the top of the distillation column,
The Yanbu‘ crude oil terminal consists of four loading berths, two of which can be used Furnace while heavier molecules, such as diesel,
come from lower in the column.
simultaneously for a combined loading rate of 300,000 barrels per hour. Ships taking on cargo at
Yanbu‘ for Europe or North America can save about 7,400 kilometers (4,000 nautical miles) per
round trip, compared with sailing around the Arabian Peninsula from Ras Tanura or Ju‘aymah.
The Yanbu‘ NGL Plant has an associated two-berth RLPG terminal that can also handle
natural gasoline tankers. The nearby Yanbu‘ Refinery also has its own terminal, consisting of four
Steam The fractional distillation of crude oil
berths for loading fuel oil and marine diesel for cargo or bunker, motor diesel oil, regular and Crude Oil is the first step in the refining process,
premium gasoline, jet fuel, kerosene, naphtha and RLPG. Fuel Oil which yields a range of products, includ-
ing petroleum gas (methane, ethane,
The Jiddah Terminal imports crude oil for the Jiddah Refinery and exports finished and propane and butane); naphtha; gaso-
Asphalt
unfinished naphtha, kerosene, jet fuel, diesel, premium gasoline and fuel oil from four crude oil line; kerosene; gas oil or diesel distillate,
used to make diesel fuel and heating
and refined product berths and five bunker loading berths. oil; lubricating oil; fuel oil; and residuals
Saudi Aramco also operates smaller bulk plant marine terminals at Jazan and Duba. such as coke, asphalt, tar and waxes.
The Saudi Aramco Shell Refinery Co.

(SASREF), a joint venture between
Saudi Aramco and Shell, operates
this refinery complex in Jubail.
Catalytic cracking involves the use of a solid material, called a catalyst, mixed with the oil to help Company (SATORP), a venture with Total of France, will be located in Jubail, and the Red Sea Refining
crack the heavier fractions. The process of hydrocracking adds high-pressure hydrogen gas to catalytic Co., a subsidiary of Saudi Aramco, will be located in Yanbu‘. The third project is a company-owned
cracking, producing additional volumes of gasoline and other light fractions. Catalytic reforming uses refinery and terminal in the Jazan region of southwestern Saudi Arabia. Internationally, Saudi Aramco,
a catalyst to combine low-weight naphtha into aromatics, which are used in blending gasoline and through subsidiary offices, is a joint or equity venture partner in refineries in the United States, the
making chemicals. Republic of Korea, China and Japan.
The various products from the distillation and cracking processes must be treated to remove The Ras Tanura Refinery is the most complex refinery in the company’s domestic portfolio. The
undesirable compounds, such as sulfur, and to meet various performance and environmental specifica- refinery includes facilities for crude oil stabilization and distillation, NGL processing, gas condensate
tions. distillation, hydrocracking, visbreaking and catalytic reforming.
Saudi Aramco operates four domestic refineries, at Riyadh, Ras Tanura, Yanbu‘ and Jiddah, The Yanbu‘ Refinery is a hydroskimming plant, which is more complex than a topping refinery,
and owns 50 percent of two domestic joint-venture refineries, with ExxonMobil in Yanbu‘ (SAMREF) and it produces liquefied petroleum gas, gasoline, jet fuel, diesel oil and fuel oil, mainly for the domestic
and with Shell in Jubail (SASREF). Saudi Aramco also has a 37.5 percent stake in Petro Rabigh, with market. The Jiddah Refinery features catalytic cracking and a catalytic reformer, and is a key supplier
Sumitomo Chemical Co. holding 37.5 percent and the Saudi public 25 percent. Work is also under of fuel to the Jiddah and Makkah areas, especially during peak demand periods such as Ramadan and
way on three additional refining complexes. Two of the projects are 400,000-bpd full-conversion Hajj. The Riyadh Refinery, like the Jiddah facility, contains a vacuum column, which permits processing
refineries integrated with petrochemical facilities: The Saudi Aramco Total Refining and Petroleum of the heavier crude fractions. The Riyadh plant also features a hydrocracker and a catalytic reformer.
Gas Fractionation Natural gas liquids recovered at the gas plants are sent to the NGL frac- Distribution In addition to the giant storage tank farms that feed shipping terminals with crude
tionation plants at Yanbu‘, Ju‘aymah and Ras Tanura for further processing. Typically, NGL plants oil, NGL and refined products, Saudi Aramco operates a vast network of bulk plants and air fueling
receive ethane plus NGL in a combined feed from the gas plants via pipelines. The NGL is then units strategically located throughout Saudi Arabia. Overall capacity of the company’s storage
pumped to the de-ethanizer columns in the fractionation modules, where the ethane is separated facilities for all hydrocarbons is roughly 200 million barrels. Pipelines, marine crude oil tankers,
overhead as a vapor product. The ethane is sent to consumers as petrochemical feedstock or product carriers and trucks are the principal delivery systems for the company’s petroleum and
injected into the sales gas system. The heavier gas at the bottom of the de-ethanizer column is petroleum products.
fractionated in additional steps, yielding propane, butane, natural gasoline, hexane and pentane. Through its 19 bulk plant operations, Saudi Aramco annually supplies around 375 million
Natural gasoline and pentane are blended and sent to refining, while the hexane and heavier barrels of refined products to about 5,000 domestic bulk customers. Compliance reviews and
components are used as feedstock for petrochemical plants. periodic spot checks are conducted to assist in maintaining product quality and to assure opera-
tions compliance with established safety and environmental policies and procedures.
Approximately 2,000 trucks are used to transport refined products over the Kingdom’s
150,000 kilometers of highways. The use of these trucks, which are subject to strict safety and
quality standards, is being minimized as Saudi Aramco replaces them with new pipeline systems.
Shipping vessels account for almost all of Saudi Aramco exports of crude oil, NGL and
refined products and are also used to transport hydrocarbons to supply and distribution facilities
on the Red Sea.
The company’s shipping subsidiary, Vela International Marine Limited, was established in
1984, when rights to Vela’s name and four existing tankers were acquired. Vela currently operates
a fleet of 17 very large crude carriers (VLCCs), each capable of carrying 2.1 million barrels of crude
oil. Vela also owns and operates five product tankers that perform coastal trade in the Red Sea
The Saiph Star, a double-
and the Arabian Gulf. Overall, Vela ships make roughly 1,000 voyages per year—83 percent of hull crude oil carrier, joined
which are international, with the remainder domestic—safely transporting roughly 2 million bpd. the Vela fleet in 2009.
The Master Gas System, which The sales gas (methane) system is extensive, covering large areas of Saudi Arabia from
handles more than 9 billion standard coast to coast. Adding to its complexity is the integration and interdependence of the three main
cubic feet per day of gas, provides
fuel and feedstock to domestic indus- systems: oil, gas and NGL.
tries, such as this plant in Jubail. The sales gas system depends greatly on oil production, since associated gas represents a
significant part of the system feed. It is also fully integrated into the NGL system, since any NGL
component recovered during processing causes a reduction in the sales gas supply. Sales gas is
piped to more than 54 industrial customers, including power, desalination and petrochemical
plants, throughout the Eastern, Central and Western provinces of Saudi Arabia.
The Ju‘aymah and Yanbu‘ gas plants receive ethane (C2) plus NGL, and Ras Tanura receives
propane (C3) plus NGL for fractionation and sweetening. The Ju‘aymah plant also receives C3 plus
NGL streams from the Berri Gas Plant and the Qatif and Abqaiq crude stabilization facilities. The
Ju‘aymah and Yanbu‘ gas plants produce ethane, propane, butane and natural gasoline products,
while the Ras Tanura Refinery produces all but ethane. The Ju‘aymah facility also has a depentanizer
column and associated facilities necessary for the delivery of a hexane (C6) stream to petrochemical
customers in Jubail. Propane is primarily used as petrochemical feedstock in the industrial cities of
Yanbu‘ and Jubail and the excess is exported. Butane is used as domestic petrochemical feedstock
and is also exported as a liquid. NGL products are used to produce more than 50 petrochemical
products and are sold to customers in more than 100 countries worldwide.
Petrochemicals The petrochemical industry traces its roots to World War II, when the demand The next year, Saudi Aramco and The Dow Chemical Co. began exploring the possibility of
for synthetic materials rose due to shortages of, and lack of access to, natural resources. Before building a petrochemical complex. The proposed joint venture, to be located in the Jubail industrial
the war, petrochemicals were an experimental sector: synthetic rubbers were developed in the area, is perhaps the largest and most complex project in Saudi Aramco’s downstream portfolio.
early 1900s; Bakelite, the first petrochemical-derived plastic, in 1907; and polystyrene in the The project proposal includes chemicals and plastics production units and an associated conversion
1930s. Today, petrochemicals are found in furniture, kitchen appliances, medical equipment, park for local and foreign private-sector companies to build industries to use the products.
automobiles, airplanes and ships, soaps and detergents, solvents, drugs, fertilizers, pesticides,
computers, paints, epoxies, clothing and shoes, flooring and insulating materials, cosmetics,
luggage, and recording disks and tapes.
The final destination of most crude

Natural Gas Crude Oil
oil is the fuel tank of a vehicle, whether
a motorcycle, car, truck, airplane or
train. Saudi Aramco exports of crude
oil power the transportation industries
in Europe, North America and Asia—
in this case, China.
Associated
NGL Naphtha
Gases
Methane Methane LPG Ethane
Xylenes Toluene Benzene Pygas C4 box* Propylene Ethylene
Petrochemical facilities receive their raw material, known as feedstocks, from refineries
and NGL and gas plants. Feedstocks include ethane, naphtha, propane, butane and hexane,
a r o m at i c s Olefins
among others. These feedstocks are then further cracked to create the basic building blocks for
petrochemical products: olefins (mainly ethylene, propylene and the C4 derivatives, including Xylenes Toluene Benzene Pygas C4 box* Propylene Ethylene
Solvents, dyes, fibers Industrial chemicals Plastics used in boats, Used for gasoline Synthetic rubbers Resins, fibers and Plastics, polyesters
butadiene) and aromatics (benzene, toluene, xylene and naphthalene). and films used in used in coatings, cars, computers, food blending or as and plastics used in plastics used in and synthetic rubber
A significant proportion of the basic petrochemicals are converted into polymers: polyethylene, products such as sealants, adhesives, containers and pack- feedstock. such products as such products used in products
polyester fibers paints and the foam aging, construction automotive parts, as detergents, such as luggage,
polyvinyl chloride and polystyrene, all derived from ethylene, and polypropylene, derived from and plastics and in used in furniture, materials, nylon, toys, tires, aviation gaso- solvents, varnishes, appliances, automo-
plasticizers, sub- bedding, car seats carpets, shampoo, line and the gasoline super-absorbent tive parts, footwear,
propylene. Polymers are used in plastics, synthetic rubbers and synthetic fibers, such as polyester,
stances that make and building cleaning products, additive MTBE. materials, acrylic flooring and tires.
nylon and acrylic. plastics more flex- insulation. emulsifiers and fibers, pharmaceu-
ible and are used pharmaceuticals. ticals, cosmetics and
Beginning in the 1990s with a series of international joint and equity ventures in refining and in medical tubing food packaging.
marketing, Saudi Aramco has been transforming itself from a crude oil producing and exporting and blood bags,
toys and footwear.
company into an integrated petroleum enterprise, with activities all along the value chain. The
most recent development in the company’s transformation is the petrochemical sector. The
goal is to create more value from Saudi Arabia’s hydrocarbon resources, principally by bringing
petrochemicals processing and manufacturing to the Kingdom rather than exporting commodity petrochemicals
petrochemicals to foreign markets where they are used in associated industries. The petrochemical industry converts * Butylene, butadiene
crude oil and natural gas into basic and derivatives
In March 2006, Saudi Aramco and Sumitomo Chemical Co. of Japan broke ground on the petrochemical building blocks that,
Petro Rabigh joint venture, one of the world’s largest integrated refining and petrochemical facilities. in turn, are used to produce consumer
goods ranging from heart valves
The complex commenced operations in early 2009 and has the capacity to produce 18.4 million to raincoats.
tons of high-value petroleum products and 2.4 million tons of ethylene- and propylene-based
petrochemical derivatives per year. An associated industrial city will use the materials produced by
Petro Rabigh to manufacture a wide range of products for local and international consumption.
Safaniya
Tanajib Jubail
Nariya
Ju‘aymah
Khursaniyah Ras Tanura

Qatif
Berri Dammam
iraq Dhahran
Abqaiq
Operations Data Turaif

Shedgum
Qurayyah
Badanah al-Hasa
jordan
Sakaka
Khurais ‘Udhailiyah
al-Jawf ‘Uthmaniyah
Dawmat
■ Domestic Operations Map al-Jandal Rafha
■ International Operations Map kuwait Haradh
Tabuk
■ Oil and Gas Operations Hafar al-Batin
Qaisumah Safaniya
Tayma al-Khafji
■ Production and Workforce History Duba
Hayil Tanajib
Nariya Jubail
al-‘Ula
al-Wajh Ras Tanura
Buraydah Qatif Dammam
al-Zilfi Abqaiq Dhahran
‘Unayzah Hofuf
Khaybar
al-Hasa
Khurais Hawiyah
Madinah il pi pel ine Riyadh Salwah
Yanbu‘ crude o
east-west al-Dawadimi
ngl pipel
ine al-Kharj Haradh
east-west united arab
saudi arabia e m i r at e s
Rabigh
Layla
Jiddah Makkah
oman
Tayif
al-Sulayyil
al-Bahah
Bishah
Tathlith
Abha Khamis Mushayt
Najran ash-Sharawrah
Jazan
yemen
d o m e s t i c o p e r at i o n s
key
Towns d o m e s t i c r e f i n e ry major crude oil pipeline
C a p i ta l j o i n t / e q u i t y v e n t u r e r e f i n e ry major ngl pipeline
s e a w at e r t r e at m e n t p l a n t crude oil terminal trans-Arabian pipeline
gas processing plant refined products terminal S h ay b a h - a b q a i q p i p e l i n e
I n t e g r at e d r e f i n e r y a n d domestic refined products terminal

petrochemical plant scale in kilometers
ngl terminal
major oil processing complex 0 200
oil field
domestic refined products
gas field
d i s t r i b u t i o n fa c i l i t y
> S-Oil Corporation

Seoul
republic
of korea Toyko
> Saudi Petroleum j a pa n
> Saudi Petroleum Ltd.
Overseas Ltd.
> Aramco Overseas
> Aramco
Overseas Company B.V.
Company B.V. > Showa Shell Sekiyu K.K.
London The Hague | Aramco Overseas Company B.V.
Rotterdam
> Texaco Esso AOC Maatschap
> TEAM Terminal B.V.
Saudi
Petroleum Ltd.
Beijing
at l a n t i c O c e a n > Aramco
Overseas Aramco Overseas Company B.V.
Company B.V. Shanghai
New Delhi > Fujian Refining and
Pa c i f i c O c e a n Petrochemical Co. Ltd.
> Sinopec SenMei (Fujian) Fujian Okinawa
Petroleum Co. Ltd.
Hong Kong
> Aramco Overseas Company B.V.
> Saudi Aramco Sino Co. Ltd.
New York City

Saudi Petroleum International Ltd. indian Ocean Singapore
Washington, D.C. Saudi Petroleum Ltd.
Aramco Services Company
u n i t e d s tat e s
> Aramco Services Company

Sidi Kerir
> Saudi Refining Inc.
> Motiva Enterprises LLC Aramco Gulf
Houston Operations Co. Ltd.
Ain Sukhna al-Khafji > MARAFIQ
LOOP > Luberef Jubail | > Saudi Aramco Shell
SUMED Arab
Petroleum > Saudi Aramco Mobil Refinery Co. (sasref)
Pipelines Co. Refinery Co. Ltd. (SAMREF) Dhahran
> MARAFIQ Ju‘aymah Dubai
Yanbu‘ Vela International
Ras Tanura
Marine Limited
Rabigh | Petro Rabigh
Thuwal saudi arabia
Jiddah
> Luberef
> Jiddah Oil Refinery Co.
i n t e r n at i o n a l o p e r at i o n s
key
Towns m a r a f i q : E l e c t r i c i t y a n d W at e r p r i n c i pa l e x p o r t r o u t e s
Saudi Aramco Headquarters

U t i l i t y f o r J u b a i l a n d Ya n b u ‘ v e l a s h i pp i n g r o u t e s
Luberef: Saudi Aramco
a f f i l i at e , s u b s i d i a r y o r L u b r i c at i n g O i l R e f i n e r y C o .
joint/equity venture
loop: Louisiana offshore oil port
long-term storage and
t e r m i n a l fa c i l i t i e s lightering areas
ports
Abu Zuluf Qatif Khursaniyah Shaybah Ghawar

Hadriya
Berri Shedgum ‘Uthmaniyah Khursaniyah Haradh Hawiyah
Marjan Safaniya Abu Sa‘fah Berri Abqaiq Harmaliyah
Qatif Abqaiq Hawiyah
Qatif Ras Tanura Jubail Yanbu‘
Tapline Abqaiq
MARAFIQ
Dhahran Ras Tanura Ju‘aymah Yanbu‘

Tanks
Central
Khurais Arabian
Jubail*** Ras Tanura Bahrain* Fields
Ras Tanura Ju‘aymah Yanbu‘
Ras Tanura Yanbu‘
Ju‘aymah
Petro
Riyadh Yanbu‘** Rabigh Jiddah
SWCC MARAFIQ
g a s o p e r at i o n s key
Gas produced with crude oil is Gas produced independently of crude n o n - a s s o c i at e d marafiq:
o i l o p e r at i o n s key gas wells electricity
collected from gas-oil separation plants oil (non-associated gas) is processed at
and fed to gas processing plants. There, the Haradh and Hawiyah gas plants a n d w at e r u t i l i t y
The crude oil produced by Saudi Aramco oil Field r e f i n e ry gosp: gas-oil
for jubail and
impurities are removed, hydrogen for delivery into the sales gas system. s e pa r at i o n p l a n t
from both onshore and offshore fields
gosp: gas-oil i n t e g r at e d r e f i n e r y a n d sulfide is recovered for conversion into The Hawiyah NGL Plant processes
ya n b u ‘
first goes to gas-oil separation plants for petrochemical plant Gas Plant
s e pa r at i o n p l a n t elemental sulfur, and sweet, dry gas is sweet gas from the Hawiyah and swcc: saline
removal of gases, water and salt, after
Local customer extracted for use as an industrial fuel or Haradh gas plants. NGL from the N G L : n at u r a l g a s w at e r c o n v e r s i o n
which it is sent for further processing s ta b i l i z e r
feedstock. From gas processing centers Berri Gas Plant goes to Ju‘aymah or liquids plant c o r p o r at i o n
at stabilizers or refineries. Most of plant * The refinery in Bahrain is not
at Shedgum, Hawiyah, Khursaniyah and Ras Tanura for fractionation. LPG is industrial complex terminal
the crude oil is delivered to tankers at a Saudi Aramco facility.
Ras Tanura, Ju‘aymah or Yanbu‘.
terminal ‘Uthmaniyah, NGL (natural gas liquids) exported from Yanbu‘ and Ju‘aymah.
o t h e r i n d u s t ry
** Two Yanbu‘ refineries and ethane are piped to plants at From the fractionation plants, f r a c t i o n at i o n p l a n t
(one joint venture) Yanbu‘ and Ju‘aymah for fractionation. ethane is delivered to the industrial saudi electric
*** Joint venture After removal of the ethane, the NGL is complexes at Yanbu‘ and Jubail for c o m pa n y
further fractionated into LPG (propane use as a petrochemical feedstock.
and butane) and natural gasoline.
1938 1.36
1939 10.78
200 appendix
1940 13.87
1941 11.81
of crude oil and NGL

12.41
Average daily production

1942
1943 13.34
1 9 3 8 – 2 0 1 0 (thousands of barrels)
1944 21.30
1945 58.39
164.23
s a u d i a r a m c o p r o d u c t i o n h i s t o ry
1946
1947 246.17
key
1948 390.31
1949 476.74
1950 546.70
crude oil
1951 761.54
1952 824.76
1953 844.64
N at u r a l G a s L i q u i d s
1954 953.00
1955 965.04
1956 986.13
1957 992.11
1958 1,015.03
1959 1,095.40
1960 1,247.14
1961 1,392.52
1962 1,520.70
2.90
1963 1,629.02
5.80
1964 1,716.11
11.01
1965 2,024.87
13.87
1966 2,392.74
15.56
1967 2,597.56
20.40
1968 2,829.98
38.47
1969 2,992.66
46.17
1970 3,548.87
52.12
1971 4,497.58
52.07
1972 5,733.40
54.07
1973 7,334.65
97.12
8,209.71
1974
137.63
6,826.94
1975
141.42
8,343.95
1976
184.78
9,016.95
1977
219.45
8,066.11
1978
253.11
9,251.08
1979
309.26
9,631.37
1980
369.23
9,623.83
1981
448.17
6,327.22
1982
429.50
4374.30
1983
330.10
3,922.08
1984
355.07
3,041.10
1985
316.31
4,689.80
1986
304.18
3,991.00
1987
344.92
4,928.10
1988
416.21
4,863.53
1989
420.95
6,257.56
1990
533.23
8,053.40
1991
586.74
8,156.57
1992
622.06
7,854.74
1993
639.76
7,833.28
1994
687.93
7,807.63
1995
731.85
7,864.83
1996
756.15
7,751.93
1997
767.45
8,006.24
1998
764.83
7,274.05
1999
737.35
7,800.07
2000
778.71
7,570.64
2001
801.05
6,792.32
2002
868.32
8,103.45
2003
945.43
8,610.58
2004
1,058.14
9,064.62
2005
1,096.94
8,912.17
2006
1,093.24
8,531.91
2007
1,081.00
8,924.14
2008
1,098.92
7,912.56
2009
1,123.96
7,910.20
2010
1,219.30
appendix 201
115
key
1935 26 141
1,076
202 appendix
1936 62 1,138
548
saudi
1937 54 602
2,745
1938 340 3,085
e x pat r i at e
3,178
1939 463 3,641
2,668
t o ta l w o r k f o r c e
1940 382 3,050
1 9 3 5 – 2 0 1 0 ( at y e a r - e n d )
1,647
1941 193 1,840
1,654
1942 171 1,825
2,692
s a u d i a r a m c o w o r k f o r c e h i s t o ry
1943 190 2,882
7,585
1944 1,475 9,060
8,087
1945 3,379 11,466
7,297
1946 2,684 9,981
12,018
1947 4,879 16,897
12,226
1948 7,379 19,605
10,026
1949 6,099 16,125
10,767
1950 6,734 17,501
13,786
1951 8,852 22,638
14,819
1952 10,273 25,092
14,051
1953 9,393 23,444
14,665
1954 8,782 23,447
13,844
1955 8,091 21,935
13,671
1956 7,535 21,206
13,222
1957 6,635 19,857
12,572
1958 6,076 18,648
12,216
1959 5,408 17,624
11,660
1960 4,296 15,956
11,442
1961 3,558 15,000
11,341
1962 3,124 14,465
10,892
1963 2,998 13,890
10,805
1964 2,999 13,804
10,793
1965 2,958 13,751
10,761
1966 2,848 13,609
10,294
1967 2,678 12,972
9,894
1968 2,483 12,377
9,438
1969 2,213 11,651
9,133
1970 2,099 11,232
9,109
1971 2,225 11,334
9,590
1972 2,575 12,165
10,636
1973 3,334 13,970
12,432
1974 4,390 16,822
14,931
1975 5,451 20,382
15,187
1976 6,543 21,730
16,740
1977 8,787 25,527
17,894
1978 16,755 34,649
21,839
1979 20,413 42,252
26,321
1980 24,260 50,581
29,753
1981 27,885 57,638
33,067
1982 28,165 61,232
34,226
1983 24,736 58,962
34,882
1984 23,273 58,155
33,382
1985 18,209 51,591
31,906
1986 13,958 45,864
31,623
1987 12,555 44,178
32,085
1988 12,399 44,484
31,712
1989 12,216 43,928
32,106
1990 11,582 43,688
32,900
1991 12,948 45,848
33,847
1992 13,008 46,855
34,615
1993 14,107 48,722
44,938
1994 12,548 57,486
46,180
1995 11,596 57,776
12,216
1996 5,408 56,480
46,133
1997 10,347 56,345
46,172
1998 9,360 55,532
45,586
1999 8,490 54,076
46,315
2000 8,186 54,501
45,869
2001 8,208 54,077
46,496
2002 7,991 54,487
46,365
2003 7,589 53,954
45,505
2004 7,015 52,520
44,991
2005 6,852 51,843
44,702
2006 6,654 51,356
45,464
2007 6,629 52,093
47,502
2008 6,939 54,441
48,053
2009 7,013 55,066
47,741
2010 7,057 54,798
appendix 203
204 company ceos company ceos 205
Company Leadership
Company CEOs Company Presidents Chairmen of the Board of Directors
Fred A. Davies Liston F. Hills R. C. Stoner Robert I. Brougham

1940–1947 1969–1971 1943–1944 1969–1970
W. F. Moore Frank Jungers Harry D. Collier Liston F. Hills
1947–1952 1971–1973 1944–1951 1970–1973
Robert L. Keyes R. W. ”Brock“ Powers William S. S. Rodgers Frank Jungers
1952–1957 1973–1978 1951–1952 1973–1978
Norman Hardy Hugh H. Goerner Fred A. Davies John J. Kelberer
1958–1959 1978–1983 1952–1959 1978–1988
Thomas C. Barger Ali I. Al-Naimi Norman Hardy Hisham M. Nazer
1959–1968 1984–1995 1959–1968 1988–1995
Harry D. Collier R. C. Stoner William S. S. Rodgers Fred A. Davies Norman Hardy Robert I. Brougham Abdallah S. Jum‘ah Thomas C. Barger Ali I. Al-Naimi
1940–1941, 1944–1951 1941–1944 1951–1952 1952–1959 1959–1961 1968–1969 1995–2008 1968–1969 1995–
Khalid A. Al-Falih
2009–
On May 29, 1933, the oil concession agreement was signed between Saudi Arabia and Standard Oil Company of California (Socal).
On November 8, 1933, a subsidiary, California Arabian Standard Oil Company (Casoc), was created to manage the concession.
Casoc operated until January 1944, when the company’s name changed to the Arabian American Oil Company (Aramco).
On November 8, 1988, the Saudi Arabian Oil Company (Saudi Aramco) was established.
Thomas C. Barger Robert I. Brougham Liston F. Hills Frank Jungers John J. Kelberer
1961–1969 1969–1970 1971–1973 1973–1977 1978–1988
Ali I. Al-Naimi Abdallah S. Jum‘ah Khalid A. Al-Falih

1988–1995 1995–2008 2009–
206 acknowledgments acknowledgments 207
Acknowledgments
oral history interviews Maram M. Al-Dowayan Ali I. Al-Naimi institutions Beresky, Bader Eid Biltagi, Idrees M. Bodah, David D. Bosch, Neil Brown, Salah
conducted by the history Samia Al-Edrisi Ahmad S. Al-Nassar Repositories, Archives, College Libraries, etc. S. Al-Buraiki, Tina Pakka Cape, Edna K. Catchings, Arthur P. Clark, Basima K.
factory
Mike Erspamer Soulafa Al-Nassar Al-Saleh Darwaza, James C. Davidson, Peter Davidson, Abdullah A. Al-Deraibi,
Saudi Arabia
Former and Current Employees Khalid A. Al-Falih Ismail Ibrahim Nawwab Mohammad G. Al-Domaini, Saad F. Al-Dosari, Adel H. Al-Dossary, Dick Doughty,
King Abdulaziz Foundation for Research and Archives, Riyadh
Mustafa Abuahmad Khalid Afandi Robert Norberg Nasser Mohammed Al-Dowayan, Gregory J. H. Dowling, Khaled M. Al-Dukeer,
King Abdulaziz Public Library, Riyadh, Dr. Abdul Kareem A. Al-Zaid,
Khalid I. Abubshait Abdulla Fouad Naser Al-Nughaimish David Duncan, Ralph Echezuria, Galal T. Elkhatib, Deya A. Elyas, Dwight
Deputy Supervisor General
Khalid A. Afandi Bidah Mejdal Al-Gahtani Abdullatif A. Al-Othman Fullingim, Steve Furman, Tony Germani, Michael Gerow, Fouzi M. Al-Ghaithi,
King Fahd National Library, Riyadh, Mohammed A. Al-Rashid,
Abdulkader M. Afifi Fahad Muhammad Al-Ghaslan Kathleen M. Owen Ibrahim A. Al-Ghamdi, Khalid S. Al-Ghamdi, Mohammed S. Al-Ghamdi, Saleh
Vice General Director
Abdulaziz Omer Al-Ajaji Huda M. Al-Ghoson Richard B. Owen Ghazi Al-Ghamdi, Ahmad H. Al-Ghannam, Nasser H. Ghazzawi, Mohammed
Ministry of Petroleum and Mineral Resources, Riyadh
Nassir M. Ajmi Maxine Steineke Goad Thomas A. Owen A. Al-Ghuwinim, Arthur E. Gregory, Ahmed M. Al-Gusaier, Mohammad
Saudi Aramco Community Heritage Gallery, Dhahran
Mohammed Saeed Salman Al-Ali Geraiyan Mohammad Al-Hajri David G. Peck A. Al-Haddad, Quraiyan Mohammad Al-Hajri, Saad S. Al-Hajri, Bandar S.
United States Consulate, Dhahran
Othman Alkhowaiter Samir Ahmad Hassan Jairo Antonio Plata Torres Al-Hakami, Ziyad Al-Hamidi, Mohammed O. Hammadi, Mona S. Hassan, Zaid
Matter J. Alshammery Ali Y. Al-Hauwaj Thomas A. Pledge International Mohammad Al-Hazmi, Ghalib Moghram Al-Houtan, Charles V. Hudson,
Nabilah Altunisi Abdulaziz M. Al-Hokail John E. Pratt American Petroleum Institute, Washington, D.C., United States Geraint W. Hughes, Haitham K. Al-Jehairan, Mashal M. Jehani, Abdulkarim
Khalid Ali Alturki Charles V. Hudson Bidah Al-Qahtani Aramco ExPats.com M. Al-Juhani, S. I. M. Kauser, Thomas H. Keith, Mark W. Kennedy, Abdelkan
Michael Ameen Ahmed Saleh Al-Humaid Hamed T. Al-Saadoun Aramco Services Company, Houston, Texas, United States K. Khalil, Abdelkarim K. Khalil, Dr. Saadeh Khalil, Ibrahim Y. Koheji, Norman
Ibrahim Al-Anaysha Dr. Sadad Al-Husseini Abd Allah S. Al-Saif Bechtel Corporation, San Francisco, California, United States H. Kong, Elizabeth C. Lacsamana, Robert W. Lebling, Robert F. Lindsay, Jose
Richard Arnold Abdallah S. Jum‘ah Muhammad A. Salamah Bapco, Bahrain A. D. de Luna, Mohammed A. Mahtersh, Richard Maise, James P. Mandaville,
Dr. Thuraya Al-Arrayed Frank Jungers Nansen G. Saleri BP p.l.c., London, United Kingdom Maha A. Al-Mansoury, Saeed N. Al-Marri, Timothy W. Martin, Mark McCarthy,
Sa‘ud Abdulrahman Al-Ashgar Hamad A. Juraifani Ali Seflan Chevron Corporation, San Ramon, California, United States Brian J. McKeage, Jeff D. Meisner, Abdalmatloob Ali Al-Mohammadi, Fadi S.
Mona Al-Attas Mohammad A. Al-Juwair Maha S. Shahid Columbia University, New York, New York, United States Al-Mubarak, Ibrahim A. Al-Muhaiza, Mohammad A. Mulla, Fayez S. Al-Mutairi,
Fatema H. Al-Awami Syed I. Masood Kauser Sa’ad R. Al-Shaifan Embassy of Saudi Arabia, Washington, D.C., United States Nazih F. Najjar, Ni‘mah I. Nawwab, Gregory C. Noakes, Hussain A. Al-Obaid,
Ali M. Al-Baluchi Thomas H. Keith Matter J. Al-Shammery ETH Bibliothek, Zurich, Switzerland Hani A. Al-Omair, Khalid Abdulrahman Al-Omair, Saad M. Al-Omani, Alaa A.
Henry Barracano Dr. Saadeh A. Khalil Richard J. Snedeker ExxonMobil Corporation, Irving, Texas, United States Othman, Kathleen M. Owen, Owen Oxley, Alex M. Padippurathu, Honorio S.
Fahmi Basrawi Abdulaziz F. Al-Khayyal Louis C. Spencer Georgetown University, Washington, D.C., United States Pangan, Janis E. Patton, David G. Peck, Thomas A. Pledge, Adel Ali Al-Ramadhan,
Faysal M. Al-Bassam Othman Al-Khowaiter Muhammad A. Tahlawi Harvard University, Cambridge, Massachusetts, United States Saleh M. Al-Rushaid, Abdullah A. Al-Saadoun, Sami A. Sa‘ati, Fawzi A. Al-Sadah,
Jimmy K. Beresky, Jr. Ibrahim Y. Koheji Abdulaziz A. Talhah Library of Congress, Washington, D.C., United States Ali Al-Salem, Samer S. Samman, Nestor Sander, Ahmed S. Al-Saqer, Saud
Bader Eid Biltagi Robert W. Lebling Aus A. Al-Tawil National Archives and Records Administration, Washington, D.C., Abdulah Al-Saqri, Paul E. Sauser, Moneer A. Sayed, Michelle M. Seaters-
Khalid G. Al-Buainain Leslie Lewis Saad A. Turaiki United States Alireza, Douglas C. Seedorf, Hisham A. Shah, Khalid S. Al-Shahab, Omar M.
Dave L. Cantrell William Laney Littlejohn Dhaifallah A. F. Al-Utaibi Oberlin College, Oberlin, Ohio, United States Al-Shahrani, Saad A. Al-Shahrani, Ahmed Abed Shaikh, Khalid G. Al-Shammari,
Victor C. Crane Dr. Ibrahim S. Mishari Capt. Khalid A. Al-Watban OPEC, Vienna, Austria Zaki M. Al-Shobber, Arafat A. Al-Shurei, Ken Slavin, Richard J. Snedeker, Peter
Dr. Tawfiq Q. Al-Daiel Mohammad R. Al-Mughamis John M. Weatherburn President Harry S. Truman Library, Independence, Missouri, United States C. Speers, Gordon P. Tobert, Yousef S. Al-Ubaid, Khalid D. Al-Usail, Chris P. Vice,
James C. Davidson Ali A. Al-Muhareb Princeton University, Princeton, New Jersey, United States Keith G. Wallis, Khalid A. Al-Watban, Marilyn Bunyan Wilkens, Christopher
Hamad M. Al-Dhewalia Hesham Al-Musaiid Royal Geographical Society, London, United Kingdom Wszolek, Faisal S. Al-Zahrani, Abdullah S. Zaindin and James G. Zibbel.
Smithsonian National Museum of American History, Washington, D.C.,
Appreciation is also extended to people who provided assistence for this book
United States
but were inadvertently not included in the above list.
Stanford University, Stanford, California, United States
University of California, Berkeley, California, United States About the Author
University of Utah, Salt Lake City, Utah, United States Scott McMurray has authored several landmark books for The History Factory’s
University of Wyoming, Laramie, Wyoming, United States clients, including the histories of consulting industry leader Accenture, biotech
pioneer Chiron and one of America’s leading health-care innovators, Sutter
People who assisted with this book
Health System.
Marwan A. Abdrabuh, Abdulrahman M. Al-Abdulqader, Abdulaziz S. Abubshait,
Khalid A. Afandi, Graeme Agland, Eyad M. Ajaj, Khalid A. Albahkali, Yousef A. A former senior writer with The Wall Street Journal, Scott has more than 25 years’
Al-Ali, Shawki M. Alsukairi, Harry Alter, Hassan H. Al-Amri, Ibrahim Al-Anayshah, experience in business writing, research and analysis of corporate strategy. A graduate
Wael Faisal Al-Angari, Ross and Patty Atkinson, Tariq A. Al-Awaisi, Ensan M. of Grinnell College with a BA in English Literature and American Studies, Scott is a
El-Ayoubi, Fahad S. Al-Aziz, Saad Said Azzahri, Nabil A. Ba‘ashan, Mohamed A. member of the Phi Beta Kappa academic honor society and the Authors Guild.
Bagais, Raed M. Bahomaid, Robin J. Bally, Tim Barger, Ralph D. Bears, Catarina P.
list of abbreviations 209
List of Abbreviations
AAPG American Association of Petroleum Geologists MRI magnetic resonance imaging
AMDP Aramco Mobile Drilling Platform NEDC Near East Development Company
Aminoil American Independent Oil Company NGI Natural Gas Initiative
AOC Aramco Overseas Company NGL natural gas liquids
APP Associate Professional Program NOC national (or state-owned) oil company
Aramco Arabian American Oil Company OAPEC Organization of Arab Petroleum Exporting Countries
ASC Aramco Services Company OCC Operations Coordination Center
Bapco Bahrain Petroleum Company OPEC Organization of Petroleum Exporting Countries
BP British Petroleum Company PDP Personal Development Program
bpd barrels per day PDP Professional Development Program
Casoc California Arabian Standard Oil Company POWERS Parallel Oil Water and Gas Reservoir Simulator
CAT computer-aided tomography ppb parts per billion
CDPNE College Degree Program for Non-Employees PRC Petroleum Reserves Company
CERA Cambridge Energy Research Associates R&D research and development
E&P Exploration and Production SABIC Saudi Arabia Basic Industries Corporation
EXPEC Exploration and Petroleum Engineering Center SAG Saudi Arabian government
EXPEC-ARC Exploration and Petroleum Engineering Center’s Advanced Samarec Saudi Arabian Marketing and Refining Company
Research Center
SAMCOM Saudi Arab Manpower Committee
FREP Fujian Refining and Petroleum Company Ltd.
SASC Saudi Aramco Cino Ltd.
GOSP gas-oil separation plant
Saudi Aramco Saudi Arabian Oil Company
GPS global positioning system
SCECO Saudi Consolidated Electrical Company
IDD Industrial Development Division
scfd standard cubic feet per day
IEA International Energy Agency
Socal Standard Oil Company of California
IOC international oil company
Socony Standard Oil Company of New York
IPC Iraq Petroleum Company
SSPC Sinopec SenMei (Fujian) Petroleum Co. Ltd.
IT information technology
SRAK South Rub‘ al-Khali Company Ltd.
ITC Industrial Training Center
Tapline Trans-Arabian Pipeline or Trans-Arabian Pipe Line Company
Jersey Standard Oil Company of New Jersey
TOEFL Test for English as a Foreign Language
KAUST King Abdullah University of Science and Technology
TPC Turkish Petroleum Company
KFUPM King Fahd University of Petroleum and Minerals
UAE United Arab Emirates
LPG liquefied petroleum gas
ULCC ultra-large crude carrier
MGS Master Gas System
VLCC very large crude carrier
MIT Massachusetts Institute of Technology
ZHI al-Zamil Heavy Industries
MRC maximum reservoir contact (well)
210 notes on sources notes on sources 211
■ On “Rock Wednesday,” see Fred H. Drucker’s interview in the Saudi Aramco ■ On rising oil prices in the 1970s, see “Oil Crisis Averted in Tehran,”
Oral History Project collection; Richard W. Powers’s interview in the Regional Washington Post, 14 February 1971, and “The Oil Settlement at Tehran,”
Oral History Office collection; and Richard W. Powers’s interview in the Aramco Washington Post, 17 February 1971. For a firsthand perspective, see Frank
Resource Library. Jungers‘s interview in the Regional Oral History Office collection.
■ On Saudization of Aramco’s management, see Mustafa Abuahmad’s ■ On the transfer of oil companies to government ownership, see Thomas J.
interview in the Aramco Resource Library. Hamilton, “Oil Nations Seeking 20% Interest,” New York Times, 29 January
1972; “Oil Accord Signed by 2 Arab States,” New York Times, 22 December
■ On the 1967 oil embargo, see “Saudi Oil Minister’s Statement to Al-Madinah
1972; Juan de Onis, “Saudi Displeased with Her Oil Pact,” New York Times,
Al-Munawwarah,” Middle East Economic Survey, 14 July 1967.
11 September 1973; and John M. Lee, “Oil Companies Drop Demand for a
■ On the oil glut in the late 1960s, see Baldo C. Marinovic’s interview in the Global Accord,” New York Times, 29 January 1971. For a firsthand account, see
Regional Oral History Office collection. Leslie Lewis’s interview in the Saudi Aramco Oral History Project collection.
Notes on Sources Book sources for this chapter:

Al-‘Abbusi, Oil in the Arab States
■ On the effects of the 1973 Arab-Israeli War, see “Company Urges Review,”
New York Times, 19 September 1973. For the resulting oil embargo, see “Cut to
Barger, Out in the Blue Military Charged,” New York Times, 24 January 1974, and “Aramco Concedes
For complete information on book sources, see the bibliography, pp. 214-215.
Facey, et al., A Land Transformed Denying Oil to U.S. Military Since October,” New York Times, 2 January 1974.
Lacey, The Kingdom
■ On Saudization during the 1970s, see interviews with Hamed T. Al-Saadoun,
Lippman, Inside the Mirage
Sa‘ud A. Al-Ashgar and Ali I. Al-Naimi in the Aramco Resource Library. See also
Noring and LaFantasie, Foreign Relations of the United States, 1961–1963
Baldo C. Marinovic’s interview in the Regional Oral History Office collection and
Pakka, The Energy Within
“New Superintendents Appointed at Refinery,” Arabian Sun, 19 January 1977.
Pledge, Saudi Aramco and Its People
Stocking, Middle East Oil ■ On education trends in Saudi Arabia, see UNESCO’s statistics at http://stats.uis.
Symonds, Jebel Dhahran and the New Saudi Generation unesco.org/unesco/TableViewer/document.aspx? ReportId=121&IF_Language
Viola, Human Resources Development in Saudi Arabia =eng&BR_Country=6820.
Yergin, The Prize
■ On training for expatriates, see William Laney Littlejohn’s interview in the Saudi
sources of documentary information ■ On shifts in Saudi oil policy during the early 1960s, see “Saudi Oil Policy,” Aramco Oral History Project collection.
Middle East Economic Survey, 10 November 1961. For Ahmed Zaki Yamani’s
■ The Wallace Earle Stegner Collection, in the Special Collections of the Chapter 2 ■ On SRI’s participation in Saudi Arabian development, see SRI International’s
appointment as Minister of Petroleum and Mineral Resources, see “Chronicle
J. Willard Marriot Library at the University of Utah, Salt Lake City, Utah. boom time Web site at http://www.sri.com/about/timeline/timeline-flash.html.
of OPEC and Sheikh Zaki Yamani,” The Daily Star, 19 February 2004.
■ The White Collection, in the Chevron Corporate Archives, San Ramon, ■ On oil company name changes, see “Kelberer Assumes Board Chairman, ■ On the Master Gas System, see “Tuesday Seminar: Decisions in ARAMCO are
■ On the Sidon price claim, see “Aramco Comments on Sidon Claim,” Middle East
California. CEO Posts; Powers Elected Vice Chairman,” Arabian Sun, 4 January 1978; the 100% Saudi,” Ar-Riyadh, 26 January 1982.
Economic Survey, 28 July 1963; “Aramco and Tapline Agreements Ratified,”
ExxonMobil Web site at http://www.exxonmobil.com/Corporate/history/
■ The William E. Mulligan Papers and the Joseph A. Mahon Papers, in the Special Middle East Economic Survey, 5 April 1963; and “Aramco Back Payments ■ On housing for Aramco employees during the mid-1970s, see Arabian Sun,
about_who_history.aspx; the Chevron Web site at http://www.chevron.
Collections of the Lauinger Library at Georgetown University, Washington, D.C. and Economic Development,” Middle East Economic Survey, 19 July 1963. 12 January 1977; Arabian Sun, 31 August 1977; and Aramco 1977.
com/about/company_profile/; and the Texas State Historical Association
■ The Saudi Aramco Technical Information Center and the Saudi Aramco ■ On Aramco staff cuts in the late 1950s and early 1960s, see Aramco’s 1954, Web site at http://www.tshaonline.org/handbook/online/articles/doogz. ■ On Saudi contractors in the 1970s, see William E. Mulligan, “A Kingdom and a
Community Heritage Gallery, Dhahran, Saudi Arabia. 1959 and 1960 Report of Operations. On corresponding increases in revenue, Company,” Aramco World, May/June 1984.
■ On surging oil demand in the late 1960s, see Richard W. Powers’s
see “Oil Revenue From Aramco Reaches $895 Million for 1969,” Middle East
■ The Karl S. Twitchell Papers, in the Special Collections of the Seeley G. interview in the Regional Oral History Office collection; George L. Perry’s ■ On the NGL pipeline, see “Ceremony Marks First Shipment of Petroline Crude
Economic Survey, 10 April 1970.
Mudd Manuscript Library, Princeton University, Princeton, New Jersey. essay “The War on Terrorism, the World Oil Market and the US Economy” from Yanbu‘,” Arabian Sun, 8 July 1981.
■ On education in Saudi Arabia, see “Company-Built SAG School Program” at http://www.brookings.edu/views/papers/perry/20011024.htm; and
■ The Aramco Resource Library at The History Factory, Chantilly, Virginia. ■ On the growth of Saudi Arabia’s electrical grid in the 1970s, see “A Bright New
in the William E. Mulligan Papers, box 5, folder 14, and Abdallah S. Jum‘ah’s Aramco 1970 and Aramco 1971.
Era for Electrical Power,” Dimensions, Fall 2003, and “The Pillars,” Aramco
■ The Saudi Aramco Oral History Project at Aramco Services Company, interview in the Aramco Resource Library.
■ On Saudi Arabia’s role as swing producer, see Walter Dell’Oro’s interview World, November/December 1982. For a firsthand account, see Abdallah S.
Houston, Texas.
■ On Aramco’s employment of female Saudis, see Sadad Al-Husseini’s interview in the Saudi Aramco Oral History Project collection. Jum‘ah’s interview in the Aramco Resource Library. For a description of earlier
■ The Archives at the Hoover Institution on War, Revolution and Peace, in the Aramco Resource Library. electrical infrastructure, see Aramco 1978.
■ On the closure of Tapline, see Fred H. Drucker’s interview in the Saudi
Stanford University, Stanford, California.
■ On the College of Petroleum and Minerals, see the King Fahd University of Aramco Oral History Project collection. ■ On Abdallah S. Jum‘ah, see “Jum‘ah Named Senior Vice President; Saleh
■ The Regional Oral History Office collection, in the Bancroft Library, Petroleum and Minerals Web site at http://www.kfupm.edu.sa/kfupm/about/ Elected Vice President,” Arabian Sun, 20 July 1988, and “Dune Doings:
■ On Aramco’s rapid payroll expansion during the 1970s, see Aramco 1975
University of California, Berkeley, California. history.asp. See also Aramco 1970 and “Arabian American Oil Letters from Arabia 1958 to 1983” in the Aramco Resource Library.
and Aramco 1980. For a firsthand perspective, see also interviews
Company Donations, Contributions, and Assistance to Saudi Arabia
■ The George Rentz Collection in the King Abdul Aziz Public Library, Riyadh. with Abdulaziz F. Al-Khayyal and Mustafa Abuahmad in the Aramco Resource ■ On the 1977 Abqaiq fire, see Lawrence Tanner’s interview in the Saudi Aramco
1933–1970” in the William E. Mulligan Papers, box 5, folder 10.
Library and interviews with Robert Luttrell and Frank Fugate in the Saudi Oral History Project collection and an untitled Associated Press article dated
■ The National Archives, Washington, D.C.
■ On Aramco employee life during the 1960s and 1970s, see Khalid A. Al-Falih’s Aramco Oral History Project collection. 2 May 1977. For the resulting facilities improvements, see Dhaifallah A. F.
interview in the Aramco Resource Library and interviews with Frank W. Tracy Al-Utaibi’s interview in the Aramco Resource Library.
■ On concurrent growth in training programs, see “Ali M. Dialdin Retires from
and Lawrence Tanner in the Saudi Aramco Oral History Project collection.
Chapter 1 Training,” Arabian Sun, 25 November 1998. Book sources for this chapter:
For more information on Al-Falih, see also “Streaker Designated Senior VP;
national resources Bashshur, Higher Education in the Arab States
Falih Elected Vice President,” Arabian Sun, 25 November 1981, and “Board ■ On the construction of new ports, see “Saudi Arab Government Gas
Dajani and David, Economic Diplomacy
■ On Thomas C. Barger, see Paul F. Hoye, “Tom Barger: Myth or Man?” Aramco Appoints 6 to Vice Presidential Posts,” Arabian Sun, 16 May 2001. Program” in the William E. Mulligan Papers, box 5, folder 12, and “Shallow
Edens, Oil and Development in the Middle East
World, September/October 1969. On his strategy at Aramco, see “Planning Piers for New Cargo Offloading System,” Arabian Sun, 21 July 1976.
■ On Petromin, see Arthur Clark, “Saudi Aramco at Sixty,” Aramco World, Facey, et al., A Land Transformed
Guidelines for Aramco as a Corporation” in the Joseph A. Mahon Papers.
September/October 1993. ■ On the growing importance of project management, see Henry Barracano’s Han, Oil, The Persian Gulf States, and the United States
■ On Oil in the Arab States, see “Summary of the Oil in the Arab States” interview in the Saudi Aramco Oral History Project collection. Howarth, A Century in Oil
■ On relinquishment of portions of the concession, see Aramco 1963 and
at the Saudi Aramco Technical Information Center. Pledge, Saudi Aramco and Its People
“Obliging Goliath,” Time, 13 September 1963.
Sampson, The Seven Sisters
■ On oil price cuts in the late 1950s and early 1960s, see William E. Mulligan,
■ On the rise of Saudi government-run television, see “Channel 3 Television Yergin, The Prize
“A Kingdom and a Company,” Aramco World, May/June 1984, and “Esso
Bows Out Gracefully After 41 Years,” Arabian Sun, 30 December 1998.
Cuts Posted Price of Middle East Crude,” Middle East Economic Survey,
12 August 1960.
212 notes on sources notes on sources 213
Chapter 3 Chapter 4 ■ On Shaybah, see “Crown Prince Abdullah Inaugurates Shaybah Oilfield” ■ On other exploratory ventures, see Abdulkader M. Afifi and Ali Y. Al-Hauwaj’s
transformation rising to the challenge on the Royal Embassy of Saudi Arabia Web site, http://www. interview in the Aramco Resource Library and Saudi Aramco’s 2006 Annual
saudiembassy.net/archive/1999/news/page391.aspx. Review.
■ On Aramco’s 50TH anniversary, see “His Majesty King Fahd Honors Aramco ■ On the effect of the Gulf War on oil production, see U.S. Energy Information
at 50,” Arabian Sun, 18 May 1983, and “New Aramco President to be Administration statistics. For the effect on prices, see “Cash Prices” in the ■ On Saudi Aramco’s megaprojects, see John Palmer and Timir Mukherjee, ■ On oil blending at Qatif, see Saad A. Turaiki’s interview in the Aramco Resource
Saudi National, Yamani Says,” Platts Oilgram News, 18 May 1983. New York Times and the 1991 OPEC Annual Statistical Bulletin, table 71. For “MegaProjects,” Dimensions, Spring 2007. Library. For background on the Qatif field, see Simon Wardell, “Saudi Aramco
damage caused to oil facilities, see the U.N. Compensation Commission’s Aims to Exceed 11 Million bpd in Output Capacity by 2007,” World Markets
■ On training programs in the 1980s, see William E. Mulligan, “A Kingdom and a ■ On the Motiva joint venture, see PR Newswire, “ChevronTexaco Comments
2002 Report and Recommendations Made by the Panel of Commissioners Analysis, 7 May 2003.
Company,” Aramco World, May/June 1984. For a firsthand account, see on Announcement of Definitive Agreement for Sale of Former Texaco U.S.
Concerning Part Two of the Seventh Installment of “E1” Claims.
Abdullatif A. Al-Othman’s interview in the Aramco Resource Library. Downstream Interests,” 12 December 2001. ■ On Haradh-3, see “Quick Takes,” Oil & Gas Journal, 1 January 2001, and A. O.
■ On Saudi Aramco’s response to Gulf War oil shortages, see “Saudi Aramco Al-Kaabi, A. S. Muallem and N. G. Saleri, “Haradh III: A Milestone for Smart
■ On increases in oil revenues in the late 1970s, see Aramco 1980; Anthony J. Book sources for this chapter:
Details 1990 Surge in Oil Production,” Oil & Gas Journal, 12 August Fields,” Journal of Petroleum Technology, November 2006. See also
Parisi, “Price of Saudi Oil Reportedly Raised 8% to $26 A Barrel,” New York Facey, et al., A Land Transformed
1991; “Hisham Nazer Tours Aramco, Talks to Employees,” Arabian Sun, Saudi Aramco’s 2004 Annual Review. For a firsthand account, see Nansen G.
Times, 28 January 1980; and the U.S. Energy Information Administration’s Pakka, The Energy Within
5 September 1990; and Saudi Aramco 1990. For firsthand accounts, see Saleri’s interview in the Aramco Resource Library.
statistics at http://tonto.eia.doe.gov/dnav/pet/pet_pri_wco_k_w.htm.
Sadad Al-Husseini’s interview in the Aramco Resource Library and Bryan
■ On Khursaniyah, see Stephen L. Brundage, “Khursaniyah Rising,” Arabian Sun,
■ On Saudization and the growth of Aramco’s payroll in the early 1980s, see Bartlett’s interview in the Saudi Aramco Oral History Project collection.
Chapter 5 18 April 2007, and Ralph Bears’s speech “Saudi Aramco: Oil to a Thirsty
Aramco 1986 and “Al-Mishari Named General Manager, Oversees EXPEC
■ On the early 1990s Gulf oil spill, see “Oil Spills Continue to Threaten achieving the vision Market” on the World Energy Council Web site.
Computer Center,” Arabian Sun, 4 May 1988. For a firsthand account,
the Gulf,” Middle East Economic Survey, 11 February 1991; “Oil Spills
see Hesham Al-Musaiid’s interview in the Aramco Resource Library. ■ On Saudi Aramco’s early 2000s capital improvement program, see ■ On Khurais, see Rick Snedeker, “Mega2,” Dimensions, Winter 2006.
Sweep the Gulf,”Middle East Economic Survey, 4 February 1991; Thomas
“Saudi Mega Spend Is Fuzzy on Detail,” Petroleum Intelligence Weekly,
■ On Aramco’s female Saudi employees, see interviews with Samia Al-Edrisi, A. Pledge, “A War Within a War,” Saudi Aramco World, May/June 1991; ■ On Saudi Aramco’s growing number of oil rigs, see Lori Olson White, “The
16 May 2005, and “Saudi Arabia Plans Heavy Downstream Spend,
Nabilah Altunisi, Thuraya Al-Arrayed, Huda M. Al-Ghoson and Fatema H. Bennie H. Brown, “Al-Utaibi 42 Years on Board,” Arabian Sun, 28 January Big Push: Saudi Aramco Forging Ahead in Historic Production Expansion,”
Local Consultant Says,” International Oil Daily, 27 May 2005. See also
Al-Awami in the Aramco Resource Library. 2004; “Oil Slick Defenses Hold the Line Despite Rough Weather,” Arabian Dimensions, Fall 2006, and ‘Abd Allah S. Al-Saif’s interview in the Aramco
Saudi Aramco’s 2005, 2006, 2007 and 2008 Annual Review.
Sun, 13 February 1991; Abdulaziz M. Al-Hokail, interview by Liane Hansen, Resource Library.
■ On daily Aramco employee life in the 1980s, see James R. Tracy’s interview
Weekend All Things Considered, National Public Radio, 27 January 1991; ■ On booming oil demand in the 2000s, see BP p.l.c. and U.S. Energy
in the Saudi Aramco Oral History Project collection and Ali A. Al-Muhareb’s ■ On the expansion of Saudi Aramco’s refining capacity, see Abdulaziz F.
and “Oil Recovery Nears One Million Barrels,” Arabian Sun, June 1991. Information Administration statistics. See also Senate Committee on Energy
interview in the Aramco Resource Library. Al-Khayyal’s interview in the Aramco Resource Library and Jamal Kheiry, “Saudi
and Natural Resources, Short-Term Energy Outlook Summer 2007: Oil and
■ On Saudi Aramco’s investment in SsangYong, see Khalid G. Al-Buainain’s Aramco: The Leader,” Arab News, 6 December 2006. See also Ali I. Al-Naimi’s
■ On Aramco payroll reductions in the mid-1980s, see Seth L. Sharr’s interview in Gasoline, 110th Cong., 1st sess., 15 May 2007.
interview in the Aramco Resource Library. interview in the Aramco Resource Library and Saudi Aramco’s 2006
the Saudi Aramco Oral History Project collection and Khalid A. Al-Falih’s inter-
■ On Saudi Aramco’s reserves, see Saudi Aramco’s 2006 Annual Review. See Annual Review.
view in the Aramco Resource Library. For the reductions in oil demand behind ■ On Vela, see ”Two New Vela Tankers Named,” Arabian Sun, 22 September
also Abdallah S. Jum‘ah’s speech “State of the Oil and Gas Industry” at
the payroll cuts, see the U.S. Energy Information Administration’s statistics. 1993; “15 VLCCs on Order for Saudi Aramco,” Moneyclips, 30 June 1993; ■ On OSPAS, see Larry Seigel, “The Nerve Center,” Dimensions, Winter 2006,
http://www.saudi-us-relations.org/articles/2006/ioi/060613-jumah-speech.
and “A Year of Advancement,” Dimensions, Spring 1995. See also the Saudi and Saudi Aramco’s 2006 Annual Review.
■ On Aramco’s mothballing program in the 1980s, see Aramco 1985 and html, and Nabilah Altunisi’s speech “Saudi Aramco Mega Projects: Sustaining
Aramco publication “Vela International Marine Ltd.” in the Aramco Resource
Aramco 1987. See also “Saudi Aramco Details 1990 Surge in Oil Production,” a Stable Energy Supply to the World” on Saudi Aramco’s Web site. ■ On environmental issues, see “Saudi Aramco and the Environment,”
Library. For a firsthand account, see Dhaifallah A. F. Al-Utaibi’s interview in
Oil & Gas Journal, 12 August 1991; “Surprise: Drilling is Up,” World Oil, Dimensions, Spring/Summer 1998. For firsthand accounts, see interviews
the Aramco Resource Library. ■ On declining world oil supply, see the Web site of Cambridge Energy
August 1989; and “’Udhailiyah: In the Middle of Nowhere, Home,” with ‘Abd Allah S. Al-Saif and Abdallah S. Jum‘ah in the Aramco Resource
Research Associates, http://www.cera.com.
Dimensions, Summer 2005. For firsthand accounts, see interviews with ■ On the integration of Samarec into Saudi Aramco, see “Saudi Aramco’s Library. See also Saudi Aramco’s Web site.
Sadad Al-Husseini and Saad A. Turaiki in the Aramco Resource Library. Operations Dramatically Expanded,” Dimensions, Fall 1993; Abdul Aziz ■ On Saudi Aramco’s cultural change initiative in the 2000s, see Abdallah S.
■ On the Argus Sour Crude Index, see Javier Blas, “Saudis drop WTI oil contract,”
Al-Khamis, “Aramco’s $4b refinery projects get big boost,” MoneyClips, Jum‘ah’s interview at the Saudi Aramco Technical Information Center. See also
■ On the Master Gas System, see “GAO Team Reports Saudi Fields Healthy,” Financial Times, 28 October 2009.
16 June 1993; Mark Nicholson, “Survey of Saudi Arabia,” Financial Times, Saudi Aramco’s 2002 Annual Review and “Performance at Peak,” Arabian Sun,
Oil & Gas Journal, 20 March 1978, and Cook, “A Hard Choice: More
22 December 1993; and Saudi Aramco’s 1993 Annual Review. For a firsthand 22 May 2002. ■ On Saudi Aramco’s petrochemical initiatives, see Rick Snedeker, “And Now …
Recession—Or More Expensive Oil?,” Forbes, 20 March 1978.
account, see Khalid A. Al-Falih’s interview in the Aramco Resource Library. Something Completely Different: PetroRabigh,” Dimensions, Summer 2006,
■ On Saudi Aramco’s Research and Development Center, see Saudi Aramco’s
■ On the discovery of natural gas reservoirs, see Aramco’s 1957 Report and “Aramco’s Push For $26bn Ras Tanura Second Phase,” Gulf Daily News
■ On Saudi Aramco’s use of wastewater, see Kyle Pakka, “Turf’s Up,” 2000 Annual Review. See also Rick Snedeker and Lori Olson White, “R&D
of Operations, Aramco 1985, Aramco 1986 and Aramco 1987. See also (Bahrain), 5 June 2007.
Dimensions, Fall 2003. Center Expands,” Dimensions, Winter 2004, and Saad A. Turaiki’s interview
“After 18-Month Decline, Gas Crunch Forces Saudi Arabian Oil Flow
in the Aramco Resource Library. ■ On KAUST, see the KAUST Web site at http://www.kaust.edu.sa and
Higher,” Oil & Gas Journal, 10 October 1983. For a firsthand account, ■ On Ali I. Al-Naimi’s appointment as Minister of Petroleum and Mineral
“Saudi Arabia to Set Up SR10bn University of Technology,” Arab News,
see Sadad Al-Husseini’s interview in the Aramco Resource Library. Resources, see Al-Naimi’s interview in the Aramco Resource Library. On ■ On performance benchmarking, see John Palmer and Timir Mukherjee,
29 November 2006.
the resulting appointment of Abdallah S. Jum‘ah as president of Saudi “MegaProjects,” Dimensions, Spring 2007.
■ On oil pricing in the 1980s, see United Press International, “OPEC Slashes Oil
Aramco, see Jum‘ah’s interview in the Aramco Resource Library.
Production,” 2 March 1987; United Press International, “OPEC Accord Sets ■ On the expansion of the Master Gas System, see “Saudi Aramco
Book sources for this chapter:
Stage for Official Oil Price Hike,” 7 July 1987; and “Text of OPEC Agreement,” ■ On Saudi Aramco’s increased production in the 1990s, see U.S. Energy Khursaniyah Oil and Gas and Hawiyah NGL Recovery Programmes,
Facey, et al., A Land Transformed
Middle East Economic Survey, 27 December 1987. For a firsthand account, Information Administration and BP p.l.c. statistics. See also Interpress Saudi Arabia” at http://www.hydrocarbons-technology.com/projects/
see William Laney Littlejohn’s interview in the Saudi Aramco Oral History Service, “Gulf States Rein in Spending to Cut Deficits,” 28 December 1994, saudi-aramco/ and “Saudi Arabia—The Arab Light Producers—Ghawar
Project collection. and “Commodities Survey: November 1994,” Barclays Bank Commodities Group,” APS Review Gas Market Trends, 1 October 2007. See also Fahad
Survey, November 1994. For descriptions of specific discoveries, see Saudi A. Al-Khaldi, Saif D. Al-Qahtani and Basel F. Abu-Sharkh, “Improved
■ On Aramco’s growth in the late 1980s, see Saudi Aramco 1988.
Aramco’s 1991 and 1992 Annual Review and “Drillers Sink Offshore Design for the Haradh Gas Plant Energy System,” Saudi Aramco Journal
■ On the Ju‘aymah Gas Plant fire, see BBC, “Saudi Report on Fire at Natural Wells Using Horizontal Techniques,” Arabian Sun, June 1991. of Technology, Fall 2004, and “Aramco Forges Ahead with Own Gas
Gas Plant,” 17 August 1987, and Aramco 1987. For a firsthand account, Projects,” International Oil Daily, 23 October 2002. For a firsthand account,
■ On Saudi Aramco’s improved computer technology, see Rick Snedeker and
see Abdallah S. Jum‘ah‘s interview in the Aramco Resource Library. see Khalid A. Al-Falih’s interview in the Aramco Resource Library.
Jamal K. Dabal, “Growing IT,” Dimensions, Spring 2007, and Saudi Aramco’s
■ On Saudi Aramco’s vertical integration, see Saudi Aramco 1989. For a 2006 Annual Review. For a firsthand account, see Nansen G. Saleri’s interview ■ On Saudi Aramco’s joint ventures in natural gas exploration, see Rick
firsthand account, see Ali I. Al-Naimi’s interview in the Aramco Resource in the Aramco Resource Library. See also “Future of Global Oil Supply: Saudi Snedeker, “What Could be More Natural?,” Dimensions, Spring 2004, and
Library. Arabia” at http://www.saudi-us-relations.org/energy/saudi-energy-saleri.html. Mark Kennedy, “The New Explorers,” Dimensions, December 2006. See
also Saudi Aramco’s 2003 Annual Review. For working conditions, see
Book sources for this chapter: ■ For the extent of Saudi Arabia’s natural gas reserves, see U.S. Energy
UK Newsquest Regional Press, “Soldiers Will Have to Swelter in Temperatures
Ghosh, OPEC, the Petroleum Industry, and United States Energy Policy Information Administration statistics.
of 130F,” 10 October 2001, and Paul William Roberts, review of Sand Dance:
Marcel, Oil Titans
■ On recovery rates, see United Press International, “Undersea Channels Might By Camel Across Arabia’s Great Southern Desert, by Bruce Kirkby, The Globe
Pakka, The Energy Within
Aid Oil Recovery,” 22 May 2006, http://www.physorg.com/news67534124. and Mail, 17 June 2000.
Pledge, Saudi Aramco and Its People
html. See also Abdallah S. Jum‘ah’s speech “The Future of Global Energy:
Yergin, The Prize
Uncertainty Surrounding Global Energy Issues and Policies, and Its
Impact on Future Supply Expansion” on Saudi Aramco’s Web site.
214 bibliography bibliography 215
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216 Image credits Image credits 217
Image Credits
Volume Two Chapter Three Chapter Five Appendix

Transformation Achieving the Vision Downstream
Opening spread Shaikh M. Amin/Saudi Aramco; 68 Shaikh M. Amin/Saudi Opening spread Joseph Lynch; 132 Saudi Aramco; 134 Saudi Aramco; 135 Saudi 184 Faisal Al-Dossary/Saudi Aramco; 185 Joseph Lynch; 186 Courtesy
Front Matter
Aramco; 69 Saudi Aramco; 70 Shaikh M. Amin/Saudi Aramco; 71 Burnett H. Aramco; 136 Saudi Aramco; 137 Mohammed A. Al-Shihri/Saudi Aramco; 138 Ken of Robert Pollack/Still-Light.net; 187 (left) Pivot Design; 187 (right) Pivot
End papers Saudi Aramco; Title page Faisal I. Al-Dossary/Saudi Aramco; Moody/Saudi Aramco; 72 (top) Ian W. Bennett/Saudi Aramco; 72 (bottom) Childress; 139 (top) Stephen L. Brundage/Saudi Aramco; 139 (bottom) Courtesy Design; 188-189 Adrian G. Waine/Saudi Aramco; 190 Courtesy of Sabic;
ix Pivot Design. Shaikh M. Amin/Saudi Aramco; 73 Ali Abdullah Al-Khalifa/Saudi Aramco; 74 of Bobbi Lane; 140 Ali Mubarak/Saudi Aramco; 142 Joseph Lynch; 143 Ken 191 Courtesy of Vela; 192 Courtesy of Sinopec Senmei Petroleum Co;
Hussain A. Al-Ramadan/Saudi Aramco; 75 (top) Saudi Aramco; 75 (bottom) David Childress; 144 Ken Childress; 145 Saudi Aramco; 146 Saudi Aramco; 147 Stephen 193 Courtesy of Association of Petrochemicals Producers in Europe.
Lugo/Saudi Aramco; 76 Shaikh M. Amin/Saudi Aramco; 77 (top) Courtesy of L. Brundage/Saudi Aramco; 148-149 Faisal I. Al-Dossary/Saudi Aramco; 150 Saudi
Chapter One the Doha Debates, photo by Adrian Haddad; 77 (bottom) Stephen L. Brundage/ Aramco; 151 (top) Hasan M. Al-Taraiki/Saudi Aramco; 151 (bottom left) Stephen
National Resources Saudi Aramco; 78 Saudi Aramco; 79 Saudi Aramco Community Heritage Gallery; L. Brundage/Saudi Aramco; 151 (bottom right) Courtesy of Abu Abdulaziz Studio Appendix: Operations Data
80 STF/AFP/Getty Images; 81 Shaikh M. Amin/Saudi Aramco; 83 Abdullah Y. & Labs; 152 Hadi A. Al-Makayyl/Saudi Aramco; 154 Saudi Aramco; 155 Saudi
Opening spread Burnett H. Moody/Saudi Aramco; 2 Burnett H. Moody/Saudi 195, 196-197, 198-199, 200-201, 202-203 Pivot Design.
Al-Dobais/Saudi Aramco; 84-85 J. E. Champney/Saudi Aramco; 86 Shaikh M. Aramco; 156 Saudi Aramco; 157 (top) Courtesy of Showa Shell Sekiyu K.K.;
Aramco; 4 (top) Ahmed A. Al-Mentakh/Saudi Aramco; 4 (bottom) Courtesy
Amin/Saudi Aramco; 87 Shaikh M. Amin/Saudi Aramco; 88 (top) Saudi Aramco; 157 (bottom) Courtesy of Sinopec Senmei Petroleum Co.; 158 Saudi Aramco;
of OPEC; 5 Ahmed A. Al-Mentakh/Saudi Aramco; 6 Burnett H. Moody/Saudi
88 (bottom) Saudi Aramco; 89 Stephen L. Brundage/Saudi Aramco; 90 Shaikh M. 159 Saudi Aramco; 160 Saudi Aramco; 161 Moayed Al-Qattan/Saudi Aramco;
Aramco; 7 Burnett H. Moody/Saudi Aramco; 8-9 V. K. Antony/Saudi Aramco; Company CEOs
Amin/Saudi Aramco; 91 Shaikh M. Amin/Saudi Aramco; 92 Shaikh M. Amin/Saudi 162 Saudi Aramco; 164 Mahmoud A. Al-Hashem/Saudi Aramco; 165 Courtesy
10 V. K. Antony/Saudi Aramco; 11 Saudi Aramco; 12 (top) Pat K. Moody/
Aramco; 93 Saudi Aramco; 94 Saudi Aramco; 95 (top) Abdullah Y. Al-Dobais/ of Bobbi Lane; 166 Joseph Lynch; 167 Hasan M. Al-Taraiki/Saudi Aramco. Collier Saudi Aramco; Stoner Saudi Aramco; Rodgers Saudi Aramco;
Saudi Aramco; 12 (bottom) Saudi Aramco; 13 Saudi Aramco; 14 (top) Abdul
Saudi Aramco; 95 (bottom) Saudi Aramco World/SAWDIA; 97 Saudi Aramco. Davies Saudi Aramco; Hardy Burnett H. Moody/Saudi Aramco; Barger
Latif Yousif/Saudi Aramco; 14 (bottom) Burnett H. Moody/Saudi Aramco;
Burnett H. Moody/Saudi Aramco; Brougham Burnett H. Moody/Saudi Aramco;
15 Thomas F. Walters/Saudi Aramco; 16 Saudi Aramco; 17 V. K. Antony/
Appendix Hills Burnett H. Moody/Saudi Aramco; Jungers Saudi Aramco; Kelberer
Saudi Aramco; 18 (top) Saudi Aramco; 18 (bottom) Abdul Latif Yousif/Saudi
Chapter Four Upstream Burnett H. Moody/Saudi Aramco; Al-Naimi Abdullah Y. Al-Dobais/Saudi
Aramco; 19 Pivot Design; 20 Burnett H. Moody/Saudi Aramco; 21 Burnett
Rising to the Challenge Aramco; Jum‘ah Saudi Aramco; Al-Falih Salah A. Al-Alwan/Saudi Aramco.
H. Moody/Saudi Aramco; 22 (left) Saudi Aramco; 22 (right) Saudi Aramco; 168 Nazih F. Najjar/Saudi Aramco; 170 (left, right) Saudi Aramco; 171
23 Saudi Aramco; 24 Saudi Aramco; 25 Burnett H. Moody/Saudi Aramco. Opening spread Ken Childress; 100 Ken Childress; 102 Saudi Aramco; 103 Courtesy of Elizabeth C. Lacsamana and Keith W. Wallis; 172 Courtesy of C.
(top) Saudi Aramco; 103 (bottom) © Thierry Orban/Corbis; 104 (top) © Peter R. Scotese, PALEOMAP Project (www.scotese.com); 173 Pivot Design; 174
Turnley/Corbis; 104 (bottom) Ron Johnson/Saudi Aramco; 105 Ron Johnson/ Courtesy of Maverick Energy, Inc.; 175 Pivot Design; 176 (top) Courtesy of
Chapter Two Saudi Aramco; 106 Saudi Aramco; 107 (top) Courtesy of Showa Shell Sekiyu Christian Heine; 176 (bottom left, right) Geraint W. Hughes/Saudi Aramco;
Boom Time K.K.; 107 (bottom) Abdullah Y. Al-Dobais/Saudi Aramco; 108 (top) Abdullah Y. 177 (top) Hussain A. Al-Ramadan/Saudi Aramco; 177 (center) Robert F.
Al-Dobais/Saudi Aramco; 108 (bottom) Saudi Aramco; 109 Saudi Aramco; 110 Lindsay/Saudi Aramco; 177 (bottom left, right) Saudi Aramco; 178-179 Joseph
Opening spread Shaikh M. Amin/Saudi Aramco; 28 Shaikh M. Amin/Saudi
Abdullah Y. Al-Dobais/Saudi Aramco; 111 Saudi Aramco; 112 Courtesy of David Lynch; 180 M. Mercer/Saudi Aramco; 181 (top) Saudi Aramco; 181 (bottom)
Aramco; 29 Burnett H. Moody/Saudi Aramco; 30 Burnett H. Moody/Saudi
L. Ternes; 113 Stephen L. Brundage/Saudi Aramco; 114 Saudi Aramco; 115 Saudi Joseph Lynch; 182 (top) Joseph Lynch; 182 (bottom) Courtesy Department
Aramco; 31 Saudi Aramco; 32 Shaikh M. Amin/Saudi Aramco; 33 Thomas F.
Aramco; 116 Saudi Aramco; 117 Hussain A. Al-Ramadan /Saudi Aramco; 118 of Physics and Technology, University of Bergen; 183 Pivot Design.
Walters/Saudi Aramco; 34 Shaikh M. Amin/Saudi Aramco; 35 Geoff R. Hunter/
Adrian G. Waine/Saudi Aramco; 119 Faisal I. Al-Dossary/Saudi Aramco; 120 Faisal
Saudi Aramco; 36 Burnett H. Moody/Saudi Aramco; 37 (top) Saudi Aramco;
I. Al-Dossary/Saudi Aramco; 121 Stephen L. Brundage/Saudi Aramco; 122-123
37 (bottom) Ali Mohammed Al-Khalifa/Saudi Aramco; 38 © Corbis; 39 Geoff
Ken Childress; 124 [SHELL STATION]; 125 Abdullah Y. Al-Dobais/Saudi Aramco;
R. Hunter/Saudi Aramco; 40 © Corbis; 43 © Owen Franken/Corbis; 44 Shaikh
126-127 Adrian G. Waine/Saudi Aramco; 128 Saudi Aramco; 129 Ken Childress.
M. Amin/Saudi Aramco; 45 (top) Pat K. Moody/Saudi Aramco; 45 (bottom) Pat
K. Moody/Saudi Aramco; 46 Burnett H. Moody/Saudi Aramco; 47 Burnett H.
Moody/Saudi Aramco; 49 Shaikh M. Amin/Saudi Aramco; 50 Saudi Aramco; 51
Geoff R. Hunter/Saudi Aramco; 52 Dorothy Miller/Saudi Aramco; 53 Shaikh M.
Amin/Saudi Aramco; 54 (top) Saudi Aramco; 54 (bottom) Shaikh M. Amin/Saudi
Aramco; 55 Saudi Aramco; 56-57 Michael J. Isaac/Saudi Aramco; 58 Shaikh M.
Amin/Saudi Aramco; 59 Courtesy of Samia Al-Idrisi; 60-61 Geoff R. Hunter/Saudi
Aramco; 63 Saudi Aramco; 64 Saudi Aramco; 65 Shaikh M. Amin/Saudi Aramco.
index 219
Index
Page numbers in blue indicate Energy to the World, The Story of Saudi Aramco
Volume One. Page numbers in red indicate Energy to the World, The Story
of Saudi Aramco Volume Two. Page numbers in bold indicate charts, italics
indicate photographs, and page numbers followed by “n” indicate notes.
A Ahmad, Sa‘id, 151, 151

Abadan, 18, 20, 163 ‘Ain Dar, 144, 144, 145, 145, 146, 154, 200, 200, 31, 49
Al-Abbad, Ali, 132, 132 ‘Ain Dar Gas Injection Plant, 210, 210
Al-‘Abbusi, Muhammad Jawad, 5 air conditioning, 48, 83, 86, 133, 159, 168
Al-Abdulwahed, Khalid, 155, 155 air quality, 158
‘Abd al-‘Aziz (King). See Al Sa‘ud, ‘Abd al-‘Aziz ibn ‘Abd al-Rahman (King) air raid shelters, 107, 107
‘Abd al-Aziz, Faysal, 6 Al-Ajaji, Abdulaziz Omer, 178, 128
Abd Allah. See Philby, Harry St. John Bridger (“Abd Allah”) Al-Ajam, Saleh A., 9, 9
‘Abd Allah, Rashid ibn, 143, 143 Ajmi, Nassir M., 13, 172, 47, 47, 92, 102, 108, 111
Abdel Mohsin, Sami A, 137 Alaska, 106, 23, 79, 80, 134
Abdulqadir, Abdulrahman M., 136 El ‘Alat Dome, 73
Al-‘Abid, ‘Abdal ‘Aziz, 11, 11, 47, 47 Aleppo College, Syria, 192
Abqaiq, xii, 73, 81, 101, 105, 106, 109, 110–111, 116, 128, 136, 137, Alexander, T. C., 113, 179, 179
142, 143, 143, 144, 146, 162, 162, 168, 169, 171, 179, 180, 16, Alexandria, Egypt, 69
20, 27–28, 28, 49, 52, 62, 63, 64, 64, 72, 87, 89, 89, 120, 125 Algemeene Exploratie Maatschappij, N. V., 47, 47
downstream operations, 190 Algeria, 41
fire at, 63, 64, 64 ‘Ali, ‘Abd Allah, 6
upstream operations, 182 al-‘Ali, Khidr, 64, 64
Abqaiq Mechanical Shop, 102, 102 Al-Ali, Mohammed Saeed Salman, 102
Abuahmad, Mustafa, 21, 33, 46 Al-Ali, Muhammad Sa‘id, 11, 11
Abuahmad, Mustafa Al-Khan, 190, 190, 212, 213, 213 Al-Ali, Mustafa Naser, 146, 146
Abu ‘Ali, 81 ‘Ali al-Kaylani, Rashid, 97
Abu al-Naft. See Holmes, Frank “Abu al-Naft, Father of Petroleum” (Major) ‘Ali al-Khajah, ‘Abd Allah Haji, 149, 149
Abu Dhabi, 206, 41 Ali Alturki, Khalid, 47, 47
Abu Hadriya, 14, 14, 88, 105–126, 109, 147 alkylamine, 183
Abu Hijlah, Omar, 159, 159 alliances, building, 129–131
Abu Jifan, 113, 150 Allies (World War II), 119, 121, 125
Abu Khadrah, Najati, 190, 190 Allman-Ward, Patrick, 141
Abu Nahyah, Hamad, 168, 168 “All the King‘s Oil” (Marquis), 55
Aburqubah, ‘Ali Dakheel, 11, 11 Almana, Muhammad, 181
Abu Sa‘fah, 16, 17, 17, 82 Alomair, Aysha and Deema, 152, 152
Abyssinia, 37 Alphard Star (tanker), 83
acid gas, 183 Alqurashi, May, 165
acritarchs, 170, 170 Altair Star (tanker), 108
Aden, 111, 10 Altarf (tanker), 155
Advanced Degree Program, 146 Alter, Harry, 149
Advanced Fire Training Center, 142, 142 alternative energy sources, 161
Advanced Industrial Training Center, 172 Altowelli, Khalid F., 158
aerial reconnaissance, 68–73 Altunisi, Nabilah M., 75, 75, 77
Al-‘Afaleq, Ibrahim A., 47, 47 Aluminum Products Co. (ALUPCO), 51, 51
Afifi, Abdulkader, 156 Ambah, Saleh, 14
Aframax-class vessels, 155 AMDP-2 (Aramco Mobile Drilling Platform 2), 2, 2
agreement in al-‘Uqayr, 14–16, 35, 42, 43 America. See United States of America (USA)
agriculture. See farming American Association of Petroleum Geologists (AAPG), 146, 147
A-group students, 46 American Independent Oil Co. (Aminoil), 138, 201
220 index index 221
American Petroleum Institute (API), 27, 74 Aramco Mobile Drilling Platform 2 (AMDP-2), 2, 2 Barger, Thomas C., 67, 67, 84–85, 84, 87, 102, 104, 104, 105, 127, Bunyan, Marilyn, 169, 169
American University, Washington, D.C. (USA), 77 “Aramcons,” xi–xii, 150, 170, 170, 15, 15, 16, 160, 160. See also Arabian 137, 148, 150, 172, 210, 210, 3, 6, 6, 16, 20, 21, 21, 24, 24 Buqqah, 143, 143
American University in Cairo, 59 American Oil Co. (Aramco); Saudi Arabian Oil Co. (Saudi Aramco) company leadership, 204, 205 Buraimi Oasis, 206, 206
American University of Beirut (AUB), 98, 176, 192, 192, 211, 212, 212 visited by King ‘Abd al-‘Aziz, 160, 161, 161, 207 ”Planning Guides for Aramco as a Corporation,” 3, 6, 24 Burchfiel, Hugh L., 63, 63, 64, 69, 70
Amoco, 125 visited by King ‘Abd Allah, 165–166, 167, 167 Barger, Tim, 87 Burgan, 23, 126
Amouzegar, Jamshid, 39 visited by King Sa‘ud, 207, 207 Barracano, Henry “Hank,” 35 Burleigh, William, 106, 108, 148
Al-Anaysha, Abdullah Yusuf, 99, 101 Aramco Overseas Co. (AOC, Aramco Purchasing Co.), 193, 193, 153 Barran, David, 40 Burmah Oil, 18
Al-Anaysha, Ibrahim, 101 Aramco Services Co., 124, 124, 158 Bartlett, Bryan, 103, 112 Busbayte, ‘Abd Allah S., 190, 190, 212, 213, 213
Anderson, Floyd, 80 Aramco World, 15. See also Saudi Aramco World “basement rocks,” 75 butadiene, 192
Anglo-Iranian Oil Co., 47, 47, 168, 197, 201, 202 Argus Sour crude Index, 162 “basket” of prices, 89 butane, 190, 192. See also Natural Gas Liquids (NGLs)
Anglo-Persian Oil Co., Ltd., 15, 16, 17, 18, 19, 20, 21, 26, 47, 50 Aridi, Mohamed, 113 Basra, 16, 69 Butler, Joyce, 169, 169
Anglo-Saudi Treaty of 1915 (Darin or Qatif Treaty), 6 Arizona State University (USA), 71, 71 Basrawi, Fahmi, 156, 172, 176, 177, 212, 212 “buyer’s market for oil is over,” 38–40
anhydrite, 79, 79, 82 Arnot, Anne, 171 Al-Bassam, Faysal M., 46, 46, 72, 72
Animal Farm, 113, 115, 115 Arnot, Elizabeth, 165, 165, 171 Al-Bassam, Nabil I., 111 C
Annual Arab-U.S. Policymakers Conference, 160 Arnot, Paul, 100, 109, 111, 143, 171, 21, 21 Bataweel, Omar, 11, 11 Cadman, Sir John, 15, 26–27, 47, 48
Anthony, John Duke, 72, 72 aromatics, 187, 192, 193, 193 Baty, Harvey, 212, 212 Cairo, 40, 69, 127, 196
anticline traps, 174, 174 Al-Arrayed, Thuraya, 77, 77 Bechtel-McCone-Parsons, 115, 116, 132–133, 134, 136, 182, 183 Calgary, Canada, 23
Antioch College, Ohio (USA), 212 art contest, children’s, 94, 94 Bedouin. See also guides (Bedouin), 5, 13–14, 14, 15, 15, 17, 39, 55, 68, California (USA), 23, 26, 41, 182
Antonius, George, 37 Al-As‘ad, Saleh, 146, 146 70, 72, 112, 113, 134, 136, 136, 144, 144, 148, 148, 150, 150, 179 California Arabian Standard Oil Co. (Casoc), 9, 63–66, 68, 69, 71, 72, 73, 76,
AOC (Aramco Overseas Co., Aramco Purchasing Co.), 193, 193, 153 Ashary, Assem (Captain), 108, 108 relators, 148, 148, 149 77, 78, 79, 80, 84, 88, 89, 90, 95–96, 96, 97, 97, 98, 101, 104, 109, 110,
API (American Petroleum Institute), 27, 74 Al-Ashgar, Sa‘ud Abdulrahman, 72, 72 Beijing, 153 111, 113, 116, 118, 118, 179, 182, 183, 195, 136. See also Arabian
APP (Associate Professional Program), 73 ‘Ashoor, Saif Al-Deen, 148 Beirut, 33, 71, 163, 192, 199, 7 American Oil Co. (Aramco)
Apprenticeship Program for Non-Employees, 135, 135 Asia, 203, 134–135, 153, 161 Beit Meri, 41 facilities visited by King ‘Abd al-‘Aziz, 88, 88
Aqil, Hullayil, 8, 8 Asker, Mohammad N., 145, 145 Bell, Gertrude, 3 name change, 55, 101, 113, 115, 118, 118, 205
Arab Congress in Paris (1913), 12 asphalt seeps, 18, 26 benzene, 192, 193, 193 California Texas Oil Co., Ltd. (Caltex), 79
Arabian American Little League, 138 associated gas, 144, 147, 183 Berg, Ernie, 102, 103, 104, 104 Cambrian Period, 172
Arabian American Oil Co. (Aramco), 55, 94, 101, 102, 107, 111, 113, 115, 116, Associate Professional Program (APP), 73 Berg, W. H., 41 Cambridge, 145
117, 118, 120, 3–4, 5, 6, 7, 10, 10, 11, 13, 16, 20, 21, 22, 23, 24, 29, 30, Al-Atasi, Hashem, 191 Berri, 16, 37, 37, 81, 87, 114, 143, 158 Cambridge Energy Research Associated (CERA), 135
31, 32, 33, 34, 34, 36, 38, 39, 41, 42, 44, 46, 49, 50, 51, 52, 53, 54, 59, 60, Al-Atiq, Muhammad, 64, 64 downstream operations, 190 Campbell, William S. “Sandy,” 191, 193
62, 63, 64, 69, 70, 71, 72, 75, 77, 78, 82, 83, 88, 89, 205. See also Atlantic Refining Co., 22 operations data, 199, 199 Canada, 23, 126, 138, 104
“Aramcons”; California Arabian Standard Oil Co. (Casoc), Chevron, Australia, 6, 18, 113, 138, 193 B-group students, 46 Cantrell, Dave, 76, 117
Saudi Arabian Oil Co. (Saudi Aramco); Standard Oil Co. of automobiles, 19, 19, 23, 126, 40, 40, 158 “Big Board” in Operations Coordination Center (OCC), 154, 154, 184, 184 capacity concerns, 143
California (Socal), Standard Oil Co. of New York (Socony); Standard Avinoil Industrial Commercial and Maritime Oil Co., S. A., 107 Big Oil Man from Arabia (Cheney), 133 Cape of Good Hope, 205, 33
Oil of New Jersey (Jersey, Exxon), The Texas Company (Texaco) Al-Awami, Amal A., 115, 115 Al-Bilad, 198, 7 capital program, 30, 133, 141, 143, 150, 150–151, 152
annual oil production, 198 Al-Awami, Fatema H., 77, 77 Biltagi, Bader, 194, 196 cap rocks, 174
Aramco world for Saudis, 14–16 ‘Awny, Muhammad Husain, 185 biotechnology, 139, 139 Caravan, The (Al-Qafilah), 158
board of directors, Saudis named to, 210, 211, 211 Al-‘Awwami, Haider, 74 Biotopes of the Western Arabian Gulf: Marine Life carbonate geologists, 177
headquarters move to Dhahran, 202, 202, 210 Al-‘Awwami, Ni‘mah S. M., 47, 47 and Environment of Saudi Arabia, 157 carbonates, 82
logo, 136, 136 Axis Powers (World War II), 95, 97, 99, 99, 101, 108, 113, 116 Birds of the Eastern Province of Saudi Arabia, 157 carbon capture and sequestration, 158
name change, 92–93, 95, 205 Al-Ayyam Al-Jamilah, 100 Bi‘r Shubat, 43, 43 carbon dioxide, 183
Saudi government, frayed relationship, 162–163, 165, 168 Al-‘Aziz, ‘Abd, 181 Bitter Lake, 120 carbon management, 158
Saudi ownership of, 156, 177, 29, 40–41, 45–46, 64, 69, 159 Al-Aziz, Muhammad ibn ‘Abd, 186, 186 “Black” Monday (USA stock market crash), 37, 37 Carpenter, Nellie, 83
social responsibility evolution, 164 al-‘Aziziyah, 160 blending crude oil grades (Qatif), 142, 143, 143, 144, 144, 190 Case, Paul, 213, 213
Arabian Gulf, 18, 75, 102, 122, 122, 206, 33, 41, 103–104, 103, 104, 105, 157 Azerbaijan, 20, 21, 21, 23 board of directors, Saudis named to Aramco, 210, 211, 211 Casoc. See California Arabian Standard Oil Co.
downstream operations, 185, 191 ‘Aziz, Zaid Abdul, 9, 9 bombing of Dhahran by Italy, 106, 106, 107, 107, 108, 109 Caspian Sea, 21
upstream operations, 182 Book of Khalid (Rihani), 12 catalytic cracking, refining process, 188
Arabian Heavy crude oil, 40 B Borneo, 23 catalytic reforming, refining process, 188
Arabian Light crude oil, 40, 42, 44, 52, 70, 89, 103, 142, 144, 147, 177 Baba Gurgur, 22, 23 boys school (Arab Preparatory School, Jabal School for Boys), 113, 138, 153, CAT (computer-aided tomography) scans, 116
Arabian Nights, The (fable), 135 bacteria to remove sulfur, 139, 139 155, 156, 156, 168, 168, 172–173, 175, 177 CDPNE (College Degree Program for Non-Employees), 111, 111
Arabian Peninsula, 75, 131, 173 Badanah, 134, 134 BP. See British Petroleum Center for Remote Sensing at Boston University (USA), 145
Arabian Research Division, 148, 149, 150 Badghaish, Usama, 147 Bramkamp, Richard A., 104, 133, 137, 146 Central Ghawar Well Services Division, 137
Arabian Shelf, 75, 81, 173 Baghdad, 18, 21, 40, 69, 177, 5 Brent Weighted Average price for North Sea oil, 89 Central Province, 127
Arabian Shield, 75 al-Bahah, 43, 43, 178 Bretton Woods, New Hampshire (USA), 193 CERA (Cambridge Energy Research Associated), 135
Arabian Sun, The, 55 Bahrabi, Bassam H., 151, 151 Brewster Committee (U.S. Senate committee), 162 Chamberlin, Edith, 169
Arabian Sun and Flare, 136 Bahrain, 7, 9, 12, 16, 22, 23, 24–25, 26, 27, 28–29, 31, 31, 35, 39, 41, British Admiralty’s Hydrographic Department, 90 Cheney, Michael Sheldon, 133
Arabian Super Light crude oil, 96, 177 42, 43, 46, 46, 47, 47, 48, 49, 50, 61, 62, 62, 63, 64, 69, 72, 73, British government, 3–4, 6, 8, 8, 14, 15, 16, 19, 20, 21, 26, 28–29, 42, 48, 49, Chevron (Standard Oil of California), 29, 41, 124, 158.
Arab Industrial Development, 149, 181 76, 78, 79, 80, 80, 84, 90, 108, 133, 138, 143, 169, 182, 87 50, 52, 55, 96, 97, 112, 119, 130, 204, 205, 206 See also Arabian American Oil Co. (Aramco)
Arab-Israeli tensions, 20, 22, 42–43 Bahrain Petroleum Co. (Bapco), 29, 30, 30, 31, 31, 39, 41, 48, 48, 73, British Oil Development Co., 47, 47 Chevron Geophysical, 68
Arab-Israeli War of 1948, 132, 142, 199 76, 78–79, 90, 108, 143, 162, 169, 182, 183 British Petroleum (BP), 4, 5, 39, 41, 45, 104, 125 children’s art contest, 94, 94
Arab-Israeli War of 1967, 205 Bahrain Pipeline, 185 Brougham, Robert I., 7, 7, 20, 24, 204, 205 Childs, J. Rives, 196
Arab-Israeli War of 1973, 29 Bait al-Americani, 97, 97 Brown, Art B., 63, 63 Childs, Marquis, 55
Arab League, 196 Bait al-Baghdadi, 97, 97 Brown, Edna, 83 China, 40, 78, 134, 141, 143, 153, 156, 156, 157, 160
Arab Oil Congress in Cairo, 4 Bait al-Sha‘r (house of hair), 13 Brown, Ron, 169, 169 downstream operations, 189
Arab Petroleum Congress, 5. See also Organization Baku, 20, 21, 21, 23 Brown University in Providence (USA), 13 chronometers, 66
of Petroleum Exporting Countries (OPEC) Baljurashi, 178 Brunton compasses, 66 Churchill, Winston, 19, 20, 119, 136
Arab Preparatory School (Jabal School for Boys), 113, 138, Al-Baluchi, Ali, 172, 185, 185, 46 Al-Buainain, Khalid G., 107, 156, 156 Clark, Henry, 106
153, 155, 156, 156, 168, 168, 172–173, 175, 177 Banban, 57 Bubshait, ‘Abd Al-Qader, 212, 212 cleaner-burning fuels, 158
Arab Revolt against the Turks in 1916, 6 Bapco. See Bahrain Petroleum Co. Al-Bubshait, ‘Abd al-Rahman, 47, 47 clerical training, 59, 59
Arab Zone, 89, 105, 87 barastis, 9, 77, 78, 78, 111, 113 Bucknell University, Pennsylvania (USA), 212, 213 climate change, 158
Arab Zones A-D, 144, 146 Barge 136 Queen Mary, 37, 37 Buday, ‘Abd Al-Aziz ibn Ahmad, 176, 176 coal, 126
Aramco. See Arabian American Oil Co. Barger, Kathleen, 84, 104 Bukhara, 40 coins, first official, 195
222 index index 223
coking, refining process, 187 Davies, Fred A., 29, 29, 30, 31, 43, 49, 62, 73, 78, 80, 81, 106, 142, 197, 201, 36 Doyle, Pat, 86, 86 ENI, 141, 147
Cold War, 171, 186, 193 company leadership, 204, 205 Dreyfus, Felix W., 63, 63, 64, 71 EniRepSa Gas Limited, 141
College Degree Program for Non-Employees (CDPNE), 111, 111 Davis, Edmond, 48 drill cuttings, 170, 176 En Nala (al-Na‘lah), 72, 73
College Fast Track Program, 71–72 al-Dawasir tribe, 9 drillers (Saudi), 101, 102, 102, 154, 154 En Nala hypothesis, 144–146, 145. See also Ghawar
College of American Pathologists, 151 Al-Deen, Mustafa Husam, 148 drilling and reservoir engineering, 180–181 entrepreneurial Saudis, 107, 147, 147, 149, 149, 155, 181, 181, 182, 182, 183,
College of Arabic Language, 173 de-ethanizer columns, 190 Drilling and Workover, 151, 151 183, 184, 50, 50–51, 51, 53, 125, 147, 163
College of Arts in Baghdad, 5 Delaware City, Delaware (USA), 95, 124 drilling wells, 180, 180 environment, caring for the, 157–159
College of Petroleum and Minerals (University of Petroleum Delft University of Technology, 146, 146 drillpipe, 39, 39 Eocene Period, 75, 75, 81, 103, 106
and Minerals, King Fahd University of Petroleum and delineation wells, 180 Drucker, Fred H., 134, 21 ERC (extreme reservoir contact) wells, 145, 145, 181
Minerals), 173, 173, 179, 13–14, 20, 48, 72, 72, 74, 142, 157 Dell’Oro, Walter, 136, 31–32 Duba, 186 Eritrea, 116, 119, 120
College of Shari‘ah (Umm al-Qura University, Makkah), 173 demand for oil. See supply and demand Dubai, 108, 155 Erspamer, Mike, 105, 106
College Preparatory Program, 152 de-mothballing production facilities, 102, 102 Dubai and Oman, 89 El Segundo (tanker), 69
Collier, Harry D., 204, 205 Denmark, 108 Duce, James Terry, 143, 177 Es Safa, 70
Colorado School of Mines (USA), 111 depentanizer columns, 190 Al Dughither, Sahar A., 165, 165 Esso Libya, 42
Common Brothers, 36 desalting process, 182 Dukhan, 23 ethane, 190, 192, 199
Comodoro Rivadavia, Argentina, 23 Deutsche Bank, 40 Dunbar, G. C., 192, 192 ethylene, 163, 192, 193, 193
Compagnie Française des Pétroles, 21, 130 Devonian Period, 172 Dust Rag, The, 158 Euramerica supercontinent, 172
company leadership, Saudi Aramco, 111, 204–205 Dhahran, 42, 42, 58, 58, 66, 66, 75, 76, 77, 78, 78, 81, 83, 86, 88, 88, 89, 90, 95, Al-Duwaihi, ‘Abd Al-Rahman, 151, 151 Europe, 126, 127, 130, 130, 131, 193, 107,161
compasses, 66, 83 100, 101, 101, 102, 104, 105, 106, 106, 107, 107, 108, 109, 111, 113, 116, Event Solution Center, 77
computer-aided tomography (CAT) scans, 116 119, 119, 125, 126, 126, 127, 129, 132, 133, 136, 137, 137, 138, 142, 148, E executive positions of Saudis, 48
Computing Technology, 74 149, 152, 152, 159, 159, 160, 162, 163, 164, 165, 165, 166, 166–167, 168, Earth’s interior, 172 expatriate workforce, 156, 157, 157, 160, 164, 164, 165, 165, 168, 169, 169, 171,
concessions for Middle Eastern oil, 47, 47, 95, 98, 104, 127, 68, 69, 205 169, 171, 172, 173, 174, 175, 175, 176, 177, 180, 184, 185, 192, 192, 193, East Africa, 116, 119, 120 15, 15–16, 48, 52, 52, 64, 77, 78, 79, 79, 81, 101, 128, 202–203.
condensate (liquid hydrocarbons), 157, 183 194, 203, 203, 207, 207, 213, 5, 5, 13, 20, 20–23, 24, 24, 30, 30, 48, 78, 78, Easter Egg Row (Gazelle Circle), 127 See also workforce
Consolidated Contractors Co., 146 102, 103, 109, 109, 125, 125, 127, 165 Eastern and General Syndicate, 4, 14, 16, 17, 26, 27, 28, 35, 42, 43, 46, 47, 47, 48 EXPEC (Exploration and Petroleum Engineering Center), 69, 69, 74, 74, 75, 76,
consolidation of territories by King ‘Abd al-‘Aziz, 3–4, 5, 14, 120 Dhahran Ahliyyah School, 94 Eastern Gulf Oil Co., 26, 47, 47 76, 77, 115, 115, 170, 170
Constantinople College for Girls, 40 Dhahran Industrial Center, 135, 135 Eastern Province, 6, 10, 11, 13, 14, 18, 20, 29, 33, 48, 52, 54, EXPEC-ARC (Exploration and Petroleum Engineering Center-Advanced
construction surge, 30, 32, 34–35, 36, 50, 52–53, 78, 82, 83, 92, Dhour El Choueir, 71 58, 60, 61, 77, 105, 106, 112, 156, 165. See also Al-Hasa Research Center), 116, 117, 145, 145–146, 180
96, 101, 120, 125, 126, 133, 137, 140, 143, 144, 144, 146, 147 dhows, 9, 12, 62, 77 oil and gas fields of, 175 Exploration, 150, 156
Consulting Services, 109 Dialdin, Ali, 34, 46 stratigraphy of, 173 exploration, 16–19, 68, 68, 95–96
Convent, Louisiana (USA), 95 Dialdin, Hiba A., 145, 145 East Texas (USA), 23 upstream operations, 176
conversion processes, refining process, 187 Dickson, H.R.P. (Colonel), 36 East-West Crude Oil and NGL Pipeline, 56–57, 57, 66, 66, 90, 90, 91, 102 Exploration and Petroleum Engineering Center (EXPEC), 69, 69, 74, 74,
Cooper, Nan, 169, 169 diesel, 187, 187 downstream operations, 185 75, 76, 76, 77, 115, 115, 170, 170
Core Lab, 177, 177 Al-Din, Ibrahim Nur, 185 Echezuria, Patti, 106, 106 Exploration and Petroleum Engineering Center-Advanced Research Center
core samples, 170, 176, 177, 177 dirahs, 15 Echezuria, Ralph, 48 (EXPEC-ARC), 116, 117, 145, 145–146, 180
Core Store (Well Samples and Laboratory Unit), 117, 117 al-Dir‘iyah, 7 Economic Diplomacy: Embargo Leverage and World Politics Exploration & Producing (E&P), 114, 119, 144, 159
Corporate Planning, 168, 77, 78 directional drilling, 180 (Daoudi and Dajani), 42 Exploration & Producing Management Forum, 151, 151
Cox, Sir Percy, 3–4, 4, 6, 9, 14 Directorate of Education, 173 economic downturn, 13, 24, 29, 35, 36, 37, 37, 40, 41, 44, 52, 54–55, 89, 138 exploration support caravan, 188, 188
Crane, Charles R., 36, 37, 39, 40, 40 disabling injury rate, 197 war years (World War II), 120 Exploration Technical Services, 156
Cretaceous Period, 41, 173, 173 Discovery! (Stegner), 100 Eddy, William A. (Colonel), 94, 94, 127 extreme reservoir contact (ERC) wells, 145, 145, 181
Crew, Bob, 64, 64 “Discovery of the Ghawar Field” (Keith), 146 Edh Duraiya, 73 Exxon. See Standard Oil of New Jersey
cross-cultural relationships (Saudi and Western), 148–150, distillation column, refining process, 187 Al-Edrisi, Samia, 59, 59, 75 ExxonMobil, 153, 188
151, 151, 156–157, 171, 77–78, 166 distillation units, 125 Education and Arab Training, 176 Exxon Valdez (tanker), 106
crude oil classifications, 39, 152, 162 distribution, downstream operations, 191 education and training, 10–14, 39, 128, 128, 147, 155, 156, 168, 168–170,
currency complications, 193, 193, 195, 210 diversification and downstream operations, 93, 95, 107 171, 171, 172–179, 184, 190, 190, 192, 192, 193, 211–213, 212, 213, 46, F
Curry, J. M., 7, 7 Doha Debates in Qatar in 2009, 77 47, 47, 51, 59, 59, 63, 63, 64, 70, 72–73, 75, 75, 110, 110, 111, 111, 113, F. A. Davies (storage vessel), 36, 36
Cushing, Oklahoma (USA), 162 Domercq, John, 108, 108 135, 135, 151, 151–152, 152, 163–166. See also girls’ education; Fadhili, 147
domestic integration, 108–109 scholarships; specific schools and universities. Fairchild 71, 68–69, 69, 70, 70–71
D domestic operations map, 195 Egypt, 36, 39, 193, 203, 204, 20, 22, 42, 43, 44, 137 Al-Faisal, ‘Abd Allah, 47, 47
D. G. Scofield (tanker), 90, 91, 98, 185 dormitory housing, 159, 165, 171, 159 war years (World War II), 97, 116 Al-Faleh, Saleh, 11, 11
Daggy, Richard, 179 Al-Dosari, ‘Abd al-Rahman, 172 ‘Eid, Khalifah, 172 Al-Falih, ‘Abd Al-‘Aziz, 47, 47
Dahl Hit, 79, 79, 81–82 Al-Dosari, Ahmad, 172 Eisenhower, Dwight D. (U.S. President), 204 Al-Falih, Abdulaziz D., 14
Dahna sands, 39, 56 Al-Dosari, Sulaiman, 172 Eisler, Bill, 100 Al-Falih, Khalid A., 14, 81, 92, 109, 110, 133, 141, 153, 160, 161, 161, 204, 205
Dajani, M. S., 42 Al-Dossari, Abdullah, 155, 155 e-Learning courses, 136 family members at oil camps, 83, 83, 108, 163, 164, 164, 165, 165, 171
Damascus, 6, 8, 8, 191 Al-Dossary, Fahd, 64, 64 electrical power, 29, 54, 58, 60–62 Faraj, Ibrahim, 174, 174
Dammam area, 12, 137, 174, 179, 181, 183, 14, 51 Al-Dossary, Mubarak N., 115, 115 electricity experiments, 192, 192 Farasan Islands, 16, 79
Dammam Dome, 17, 23, 42, 42, 49, 62, 64, 66, 66, 70, 71, 72, 73, Al-Dossary, Muhammad ibn Ahmad, 181 Electric Power Unit, 35 Far East, 153
73, 76, 76, 77, 78, 80, 82, 83, 84, 86, 87, 87, 89, 90, 95, 99, Al-Douhan, Douhan, 72, 72 Elf Aquitane, 125 farming, 36, 36, 137, 137, 50, 50, 51
105, 105, 108, 111, 160. See also Well No. 7 (Dammam Dome) double-hull tankers, 155, 191, 191 Eli Knudsen (tanker), 204 Farouq (King of Egypt), 136
three-dimensional model, 168, 168 Douglas Aircraft, 120, 160 Eltiste, William, 30, 30, 76, 100, 181, 182 fast track program, 71–72
Well No. 12 fire, 12, 98–100, 98 Al-Dowayan, Nasser Mohammed, 94, 94 embargoes (“oil weapon”), 22–23, 29, 40, 42, 43, 43–44, 45, 80, 88 Father of Petroleum. See Holmes, Frank “Abu al-Naft, Father of Petroleum”
Well No. 43 (non-associated gas), 86, 87 Al-Dowsari, Khalifah, 151, 151 Empire drill, 41, 41 (Major)
Dammam Girls’ School, 12, 12 Dow Chemical Co., The, 77, 163, 193 employee identification badges, 80 fault traps, 174, 174
Dammam Laundry Business, 181 downstream operations, 184–193. See also operations data; upstream operations Employee Relations, 33, 46 feeding the nation, 112
Dammam Port, 136, 140, 140, 36 distribution, 191 Empty Quarter, 7. See also Rub‘ al-Khali feedstocks, 183, 192
Daoud, Bishara, 98, 163 diversification and, 93, 95, 107 energy independence, 160 Feeney, John, 49, 49
Daoudi, M. S., 42 gas fractionation, 190 energy interdependence, 160–162 “field allotments,” 80
D’Arcy, William Knox, 18–19, 18, 20 Oil Supply Planning and Scheduling (OSPAS), 154, 154, 184 Enezi, Mousa S., 139, 139 field parties, 67, 67
Darin, 62 petrochemicals, 192–193 Engineering and Mechanical Services, 186 50/50 profit sharing, 199, 200, 207, 210, 4
Darin Treaty, 6 pipelines, 185 Engineering and Operation Services, 112 “50-in-5” plan, 176, 178
Al-Darwish, Abbas, 132, 132 refining, 187–189 Engineering Services, 35, 163 Filipinos, 78
date palm oases, 8, 9, 12. See also al-Hasa terminals, 185–186 English, Walter, 68 Finance and Government Affairs, 111
224 index index 225
Finance and Treasury, 78 geophones, 112 Half Moon Bay, 54, 54 Al-Humaid, Ahmed S., 72, 72
financial speculation and oil prices, 160 Geophysical Research & Development, 145 Hamilton, Airy, 48 Human Resources and Training, 111
fin-fan coolers, 93, 93 geopolitical climate, 191, 193, 196 Hamilton, Lloyd N., 34, 34, 42, 48, 49, 50, 52, 54, 55, 56, 56, 68, 81, 95 Hundred Men, The (McConnell), 86, 108
firefighting training, 142, 142 geosteering, 144, 145 Hamilton House, 100 “hundred men, the” (reduction in workers), 108–111, 115
fires Geosteering Operations Center (GOC), 181, 181 Hammadi, Sa‘doun, 39 hurricanes Katrina and Rita, 143, 154
Abqaiq, 63, 64, 64 Germany, 5, 20, 21, 40, 96, 97, 99, 104, 111, 112, 116, 104 Hamzah, Fuad, 50 Husain (soldier), 67, 67
Dammam Well No. 12, 98, 98–100 upstream operations, 182 Haradh, xii, 102, 103, 104, 136, 144, 145, 145, 146, 82, 87, 138, 138, Hussein, Hashim, 75, 75
Ju‘aymah, 91–92 Gerrha, 9 140, 140, 141, 144, 145, 150, 156 Al-Husseini, Haitham, 13
“fire temple,” 18–19 Gester, G. Clark, 29, 68, 89 operations data, 199, 199 Al-Husseini, Hassan, 13
First Five-Year Development Plan, 49 Getty, J. Paul, 201, 201 “hardship pay,” 169 Al-Husseini, Ibrahim (Colonel), 13
Fish, Bert, 98, 127 Getty Oil Co., 197, 198, 201 hardships, joy, and laughter, 13–14 Al-Husseini, Ihsan, 13
fishing, 12, 13 Al-Ghamdi, Nasser, 117, 117 Hardy, Norman “Cy,” 142, 204, 205 Al-Husseini, Moujahed, 13
fixed drilling platforms, 124, 124 Ghanim, Salah A. W., 47, 47 Harmaliyah, 82, 102 Al-Husseini, Najat, 13, 13
Flackmeier, Harry, 136 Ghawar, 13, 72, 73, 103, 103–105, 106, 145–147, 22, 22, 49, 87, Harr, 16 Al-Husseini, Sadad, 13, 14, 82, 88, 111, 114–115, 119, 119
flaring natural gas, 6, 29, 49, 89, 89 102, 116, 125, 140, 144, 145 Harriss, Jerry, 67, 67, 84, 84, 105 Al-Husseini, Saif, 172
“floating hotels,” 53 Ghinah, 113 Harsusi, 133 Al-Husseini, Zafer H., 21, 21
Flood, Bill and “Dotty,” 164 Al-Ghoson, Huda M., 77, 158, 158 Hart, Parker T., 125, 127, 127, 129 Al-Huzaim, Hilal Y., 8, 8
fluid hydroformer, 8, 8–9 Ghouth, Bader (Captain), 108, 108 Haruri, 121, 121 hydrocarbon reservoirs, 76, 112, 113, 117, 118, 177, 177
Fly-Carrier of Disease, The (film), 170 Ghuraymil (Jebel), 71, 81 Harvard (USA), 180, 7 hydrocarbons, 166, 170, 171, 171, 187
Flying Camel (airplane), 166, 166–167 ghutra (headdress), 91, 91, 102, 197, 197 al-Hasa, 3, 4, 5, 5, 6, 7, 8–13, 14, 17, 39, 41–42, 46, 49, 50, 54, 61, 64, 75, 75, hydrocracking, refining process, 188
Foraminifera, 176, 176 giant pumps, 36 79, 85, 89, 111, 116, 148, 174, 195, 51, 125, 127. See also Eastern Province hydrogen sulfide, 183, 199
Forbes, 183 girls’ education, 175, 177, 10–12, 12, 13, 13, 59, 59, 75, 75, 151, 151–152, 152 Al-Hasawi, Hasan, 132, 132 hydroskimming plant, 189
foreign capital resources needed, 35, 43, 52 war years (World War II), 111, 111 Hasan, Muhammad, 11, 11 hydrotreaters, 158
foreign correspondents, 86, 86 Global Positioning System (GPS), 121 Hassan, Fawaz, 146, 147, 147
foreign trade, 193–194 global reach, 107, 153, 155, 159–160 Hattab, Jamil “Baba,” 177, 177 I
fossils, 70–71, 170, 170, 176–177 GOC (Geosteering Operations Center), 181, 181 Al-Hauwaj, Ali, 156, 157 ibn ‘Adwan, Shaykh ‘Abd Allah, 185
Fouad, ‘Abd Allah, 107, 181, 181, 182, 183 Goerner, Hugh H., 64, 205 Hawiyah, 146, 82, 87, 128, 128, 132, 132, 137, 137, 138, 140–141, 150, 161, 161 ibn ‘Agil, Sa‘d, 186, 186
Fourier Transform Mass Spectrometer, 139, 139 Golden Corridor, 72, 72, 74 operations data, 199, 199 ibn Ahmad, ‘Id, 198, 198
fractionation, refining process, 183, 184, 187, 190, 199, 199 gold payments, 46, 50, 52, 54, 55, 57, 57, 61, 195 Hawkins, Monte, 100 ibn ‘Ali, Sharif Husain, 6, 8
Framarzi, Abdul Rahim, 47, 47 golf in Dhahran, 109, 109 Hawley, H. J., 41, 42, 46 ibn Fahad, Ahmad, 143, 143
France, 5, 6, 8, 21, 204, 104, 141 Gondwana supercontinent, 172 Hawtah, 87, 113 ibn Hamaid, Shaykh Rashid, 206, 206
upstream operations, 182 Al-Gosaibi family, 62, 63 Hayes, Joseph, 117, 117 ibn Hasan, ‘Abd Allah, 200, 200
Fraser, William, 39 GOSPs. See gas-oil separation plants Hazmiyah, 113 ibn ‘Isa Al Khalifah, Shaykh Hamad, 26
free gas (non-associated gas), 86–88, 138, 156, 183, 199, 199 Government Affairs, 207, 3, 59, 72, 91, 207 Al-Hazza, Eiman A., 151, 151 ibn Jiluwi, Amir Sa‘ud, 148, 176, 176
“frog” missiles, 105 Government Relations, 77, 94, 127, 143, 146, 148–149, 151, 151, 162, health care, 39, 155, 179, 179–180, 184, 51, 165 ibn Muhammad, Ja‘far, 113
FRPC (Fujian Refining and Petrochemical Co. Ltd.), 153 163, 165, 172, 191, 7 “health of the company” report, 112 ibn Nahir, Khalifah, 203, 203
fuel from turpentine, 17 GPS (Global Positioning System), 121 heavy crude oil, 39, 40, 152, 153 ibn Rimthan, Khamis (guide), 67, 67, 71, 85, 85, 86, 87, 116, 137, 160, 121
Fugate, Frank, 34 grades of crude oil, 152, 162 Heim, Arnold, 17, 17 ibn Sa‘id, Ahmad, 186, 186
Fujian Province, 156, 156, 157 Graham Associates (Roy and Ray), 170 helicopters used in exploration work, 18 ibn Salman, ‘Abd al-‘Aziz, 104
Fujian Refining and Petrochemical Co. Ltd. (FRPC), 153 Grand Hotel, Jiddah, 49, 51, 51 Henry, Annette and Mitzi, 83, 83 Ibn Sa‘oud of Arabia (Rihani), 12
Fuller, Elmo, 129 Granville, Maurice, 42 Henry, Bob, 149 ibn Saqr, Shaykh Sultan, 206, 206
Furman, Steve, 113, 115, 115, 169 Great Britain, 5, 21, 206. See also British government Henry, Schuyler B. “Krug,” 24, 24, 61, 62, 62, 63, 63, 64, 64, 66, 68, 70, 81, 83 Ibn Sa‘ud, 3n. See also Al Sa‘ud, ‘Abd al-‘Aziz ibn ‘Abd al-Rahman (King)
furush, 76, 77, 77 Great Depression, 13, 24, 29, 40, 44, 52, 54–55, 89, 120 hexane, 190, 192 ibn Sulayman, Muhammad, 67, 67
future, managing for the, 118, 118 Greece, 108 high school students, developing, 71–72, 111, 111 ibn Yousuf, Ya‘qoub, 186, 186
“greening of Aramco,” 48 hijar, 14 Ibrahim (driver), 67, 67
G Grobba, Fritz, 97, 99, 99 Hijaz, 6, 8, 36, 39, 40, 40, 43, 43, 71, 137 Ibrahim, Yousuf, 174, 174
Gambusia fish, 180 Group of 23, 39 Hijaz Mountains, 58, 90, 90 Idea Management System (Web-based), 137
gas. See Master Gas System (MGS); natural gas Grumm, Watson, 102 Hills, Liston F., 24, 204, 205 Idrisi dynasty, 79
gas fractionation, downstream operations, 190 Guangdong Province, 153 Hilyard, Lester, 82, 82, 84 IEA (International Energy Agency), 134
gas from coal, 17 guides (Bedouin), 67, 67, 71, 85, 85, 86, 87, 102, 116, 121, 121, 137, 160 Hinna, 66, 68 igneous rocks, 75
gas injection plant (model), 24, 24 Gulbenkian, Calouste “Mr. Five Percent,” 21, 23, 130 Hinnawi, Sami (Colonel), 191, 193 Imam Muhammad ibn Sa‘ud University, Riyadh, 173
gas-oil separation plants (GOSPs), 143, 143, 186, 186, 200, 200, Gulf Cooperation Council, 157 Hoag, Walter, 84, 84 Imperial Geological Survey of Japan, 97
16, 31, 32, 32, 36, 58, 58, 82, 86, 86, 89, 102, 125, 144 Gulf of Aqaba, 97 Hobby Farm, 168 incubators, 113, 137
operations data, 198, 198, 199, 199 Gulf of Mexico, 79, 80, 162 Hodgeson, W., 21, 21 Independent Natural Gas Association of America, 42
upstream operations, 182, 182, 183, 183 Gulf Oil Corp., 22, 26, 27, 28, 50, 30, 45 Hofuf, 5, 5, 6, 8, 9, 10, 10–11, 39, 62, 63, 73, 106, 113, 136, 170, 7 Independent Project Analysis (IPA), 138
gasoline-blending discharge valve, 198, 198 Gulf War, 101–103, 104, 105, 118 Al-Hokail, Abdulaziz M., 70, 82, 111 India, 36, 116, 142, 193, 203, 134, 157, 160
“gasoline famine,” 135 Al-Gusaibi, Ahmad, 148 Holditch, Stephen, 146 Industrial Center, 135, 135
gasoline rationing, 114, 114, 126 gutch (gypsum), 76 Holmes, Frank “Abu al-Naft, Father of Petroleum” (Major) 4, 4, 9, 14, 15, Industrial Development Division (IDD), 181, 182
Gas Operations, 63, 141, 182 16, 17, 24, 26, 30, 30, 35, 42, 43, 48, 50, 50 Industrial Relations, 33, 70, 77, 152, 159
Gaza, 69 H Home Ownership Program, 165, 168, 168, 185, 3, 14, 14, 51. See also housing Industrial Services, 128
Flying Gazelle (airplane), 166 Habboubi, Hanaa H., 139, 139 home schooling, 83, 111, 111, 10, 12 Industrial Training Centers, 174, 8, 10, 10, 34
Gazelle Circle (Easter Egg Row), 127 Habib, Nabeel S., 145, 145 Hong Kong, 153 inflation, 112, 116
Gazzaz, Hasan, 7, 7 Hadeed, 88, 88 Hoover, Herbert (U.S. President), 55 information network of King ‘Abd al-‘Aziz, 36–37, 39
General Agreement of Participation, 41, 42, 45 Haenggi, Walter, 73, 73, 76 Hoover, J. W. “Soak,” 62, 63, 63, 64, 64, 66, 68, 70, 71, 105 infrastructure, 142, 142, 155, 181, 165
“general” category, 159, 165, 194 Hafiz, ‘Ali, 206, 206 horizontal drilling, 74, 113–114, 115, 119, 125, 180 Institut Français du Pétrole, 164
General Petroleum and Minerals Organization (Petromin), 7, 52, 58, 90, 108 Hagerstown, Maryland (USA), 68–69 Hosmer, Jack G., 113 intelligent field concept, 144, 181
geological reconnaissance maps, 66 Hagia Sophia, 40 Houg, Carol DuPriest, 160, 161 “intermediate” category, 159, 159, 165, 194
Geological Technical Services Division, 117 Hague, The, 193, 193, 35, 36, 153 House of Rashid, 7 International Energy Agency (IEA), 134
geological timeline of Saudi Arabia, 172 Haifa, 50 House of Sa‘ud, 7 International Inventors Conference in Geneva (2006), 89
geologic fault in Saudi Arabia, 60, 60 Hajj pilgrims, 35, 39, 43, 43, 44, 44–45 housing, 73, 76, 89, 89, 162, 162–163, 163, 165, 168, 168, 171, 184, 194, International Maritime Organization, 155
geologists, 68, 68, 112, 112 Al-Hajri, Quriyan M., 121, 121 194, 52, 52, 53, 54, 54, 77–78, 78, 81. See also Home Ownership Program international oil companies (IOCs), 159–160
226 index index 227
L Makkah, 6, 8, 28, 35, 44, 44, 46, 51, 56, 90, 138, 207, 7, 189
international operations map, 196 Jungers, Frank, 186, 3, 24, 29, 29, 37, 37, 38, 41, 42, “Labor City” (Madinat al-‘Ummal), 14 malaria, 62, 179, 180
international presence, 107, 153, 155, 159–160 44, 46, 48, 54, 60, 61–62, 63, 64, 64 labor unrest, 158–162, 184–186 Al-Malhouq, Shaykh ‘Abd Allah, 172
International Students Award, 72 company leadership, 204, 205 Al-Lafi, Ali A. Attiyah, 158, 158 Al-Malik Saud Al-Awal (tanker), 205, 205
IOCs (international oil companies), 159–160 Juraifani, Hamad A., 168, 179, 190, 190, 212, 213, 213, 82 LaGuardia Airport, New York (USA), 69, 69 Management Development, 48
IPA (Independent Project Analysis), 138 Jurassic Arab Formation, 82 landing strip, 137 Management Services, 72
IPC. See Iraq Petroleum Co. Jurassic Period, 75, 87, 172, 172, 173, 173, 176 language barrier, 151, 157, 157 managers, Saudi, 21, 21
Iran, 16, 18, 18, 20, 23, 26, 163, 4, 4, 5, 39, 40, 43, 70, 87 al-Latif, Muhammad ibn ‘Abd, 67, 67 Al-Manasir, Farraj T., 8, 8
Iraq, 6, 8, 8, 14, 16, 21, 23, 26, 35, 36, 41, 85, 97, 108, 116, 163, K Latin America, 160 Mandaville, James P., 149, 150
196, 4, 5, 39, 41, 43, 70, 87, 101, 102, 103, 104, 104, 105, 143 Kaba, Fatima, 152, 152 laundry workers, 80, 80 mangrove research and restoration, 160, 160
Iraq Petroleum Co. (IPC), 23, 26, 28, 64, 47, 47, 48, 49, 50, K‘aki, Saleh B., 158, 158 Lawrence, T. E. (Lawrence of Arabia), 6 Manifa, 142, 77, 82, 104, 104, 150, 157
52, 54, 55, 71, 79, 96, 129, 130, 197, 204, 205, 5, 41 Al-Kathiri, Muhammed ‘Ali, 85, 85 lead content in gasoline, 157 Manna‘, ‘Abd Allah, 64, 64
Ishaq, Muhammad, 160 al-Khamis, 10, 10–11 leadership, company, 111, 204–205 Manufacturing Operations, 70
Island of Allah (film), 170, 170 al-Kharj farming project, 137, 137 leadership abilities of King ‘Abd al-‘Aziz, 3, 5, 36, 37 Maracaibo, 24
Israel, 131, 196, 204, 31 Al-Khatib, Muhammad, 168, 168 lean times, transformation, 79–81 Maracaibo, Lake, Venezuela, 23
Israeli-Arab tensions, 20, 22, 29, 42–43 al-Khobar, 9, 12, 65, 76, 76, 77, 77, 90, 111, 127, 143, 149, 149, 158, 160, Lebanon, 8, 8, 71, 131, 133, 133, 134, 157, 165, 193, 196, 33, 41 Marafiq, 196, 199, 199
Istanbul, Turkey, 40 172, 179, 181, 184, 187, 187, 194 Leeds University (U.K.), 74 Al-Marhoun, Jamal, 132, 132
Italian workers, 116, 119, 119, 120, 120, 127, 158, Al-Khobar Electric Co., 181 Legacy of a Lifetime (Ajmi), 13 Marinovic, Baldo, 23, 48, 50
159, 160, 161–162, 10. See also workforce Al-Koheji, Yousef, 80, 80 Lehigh University, Pennsylvania (USA), 212 Marjan, 16, 32, 32, 36, 82, 86, 103, 113
Italy, 106, 106, 107, 107, 108, 109, 141, 153, 155, 155 al-Kut, 10, 10–11 Leiden, 153 Marketing and Supply Planning, 74
Ithmaniya. See ‘Uthmaniyah Karan, 16, 156, 159 Lenahan, William J. “Bill,” 64, 90, 95, 96, 96, 97–98 market vs. posted price of oil, 4, 5, 39, 43
KAUST (King Abdullah University of Science and Technology), lending employees (“seconding”), 62 marl pits, 120
J 151, 151, 163, 164, 166, 166 lessons learned, 125–127, 128, 137, 138 Marshall Plan, 126
J. Clarence Karcher Award, 145 Keith, Thomas, 81–82, 146 letters from oil company employees, 86, 86, 87, 184 Mashour, Mazen M., 89, 89
Jabal Dukhan, 23, 29, 31, 48, 48 Kelberer, John J., 62, 64, 89, 92, 95, 95 Lewis, Leslie, 41 mashrabiyah (privacy screens), 51, 51
jabals (modest hills), 30, 31, 42, 42, 66, 66, 83, 103, 108, 159, 159 company leadership, 204, 205 Libya, 23, 38, 41, 42 Masjid-i-Suleiman, Iran, 18, 18, 20, 23
Jabal School for Boys (Arab Preparatory School, Arab Trade Preparatory Kennedy, John F. (U.S. President), 19 Life magazine, 171 Massachusetts Institute of Technology (MIT, USA), 145
School), 113, 138, 153, 155, 156, 156, 168, 168, 172–173, 175, 177 Kennedy, Mollie, 169, 169 light crude oil, 39, 40, 42, 44, 52, 70, 89, 96, 103, 142, 144, 147, 177 Master Gas System (MGS), 37, 37, 44, 44, 52–54, 53, 54, 58, 81, 86, 88, 88,
Jaber, Shaykh Ahmad bin, 50, 50 Kerr, Richard C. “Dick,” 63, 63, 68, 69, 70, 142 lightering areas, 36, 196 128, 128, 133, 138, 140, 146, 162
Jabrin, 70 Keyes, Robert L., 205 Light Industrial Park, 117 downstream operations, 190, 190
Jackson, Henry M., 44 KFUPM (King Fahd University of Petroleum and Minerals, College of Petroleum lighting, fuel for, 17, 19 upstream operations, 183, 183
Jaizan, 79, 186 and Minerals), 173, 173, 179, 13–14, 20, 48, 72, 72, 74, 142, 157 limestone, 75, 75, 79, 79, 81, 82, 89, 103, 177 Al-Matrood, ‘Abd Allah, 183
Jalali, Mustafa A., 158, 158 Al-Khabbaz, Mohammad, 132, 132 liquid hydrocarbons (condensate), 157, 183 Matthews, Charles, 133, 149
Jamil, ‘Ali Bay, 185 Al-Khayyal, Abdulaziz F., 33, 152, 158, 158, 159 lithosphere, 172 Al-Mausalli, Ahmad ‘Isa, 174, 174
Jana, 16 Al-Khayyal, Khalidah, 59 maximum reservoir contact (MRC) wells, 144, 145, 181
Littlejohn, William Laney, 52, 89
Janson, E. W., 48 Al-Khazin, Jihad, 64, 64 Mazalij, 82, 150
Little League Baseball, 138, 79, 79
Japan, 13, 97–98, 112, 125, 126, 193, 36, 40, 40, 52, 83, Khafji, 142 McConnell, Philip, 72, 86, 86, 108, 109, 112, 160, 161
living conditions, 155, 157, 158, 159, 160, 185
104, 108, 153, 157, 158, 162, 163, 189, 192 Khamsin, Salim Abu, 74 McDonald, Harry, 149
Local Industrial Development, 46, 51
Al-Jasir, Shaykh Hamad, 172 Khan, ‘Ajab, 64, 148 Logan, Sam “Mr. Sam” and Mildred, 137 McGhee, George, 200
Jassim, Hijji bin, 110, 111 Khazindar, Husain, 160 McIntosh, Clarence J., 127
logo, Saudi Aramco, 136, 136
Javits, Jacob K., 44 al-Khobar, 10, 11, 47, 51 Medical Services, 77, 137, 151
Lombardi, Maurice E., 25–26, 26, 27, 29, 41, 42, 43, 46, 47, 48, 49, 50, 55, 63
Jawf, 140 Khuff formation, 39, 86, 87, 88, 140 Mediterranean Sea, 131, 132
London, 130, 130, 202, 35, 153
Jazan region, 153, 189 Khurais, xii, 81, 82, 102, 102, 130, 130–131, 150 Meeker, Floyd, 81
Long Beach, California (USA), 132, 132
Jebel Ghuraymil, 81 Khursaniyah, xi, 87, 146, 147, 150, 150, 199, 199 Mellon, Andrew, 27, 28
Longrigg, Steven, 50, 50, 52, 54, 55, 79, 96
Jersey. See Standard Oil of New Jersey Khuzam Palace, 34, 34, 50 Memphis State University, Tennessee (USA), 72
Loomis, Francis B., 42, 43, 46, 47, 49
Jiddah, 8, 28, 28, 34, 35, 37, 39, 43, 44, 46, 48, 49, 50, 50, 51, King, Henry C., 36, 40 metamorphic rocks, 75
Los Angeles Times, The, 169, 106
51, 53, 54, 55, 56, 61, 64, 77, 81, 90, 95, 96, 97, 97, 99, 127, King Abdulaziz Center for World Culture, 166 methane (sales gas), 52, 183, 187, 187, 190, 199
Louisiana (USA), 124, 196
148, 173, 196, 198, 201, 207, 211, 65, 65, 108, 111, 163 King Abdulaziz University in Jiddah, 173, 45, 45 Mexico, 23
“Lucky No. 7.” See Well No. 7 (Dammam Dome)
downstream operations, 185, 186, 188, 189 King Abdullah University of Science and Technology MGS. See Master Gas System
Lukoil, 141
Al-Jihian, Muhammad, 64, 64 (KAUST), 151, 151, 163, 164, 166, 166 microfossils, 176, 176
Luksar Energy Limited, 141
jinn (genies), 85 Kingdom of Hijaz and Najd and Its Dependencies, 46 micropaleontologists, 177
Lunde, J. P., 21, 21
Al-Jishi, ‘Abd Allah Jasim, 154, 154 Kingdom of Saudi Arabia, xi, 3, 4, 7, 8, 46–48, 47, 127, 173, 186, 5, 10. Middle East Export Press, 170
Luqman, Muhammad, 151, 151
Job Skills Training, 176 See also Al Sa‘ud (Kings); Saudi Arabia Midrikah, 156
Luttrell, Robert, 36
joint ventures, 89, 95, 96, 107, 108, 109, 111, 124, King Fahd University of Petroleum and Minerals (KFUPM, College of Petroleum Midyan, 97, 97
124, 141, 153, 156, 157, 162, 163 and Minerals), 173, 173, 179, 13–14, 20, 48, 72, 72, 74, 142, 157 Milan, 153, 155, 155
M
downstream operations, 188, 189, 189, 192, 193 King Sa‘ud University (Riyadh University), 72, 77 Miller, Otto N., 42
Maby, Robert L., Jr., 157
operations data, 198 Kingsbury, K. R., 26, 27, 28, 41, 48 Miller, Robert P. “Bert,” 24, 24, 61, 62, 62, 63, 63, 64, 66, 69, 70, 71, 73, 73
MacPherson, James “Mr. Mac,” 128–129, 129, 138, 142, 149, 201
Jones, Patsy, 83 Kinnear, James, 146 Ministry buildings, 208–209, 209
Madani, Mansoor, 158, 158
Jordan (Transjordan), 6, 8, 8, 79, 131, 134, 165, 196, 20, 22, 33 Kirkuk, 17, 22, 23, 36, 163, 41 Ministry of Finance, 34, 39, 49, 50, 52, 53, 55, 56, 90, 98, 101, 142, 146, 148,
Madgwick, George, 25
Ju‘aymah, 53, 54, 60–61, 61, 91–92, 93, 93, 103, 120, 150, 163 knowledge-based society, building a, 163–166 162, 173, 207
Madinah, 6, 35
downstream operations, 185, 186, 186, 190 Koch, Thomas W., 63, 63, 72, 73 Ministry of Higher Education, 173, 13
Madinah Gate, 44, 44, 97, 97
operations data, 198, 198, 199, 199 Kombargi, Shafiq W., 199, 199 Ministry of Petroleum and Mineral Resources, 155, 156, 210, 6, 7, 10, 13, 24, 37,
Madinat-Abqaiq, 168, 168, 171, 171
Jubail, 5, 6, 8, 27, 27, 61, 62, 63, 63, 64, 64, 66, 66, 68, 69, 70, Korean War, 168, 199, 200, 204
Madinat al-‘Ummal (“Labor City”), 14 71, 89, 92, 93, 95, 104, 107, 111, 125, 151, 151, 158
70, 71, 72, 96, 96, 37, 54, 54, 62, 105, 105, 108, 153, 163 Kreider-Reisoner, 69 Al-Maghlouth, Khalid Nassir, 72 Miocene Period, 25, 41, 73
downstream operations, 188, 188–189, 189, 190 Kristofferson, H. C., 21, 21 magnetic resonance imaging (MRI), 116 Mishari, Ibrahim S., 74
operations data, 199, 199 Krueger, L. P., 192, 192 Mahmud, Ahmad Muhammad, 64, 64 Miyah-A Story of Water (film), 170
Jubail Industrial City, 88, 88 Kuwait, 5, 7, 13, 13, 14, 16, 23, 23, 50, 96, 126, 142, 4, 5, 38, 41, 101, 102, Al-Majdhub, ‘Abd Al-Mun‘im, 185 Mo‘ammar, Masha‘el, 59, 59
Jum‘ah, Abdallah S., 12, 111, 186, 49, 49, 62, 91–92, 103, 104, 105 Majid, Said, 174, 174 Mobil (Socony Vacuum), 29. See also Arabian American Oil Co. (Aramco)
111, 119, 119, 125, 125, 136, 137, 141, 161 Kuwait City, 177, 43 majlises (traditional open meeting rooms), 41, 50, 55 Mobil Oil Co., 183, 41, 42, 80, 80, 108, 125
company leadership, 204, 205 Kuwait Oil Co., 47, 47, 197, 201, 45 majority stake in Aramco by Saudi Arabia, 45–46 modernization plans of Saudi Arabia, 207, 210–211, 4, 163
Jum‘ah, Jaber S., 72, 112, 125, 126, 135 Al-Makhaytah, ‘Abd al-Latif ‘Abd Allah, 99, 101 modern oil industry, 17, 19
Jum‘ah, Jasim, 151, 151
228 index index 229
Moffett, James A., 162 operations data, 199, 199 Oil Creek (Pennsylvania, USA), 17, 19 PDPs (Professional Development Programs), 64, 72, 73
Moffitt, Richard G., 121, 121 production history, 200–201 oil glut, 23 pearling, 12, 13, 13, 26
Mollo, George J., Jr., 111, 111 upstream operations, 183 Oil in the Arab States (Al-‘Abbusi), 5 Pennsylvania (USA), 17, 19, 20, 20, 23, 162, 11
Moore, W. F., 138, 205 natural gasoline. See Natural Gas Liquids (NGLs) oil operations, 198, 198 pentane, 190
Moose, James S., 127 Nawwab, ‘Abd al-Hafiz, 172 oil seeps, 16, 16, 17, 18 people power (self-development), 135–137
Al-Moqbil, Ahmad R., 8, 8 Nawwab, Ismail I., 72, 72 Oil Spill Contingency Plan, 104, 105 performance standards, rethinking, 137–138
Mosque of the Adenese, 78, 78 Nazer, Hisham M., 89, 92, 95, 95, 102, 103, 107, 107 oil spill in Arabian Gulf, 103–106, 104, 105 “permanent shortage” of 1970s, 135
mosquitos, fighting, 180 company leadership, 205 Oil Spill Service Center, 104 permeability, 177, 177
“most ambitious energy project in history,” 49, 52–54, 58 Near East College Association of Beirut, 176 oil stabilizer plants, 160 Permian Basin, West Texas (USA), 23
Mosul, 21 Near East Development Corporation (NEDC), 22–23, 26 Oil Supply Planning and Scheduling (OSPAS), 154, 154, 184 Persia, 4, 15, 18, 20, 23, 35, 36, 41
mothballing, 82, 86, 102, 102 “Near East” map, 8, 8 oil tanker loading celebration, 90, 91, 91, 95, 160 Persian Gulf, 49, 74
Motiva Enterprises LLC, 124, 124, 153 Nearpass, G. McLean “Mac,” 138, 172 “oil weapon.” See embargoes Peshawar, 64
Motor Oil (Hellas) Corinth Refineries S.A., 107 “net-back” contracts, 88 Oily Bird, 74 petrochemicals, 133, 152, 153, 156, 158, 162–163, 166
Al-Mousa, Bader, 155, 155 Netherlands, 8, 35, 43, 104, 146, 146, 153 Oklahoma (USA), 23, 182 downstream operations, 190, 192–193, 199
Mousli, Na‘ilah, 75, 88, 88 Netherlands Bank, 53, 55, 57, 57 Olayan, Suliman, 147, 148, 183 upstream operations, 183
MRC (maximum reservoir contact) wells, 144, 145, 181 Neutral Zones, 14 Old Town Camp, Bahrain, 31, 31 Petrola, 108
MRI (magnetic resonance imaging), 116 New Business Development, 141, 162 olefins, 192, 193, 193 Petroleum Concessions Ltd., 79, 95, 96
Mubarak, ‘Abd al-Rahman M., 9, 9 New Deal, 54–55 Oman, 206, 112, 112 petroleum engineer, first woman, 75
al-Mubarraz, 99 New Horizons Idea Award, 180 Onassis (Aristotle) arbitration, 200–201, 203, 203 Petroleum Engineering and Development, 88, 102, 144
Al-Mughamis, Mohammad, 179 New York (USA), 78, 202, 202, 213, 153 Onsan, 107, 107 Petroleum Technology Research Centre in Canada, 158
Al-Muhareb, Ali A., 78 New York Mercantile Exchange, 160 OPEC. See Organization of Petroleum Exporting Countries petroleum traps, 170, 174, 174
Al-Muhtasib, Ibrahim, 211, 212, 212 New York Times, The, 8, 98, 104, 42, 160 “Open Door Policy,” 21 Petroline, 58
Muhammad, ‘Abd Allah, 159, 159 New York University (USA), 7 Operations Coordination Center (OCC), 91, 91, 154, 154, 184, 184 Petromin (General Petroleum and Minerals Organization), 7, 52, 58, 90, 108
Muller, Hendrik, 139, 139 New York World Telegram, 87, 87 operations data, 194–203. See also downstream operations; upstream operations Petron Corp., 107, 141
Mulligan, William, 148, 172, 202, 203 New Zealand, 62, 104 domestic operations map, 195 Petro Rabigh, 108, 162, 162, 163, 185, 188, 192
multilateral drilling, 114–115, 180, 181, 181 NGI (Natural Gas Initiative), 141 gas operations, 199, 199 Pherkad Star (supertanker), 108, 108
Multinational Corporations (U.S. Senate Subcommittee), 44 NGLs. See Natural Gas Liquids international operations map, 196 Phi Kappa Phi honor society, 72
Al-Munif, Munif, 111, 111 Nigeria, 36 natural gas liquids (NGLs) production history, 200–201 Philby, Harry St. John Bridger (“Abd Allah”), 17, 35, 36, 37, 43, 46–47, 49, 49,
Al Murrah tribe, 7 nitrogen oxides, 124 oil and gas operations map, 197 50, 52, 54, 55, 97
Murraba‘ Palace, 112, 112 Nixon, Richard M. (U.S. President), 31, 43 oil operations, 198, 198 Philippines, 111, 141
Murray, Wallace, 42, 43 NOCs (national (state-owned) oil companies), 159–160 oil production history, 200–201 Phoenix Star (tanker), 83, 83
Al-Musaiid, Hesham, 74 “nominations” (projections of crude oil required), 29–30 production history, 200–201 Piazza Duomo, 155, 155
Al-Mustafa, Ameera A., 75, 75 Nomland, Jorgen “Doc,” 29, 64, 71, 79 workforce history, 202–203 Piercy, George, 39
Mussolini, Benito, 108 non-associated gas (free gas), 86–88, 138, 156, 183, 199, 199 Operator Training Simulation (Web-based), 136 pipelines, 18, 18, 90, 98, 98,128, 143, 36, 58, 63, 90, 90, 91, 102, 120, 120,
Mutawi‘, Hamid, 64, 64 Al-Noor, ‘Abd, 151, 151 Oregon State University (USA), 77 125, 127, 150
Al-Mutlaq, Abeer M, 151, 151 Al-Noor, Mohammad, 132, 132 Organization of Arab Petroleum Exporting Countries (OAPEC), 38 downstream operations, 185, 191, 195
Mutlaq (Bedouin), 113 North Camp, 78 Organization of Petroleum Exporting Countries (OPEC), 210, 4, 4, 5, 7, 38, 41, plane table, 70
Northern Area Manufacturing, 82 42, 43, 45, 79–80, 88, 89, 91, 118, 125, 142 Planning, 72
N Northern Area Operations, 82 “Origin of Oil, The” (Steineke), 74 “Planning Guides for Aramco as a Corporation” (Barger), 3, 6, 24
Nagasaki, 36, 83, 83 Northern Area Producing, 48 origins of oil and gas, 74–75, 170–171 plant safety (safety procedures), 62–63
Al Nahyan, Shaykh Zayed ibn Sultan, 206 North Pier, Ras Tanura, 185 Flying Oryx (airplane), 166 Plants and Pipeline, 63
Al-Naimi, Ali I., 155, 156, 172, 176, 190, 190, 212, 213, 213, North Riyadh Bulk Plant, 127 Al-Osaimi, Mohammed A., 158 plastics industry, 133, 163, 192
21, 46, 48, 49, 49, 64, 69, 70, 70, 71, 91, 92, 93, 95, 95, 107, North Sea, 23, 79, 80, 80, 119, 134 OSPAS (Oil Supply Planning and Scheduling), 154, 154, 184 plate tectonics, 172
107, 108, 111, 125, 125, 133, 151, 151, 153, 162, 166 North Slope of Alaska, 134 Al-Othman, Abdullatif A., 73, 136 PMI (Project Management Institute), 126, 138, 140
company leadership, 204, 205 Nuayyim, 150 Ottoman Empire, 5, 6, 7, 8, 8, 9, 20, 21, 23, 36, 39, 40, 137 PM Network, 77
Najd, 3, 6, 12, 14, 15, 16 Out in the Blue (Barger, Tim), 87 “point of transformation,” 144–146
Najran, 72 O Out-of-Kingdom Training, 72 polymers, 192
al-Na‘lah (En Nala), 72, 73 OAPEC (Organization of Arab Petroleum Exporting Countries), 38 Owen, Bill, 41 polystyrene, 192
names for Tapline pumping stations, 133, 133 oases, 8, 9, 12. See also al-Hasa Owen, Garry, 146, 146 porosity, 177, 177
naphtha, 192 Oasis of Al-Hasa, The (Vidal), 149 Owen, William L., 191, 193, 7, 7 portable housing, 89, 89, 162, 162, 194, 194
naphthalene, 192 Oberlin College, 36, 40 ownership of Arabian American Oil Co. (Aramco) by Saudis, 29, 40–41, Port Arthur, Texas (USA), 95, 124
naphthenes, 187 OCC (Operations Coordination Center), 91, 91, 154, 154, 184, 184 45–46, 64, 69, 159 posted vs. market price of oil, 4, 5, 39, 43
Al-Nasr, Nadhmi A., 163 Occidental Petroleum Co., 39, 41 ozone precursors, 124 power grid (electrical), 58, 60–62
Nasif, Shaykh Muhammad, 50 Offshore Drilling, 106 power plants built, 73, 142
Nasser, Amin H., 20, 144 offshore oil and gas, 124, 124, 138–139, 142, 16, 16, 17, 17, 32, 32, 34, 36, 37, P POWERS (Parallel Oil Water and Gas Reservoir Simulator), 116, 179
Nasser, Gamal Abdel (Colonel), 203–204 37, 52, 58, 58, 74, 80, 80, 82, 84, 84–85, 86, 86, 103, 103, 156, 157, Pacific Theater, serving the, 115–116, 118, 121, 121, 126 Powers, R. W. “Brock,” 4, 18, 20, 29–30, 61, 64
National Bank of Turkey, 21, 130 159, 159. See also Safaniya; specific facilities Pacific Western Oil Corporation, 201 company leadership, 205
National Commission for Wildlife Protection and Development, 106 downstream operations, 186, 186 Page, Robert C., 179, 179 Precambrian Era, 75, 172
National Council on U.S.-Arab Affairs, 72 upstream operations, 180 Pakistan, 10 Preferential Area of Standard Oil Co. of California, 47, 47
National Dairy and Ice Cream Plant, 183 Ohliger, Floyd, 76, 77, 77, 81, 97, 98, 148, 162 Pakistanis, 142 Presidency of Meteorology and Environmental Protection, 106
nationalization, 40, 41, 45 oil and gas. See also downstream operations; natural gas; operations data; Paleozoic Era, 172 president of Aramco, first Saudi, 21, 69, 70, 70
National Laundry, 183 price of crude oil; Saudi Arabian Oil Co. (Saudi Aramco); supply and Palestine, 69, 131, 132, 196, 196 pressure vessels, 147
national (state-owned) oil companies (NOCs), 159–160 demand; upstream operations Palestinians, 120, 142, 157, 199, 199, 10, 20, 31, 42 Price, Ed, 88
natural gas, 72, 72, 76, 6, 29, 39, 39, 49, 119, 138, 140–141, 147, 150, 156, crude oil classifications, 39, 152, 162 Palmer, William, 106, 108, 148 price of crude oil
163, 175, 175. See also oil and gas discoveries (major) 1859–1939, 23 Palm Springs, California (USA), 40 “basket” of prices, 89
operations, 199, 199 operations map, 197 palynologists, 177 dramatic swings in, 101
production and processing, 182, 183 origins of, 74–75, 170–171 Pan American Petroleum and Transport Co., 22 falling, 19, 24,138, 5, 80, 82, 113, 118, 126, 134, 142
Natural Gas Initiative (NGI), 141 production and processing, upstream operations, 182 Pangea, 172 gyrations of, 4
Natural Gas Liquids (NGLs), xi, 37, 37, 52–54, 53, 54, 56–57, 57, 58, 81, production history, 200–201 paraffins, 187 posted vs. market price, 4, 5, 39, 43
109, 150, 150 reserves, 72, 72, 74, 22–23, 134, 143, 175, 175 Parallel Oil Water and Gas Reservoir Simulator (POWERS), 116, 179 quota strategy, 79, 80, 88–89, 91
downstream operations, 184, 185, 190, 192 Oil Caravan, The (Qafilat az-Zayt), 158, 158 participation agreement, 40–41, 42, 45
230 index index 231
rising, 53, 55, 126, 32, 39, 40, 42, 44, 49, 70, 80, 86, 102, 125, 135, 172, 174, 178, 180, 182, 195, 195, 198, 198, 201, 4, 8, 8–9, 10, 15, Royal Dutch-Shell Group, 19, 20, 21, 109, 141 Al Sa‘ud, Faysal (King), 56, 206, 211, 3, 4, 4, 6, 10, 13, 19, 42, 44, 49, 52, 81
142, 152, 160, 161 16, 26, 31, 31, 36, 48, 52, 54, 77–78, 91, 95, 95, 105, 120, 125, 125 Royal Mint in Britain, 57 First Five-Year Development Plan, 49
Sidon price claims, 7, 10, 19 downstream operations, 185, 188, 189, 190 Royal Navy (British), 18, 19, 29, 111 Kennedy (U.S. President) and, 19–20
private sector vs. Aramco, 81–82 operations data, 198, 198, 199, 199 Rub‘ al-Khali, xv, xvi, 5, 7, 56, 67, 111, 197, 197, ix, x–1, Second Five-Year Development Plan, 52, 81
Producing and Water Injection, 48, 49 upgrade, 125–126, 127, 137, 138 16, 18, 18, 39, 39, 119, 120, 120, 121, 141 Al Sa‘ud, ibn Muhammad, 7
product carriers, 155, 191 Rathbone, Monroe, 5 Rubaya‘, Sulaiman, 212, 212 Al Sa‘ud, Imam ‘Abd al-Rahman, 7
production history, 200–201 recovered oil from oil spill, 105, 106 Al-Rushaid Group of Saudi Arabia, 89 Al Sa‘ud, Khalid (King), 37, 37, 52, 62, 64, 69
production increase for wartime effort, 102–103 Al-Redaini, Saleh, 58 Russia. See Soviet Union Al Sa‘ud, Muhammad ibn, 7
Products Distribution, 21 Red Crescent, 191, 204 Rutherford, M. R., 127 Al Sa‘ud, Sa‘ud (King), 174, 185, 196, 3, 6, 10–11, 19, 207
Professional Development Programs (PDPs), 64, 72, 73 Red Line Agreement, 20, 21–24, 26, 129–130 Ruwaili, Haitham, 137 Aramcons and families reception hosted by, 207
profit sharing, 197–200, 207, 210, 4 Red Sea, 75, 79, 96, 131, 33, 54, 57, 58, 97, 97, 109, 163, 172, 182, 185, 191 Ryan, Sir Andrew (“Last of the Dragomans”), 50, 55 Al Sa‘ud, Sa‘ud ibn ‘Abd al-‘Aziz Al-Zayd (Sa‘ud Al-Kuwaiti), 108
projections of crude oil required (“nominations”), 29–30 Red Sea Refining Co., 189 Al Sa‘ud, Turki ibn ‘Abd Allah, 7
project management, centralized, 35, 35 refined liquid petroleum gasses (RLPG), 185 S Al Sa‘ud Dynasty, 5, 7, 7
Project Management IBM, 34, 34 refineries, 78, 108, 107, 107, 108–109, 118, 124, 133, 152–153, 158, 160. Al-Saadoun, Hamed T., 48 Sa‘ud Al-Kuwaiti (Al Sa‘ud, Sa‘ud ibn ‘Abd al-‘Aziz Al-Zayd), 108
Project Management Institute (PMI), 126, 138, 140 See also Ras Tanura; specific refineries Al Sabah, Shaykh Mubarak, 7, 7 Saudi Arab Government (SAG), 162
Project of the Year Awards, 138, 140 downstream operations, 187–189 SABIC (Saudi Basic Industries Corporation), 92, 162 Saudi Arabia, iv, xi, xii, xiii, xv, 46, 49, 54, 54, 131, 132, 135, 138, 206, ix. See also
project planning and execution process, 125–127, 128, 137, 138 Refining, Marketing & International, 107, 152, 156 Sabini, John Anthony, 149 cross-cultural relationships; Eastern Province; Al Sa‘ud (Kings);
Project Support and Controls, 77 regenerator, 162, 162 sabkhahs (small salt flats), 76, 147, 119 Saudi Arabian Oil Co. (Saudi Aramco)
promotion of Saudis, 46, 48 relinquishments of non-oil producing portions, 18, 68 Sa‘d, ‘Aziz A., 9, 9 frayed relationship with Aramco, 162–163, 165, 168
propane, 187, 187, 190, 192. See also Natural Gas Liquids (NGLs) remarkable relationship, 84–85, 87 Safaniya, 124, 124, 139, 142, 16, 16, 34, 36, 37, General Agreement of Participation, 41, 42, 45
propylene, 163, 192, 193, 193 Rentz, George, 133, 148, 148, 149 37, 74, 77, 82, 84, 84–85, 103, 105 modernization plans of, 210–211, 4, 163, 207
prospects, identifying, 170 Report of Operations (Aramco), 170 safety procedures for plants, 62–63 ownership of Arabian American Oil Co. (Aramco), 29, 40–41, 45–46,
“Prosperity Well.” See Well No. 7 (Dammam Dome) Repsol YPF, 141 Saggaf, Muhammad M., 145, 145 64, 69, 159
Public Affairs, 172, 72, 75, 77 Republic of Korea, 107, 107, 108, 134, 134, 153, 155, 157, 162 Al-Saif, Abd Allah S., 119, 119, 159, 159 stratigraphy of Eastern Saudi Arabia, 173
Public Relations, 172, 21, 46, 49, 62 downstream operations, 189 sails (Vela), 83 “swing producer,” 31–32
pumping units, 137 resbots (reservoir nano-agents), 180 Saiph Star (tanker), 191, 191 transformation of society, 54, 54, 56
pump stations (Tapline), 133, 133, 134, 135 Research and Development (R&D) Center, 139, 139 Salamah, Muhammad A., 148, 151, 151, 186, 212, 212 Saudi Arabia (Twitchell), 39
pygas, 193, 193 Research Institute of Innovative Technology for the Earth, 158 Saleh, Hamzah, 111 Saudi Arabia-Kuwait Neutral Zone, 96, 138, 201
Pyxis compass, 83 reserves of oil and gas, 72, 72, 74, 22–23, 134, 143, 175, 175 Saleri, Nansen, 118, 160 Saudi Arabian Marketing and Refining Co. (Samarec), 108, 109, 110, 110
reservoir sales gas (methane), 52, 183, 187, 187, 190, 199 Saudi Arabian Oil Co. (Saudi Aramco). See also Arabian American Oil Co.
Q characterization, 179 Salhah, Najib, 50 (Aramco); “Aramcons”; California Arabian Standard Oil Co. (Casoc);
Al-Qafilah al-Usbu‘iyyah (Weekly Caravan, The), 158 management, 77, 114–118 Salih (cook), 67, 67 downstream operations; operations data; Saudi Arabia; upstream operations
Qafilat az-Zayt (Oil Caravan, The), 158, 158 pressure, 49, 54, 55, 55, 180 Saline Water Conversion Corp. (SWCC), 199, 199 company leadership, 204–205
Al-Qahtani, Abdullah M., 145, 145 simulation, 115, 115–116, 116 Salwah, 70, 84 corporate air fleets, 140, 140
Al-Qahtani, Ayed, 111 Reservoir Characterization, 117, 145 Samarec (Saudi Arabian Marketing and Refining Co.), 108, 109, 110, 110 diversification, 92, 93, 95, 95, 96
Qaisumah, 85, 132, 134, 143 Reservoir Description and Simulation, 77 Samarkand (Uzbekistan), 40 employee identification badges, 80
al-Qasim, 82, 125, 127 Reservoir Engineering, 75, 88 SAMCOM (Saudi Arab Manpower Committee), 64 logo, 136, 136
Al-Qasim, Ziyad, 134, 134 Reservoir Management, 115, 118, 118, 160 Sander, Nestor John, 86, 104, 105, 144, 145, 146, 147 Oil Spill Contingency Plan, 104, 105
Qasim, 52 reservoir nano-agents (resbots), 180 San Francisco, California (USA), 48, 50, 68, 71, 73, 78, 80, 81, 84, 89, 90, 105, 202 social responsibility evolution, 164, 164, 165, 165
Qatar, 7, 23, 49, 102, 206, 41 Reynolds, George, 18 SASC (Saudi Aramco Sino Co. Ltd.), 153 Star Enterprise, 95, 95, 96
Qatif, 5, 6, 6, 8, 9, 12, 54, 54, 62, 73, 143, 87, 142, 143, 143, 144, 144 Rhoades, Ralph “Dusty,” 26, 28 SaskPower, 158 United States of America (USA) and, 153, 161, 189, 196
downstream operations, 190 Richards, Don E., 185 SASREF (Shell in Jubail), 188–189, 189 Saudi Arabian Tankers Co., Ltd. (Satco), 201
Qatif Treaty, 6 Richmond Exploration Co., 142 SATORP (Total Refining and Petroleum Co.), 188–189 Saudi Arab Manpower Committee (SAMCOM), 64
Al-Qudaihi, Jasim ibn Muhammad, 154, 154 Al-Ridhwan, ‘Abd Al-‘Aziz, 136, 136 Satterthwait, Arnold, 174, 174 Saudi Aramco. See Saudi Arabian Oil Co.
Queen Mary (barge), 124, 124 Rider University, New Jersey (USA), 179 Al Sa‘ud, ‘Abd al-‘Aziz ibn ‘Abd al-Rahman (King), xi, 5–8. Saudi Aramco Exhibit in Dhahran, 92, 92
quick response, 91–92 Rihani, Ameen, 3, 4, 12, 12, 14, 15 See also Kingdom of Saudi Arabia; Saudi Arabia Saudi Aramco Sino Co. Ltd. (SASC), 153
quota strategy, 79, 80, 88–89, 91 rijm (pile of rocks), 71 Americans as viewed by, 55 Saudi Aramco World, 170. See also Aramco World
Qurain, 73 ripple effect, 183, 80 Aramcons and families reception hosted by, 160, 161, 207 Saudi Basic Industries Corporation (SABIC), 92, 162
Quran, 173, 20 Riverhead, New York (USA), 151, 157, 174 CASOC facilities visited by, 88, 88 “Saudi Camp,” 13
Qurayyah Seawater Treatment Plant, 35, 35, 52, 55, 55, 58, 82, 102, 152 Riyadh, 3, 4, 5, 7, 9, 9, 32, 38, 38, 39, 52, 79, 81, 82, 90, 97, consolidation of territories by, 3–4, 5, 14, 120 Saudi Camp School, 110, 110, 113
Qurishi, Ahmed Abdullah, 68 98, 102, 120, 136, 137, 140, 142, 142, 159, 170, 196, 207, death of, 174, 185 Saudi Consolidated Electrical Co. (SCECO), 60, 60–61, 61, 62
208–209, 209, 20, 50, 104, 108, 125, 127, 137, 158 foreign capital resources needed and, 35, 43, 52 Saudi Development Committee, 46
R downstream operations, 188, 189 information network of, 36–37, 39 Saudi Electric Co., 62, 199, 199
Rabil, Annette, 83 Riyadh University (King Sa‘ud University), 72, 77 leadership abilities of, 3, 5, 36, 37 Saudi-Kuwait Neutral Zone, 142, 197
Radhi, Ahmad, 203, 203 riyals, 195, 195, 210, 10, 10 modernizing government by, 207, 210–211 Saudi National Guard, 20, 20, 105
Radiology Group, 137 RLPG (refined liquid petroleum gasses), 185 negotiation talent of, 5 Saudi Refining Inc., 124, 124
Radio Makkah, 10 Robert College, Istanbul, 40 official coins, first, 195 Saudi workers, 76, 76, 77, 77, 87, 89, 100, 101, 117, 117, 133,
radio shack and towers, 107, 142, 142 Robert Morris Junior College in Pittsburgh (USA), 11, 11 oil tanker loading celebration, 90, 91, 91, 95, 160 136, 139, 139, 158, 160. See also workforce
Rafha, 134 Rocheville, Charles, 63, 63, 69, 70 personality of, 2, 3 “Saudization,” 139, 139, 176, 46, 48, 63–64, 69, 73
Rafie, M. Yusof, 102, 141 rock, studying, 112 photographs of, 2, 4, 7, 12, 91, 94, 111, 161, 201, 207 scale of operations, 34, 36
Al-Rahman, ‘Abd, 5 “rock oil,” 17, 19 railroad and, 137 Scandinavia, 194, 194
Rahimah, 11, 15, 15 “Rock Wednesday” demonstrations in Dhahran, 20–23 Riyadh recaptured by, 5, 7, 170, 170 scanning electron microscope, 177, 177
railroads, 136–137, 137, 140 Rodgers, William S. S., 204, 205 Roosevelt, Franklin Delano (U.S. President) and, 94, 94, 119–120, SCECO (Saudi Consolidated Electrical Co.), 60, 60–61, 61, 62
rainfall. See water importance Rodinia supercontinent, 172 127, 136, 137, 196 Schloesslin, Jack, 76
Ras al-Mish‘ab, 132–133, 135, 135 Rodstrom, Charles, 80 subjects (providing for) goal of, 3–4, 14, 37, 39, 90, 111, 120 scholarships, 180, 180, 192, 192, 193, 211, 212, 212, 213, 213, 47, 50, 50, 51,
Al Rashid, 6 Rolling Hills Country Club, 109, 109 suspicion of outside influence, 5, 14, 16, 35, 55, 98 111, 137, 164. See also education
Al-Rashid, Rashid, 190, 190 Roosevelt, Franklin Delano (U.S. President), 54–55, 126, 136, 137, 162 vision of, 166 schools. See education and training
Ras Safania, 70 ‘Abd al-‘Aziz (King) and, 94, 94, 119–120, 127, 136, 137, 196 warrior skills of, 3, 5 Scottsdale, Arizona (USA), 42
Ras Tanura, 39, 41, 89, 89, 90, 98, 98, 107, 111, 115, 116, 117, 117, Roosevelt, Theodore (U.S. President), 42 Al Sa‘ud, ‘Abd Allah (King), 69, 74, 125, 125, 133, 141, 163, 164 Sea Island, Ras Tanura, 31, 31, 81, 81, 148–149, 149, 185
120, 121, 121, 125, 128, 128, 129, 129, 131, 132, 142, 143, 158, “Roosevelt Recession,” 89 “Aramcons” and families visited by, 165–166, 167, 167 seawater injection system, 54, 55, 55
159, 160, 162, 163, 163, 164, 164, 165, 165, 168, 169, 169, 171, rotary drillers, 101 Al Sa‘ud, Fahd (King), 42, 69, 95, 108, 109, 111, 163 seawater treatment, 35, 35, 52, 82, 102, 152
232 index index 233
Second Five-Year Development Plan, 52, 81 Socal. See Standard Oil Co. of California stratigraphic petroleum traps, 174, 174 telephone exchanges, 142
“seconding” (lending employees), 62 soccer, 138 striking workers, 158–159, 160, 161, 184–186 television, 158, 172, 177, 177, 19
sedimentary rock, 74, 79, 79, 81, 87 social responsibility evolution, 164, 164, 165, 165 structural petroleum traps, 174 Temple High School, Philadelphia (USA), 72
sedimentologists, 177 Societe Franco-Iranniene Des Recherches, 47, 47 structure drilling, 81, 180 temporary housing, 88, 88, 78
seeps (oil seeps), 16, 16, 17, 18 Societe Industrielle Des Asphaltes Et Petroles De Lattaquie, 47, 47 study-abroad program, 190, 190 terminals, downstream operations, 185–186
Seflan, Ali, 178, 179 Society of Exploration Geophysicists, 145 Al-Subaey, Ahmed A., 153 Test of English as a Foreign Language (TOEFL), 71
Seismic Camps, 18, 18 Socony-Vacuum Oil Co. (Standard Oil Co. of New York), 29, 129. Al-Suba‘y, Wasib, 185 Texaco. See Texas Co., The
seismic technology, 106, 22, 22, 112–113, 114, 115, 118, 118, 119, 156 See also Arabian American Oil Co. (Aramco) subjects (providing for) goal of King ‘Abd al-‘Aziz, 3–4, 14, 37, 39, 90, 111, 120 Texas (USA), 23, 41, 124, 182
upstream operations, 170, 178 “soft” side of business, 155, 186, 135, 135 submarine loading lines, 90, 33, 33 Texas A&M College (USA), 137
self-development, 135–137 S-Oil Corp. (SsangYong Oil Refining Co.), 107, 107 submarine pipeline, 143 Texas A&M University (USA), 14, 145, 146
“sell my quota,” 79, 80, 88–89, 91 Solar Frontier K.K. (Showa Shell Solar), 161 succession planning system, 48 Texas Company, The (Texaco), 48, 78–79, 95, 124, 128, 129, 130–131,
Seminole, Oklahoma (USA), 23 solar power, 161 Suez Canal, 18, 94, 94, 120, 131, 196, 203–206, 210, 10, 23, 33 164, 177, 29, 41, 42. See also Arabian American Oil Co.
semiskilled/skilled labor, 175–176 Al-Somali, Ahmad “Mussolini,” 77, 77 Sulaiman, ‘Ali ibn Ahmad, 154, 154 (Aramco); Standard Oil Co. of California (Socal)
“senior” category, 159, 165 Sorbonne in Paris, 5 Sulaiman, Jasim ibn Muhammad, 154, 154 Texas Eastern Engineering Ltd., 52
senior staff camp, 165 source rock, 174 Sulaiman, Shaikh Abdulla, 138 thawbs, 102
Seoul University (Republic of Korea), 134, 134 sour gas, 183 Al-Sulayman, ‘Abd Allah, 34, 34, 50, 52, 52, 53, 53, 55, 56, 56, 90, theodolites, 85
“Sewage Acres” (Victory Gardens), 112, 113, 115, 115 sour oil, 152, 153 101, 142, 146, 146, 148, 162, 173 thermal cracking, 23
Al-Shahrani, Saeed H., 139, 139 South Africa, 138, 78 sulfur, 139, 139, 158, 183, 199 thermal cracking, refining process, 187
Shaikh, Noora, 152, 152 Southampton, England, 104 Sultan of Najd and Its Dependencies, 3. See also Al Sa‘ud, Thomas, John “Johnny,” 102, 103
Shakespear, William (Captain), 6, 7 Southeast Asia, 112 ‘Abd al-‘Aziz ibn ‘Abd al-Rahman (King) three-dimensional technology, 113, 113, 114, 115, 118, 118, 119, 156
Al-Shalfan, ‘Abd al-‘Aziz, 80 Southern Area Oil Operations, 82, 89, 142 Sumatra, 18, 23 upstream operations, 168, 168, 178–179, 179
Shanghai, 153 Southern Area Producing, 46 Sumitomo Chemical Co., Ltd., 163, 188, 192 thumper (vibroseis) trucks, 113, 113
Shari‘ah (Islamic law), 54, 7 Southern Area Projects, 128 Sun and Flare, 158 Thuwal, 163
al-Sharq Hospital in al-Khobar, 181 South Pier, Ras Tanura, 185 Al-Sunayyin, Muhammad, 63 Tigris River, 18, 69
Shauby (driver), 67, 67 South Rub‘ al-Khali Co. Ltd. (SRAK), 141 supertankers, 135, 205, 205, 23, 31, 31, 100, 100, 108, 108, 148–149, 149 Time magazine, 191, 19
Shaybah, 16, 18, 77, 89, 98–99, 119–120, 121, 122–123, 123, 125, Soviet Union (Russia), 5, 8, 18, 20, 21, 21, 40, 119, downstream operations, 186, 186 Titusville, Pennsylvania (USA), 19, 23
129, 129, 137, 138, 144, 150, 152 171, 193, 204, 4, 20, 43, 70, 141 Supplement Agreement, 98, 104, 127, 68, 95 TOEFL (Test of English as a Foreign Language), 71
upstream operations, 177, 177, 182, 182 Al-Sowayigh, Saleh, 148 supply and demand, 125–126, 128, 5, 23, 31, 32, 38, 95, Tokyo, 98, 153
Shaykh of Kuwait, 5, 7 Spain, 141, 182 118, 124, 128, 134, 142, 143, 152, 153, 160, 161 Tokyo Stock Exchange, 38, 38
Shedgum. 145, 145, 146, 174, 174, 31, 49, 53, 53, 57, 58, 63, 81, 87, 89, 158 Special Clerical Training Center, 59, 59 Supply and Transportation, 104, 108 toluene, 192, 193, 193
downstream operations, 185 Speers, Peter C., 149, 163, 207, 7, 7 suq (open-air market), 6, 6, 9, 10, 10–11, 38, 38, 184, 184, 185, 185 Total Fina, 125
operations data, 199, 199 Spindletop, Texas (USA), 23 suspicion of outside influence by King ‘Abd al-‘Aziz, 5, 14, 16, 35, 55, 98 Total of France, 141, 153, 189
Sheikh, Salwa S., 151, 151 spiral cable-drill bit, 82, 82 Sutherlen, George, 108, 108 Total Quality Management, 127
Shell in Jubail (SASREF), 188–189, 189 SPM (single-point moorings), 186 SWCC (Saline Water Conversion Corp.), 199, 199 Total Refining and Petroleum Co. (SATORP), 188–189
Shell Oil Co., 79, 40, 108, 124, 124 spudding, 73, 76–78, 144 “sweet” crude, 143 TPC. See Turkish Petroleum Co. (TPC)
Al-Shihabi, Nadia, 59 SRAK (South Rub‘ al-Khali Co. Ltd.), 141 sweetening, 190 trachoma, 180
shipping, 77, 83, 83, 108, 108, 155, 158, 158 SsangYong Oil Refining Co. (S-Oil Corp.), 107, 107 sweet gas, 183, 199 Tracy, Bill, 169, 169
downstream operations, 191 SS Exochorda, 69 “swing producer,” 31–32 Tracy, Frank, 80, 80, 15
operations data, 196 SSPC (Sinopec SenMei (Fujian) Petroleum Co. Ltd.), 153, 157, 157 Sydney Powers Award, 147 Tracy, Frank William, Jr. “Bill,” 15
Showa Shell Sekiyu K.K., 153, 157, 157 “stabbing board,” 82, 82, 100 Syria, 8, 8, 36, 131, 132, 134, 191, 196, 20, 22, 33, 38, 42, 43, 44 Tracy, James R. and Claudia, 77
Showa Shell Solar (Solar Frontier K.K.), 161 stabilization facilities, 182 Tracy, Margret, 15, 15
shrimping, 23, 23 Stalin, Joseph, 119 T traditional Saudi attire, 63, 63
Shubukshi, ‘Abd Al-Majid, 64, 64 Standard Oil Co. of California (Socal), 19, 20, 22, 24, 24–25, 25–26, 26, 27, 28, Taher, Abdul Hady, 7, 7 Traffic Safety Signature Program, 165
Sidon, 131, 132, 133, 133, 134, 135, 157, 33 29, 30, 34, 39, 41, 42, 43, 46–47, 47, 48, 48, 49, 50, 51, 51, 52, 55, 56, 56, Tahir, Sa‘id M., 46 Training, 213
Sidon price claims, 7, 10, 19 57, 57, 61, 63, 78, 79, 81, 86, 87, 98, 104, 128, 129, 130–131, 142, 16, 42, Taibah, Mahmoud, 190, 190 training. See education and training
Signal Hill, California (USA), 23 69, 166, 205. See also Arabian American Oil Co. (Aramco); California Al-Taifi, Haifa, 59 Training and Career Development, 34, 46, 77
Silicon Valley, California (USA), 77 Arabian Standard Oil Co. (Casoc); Texas Co., The (Texaco) Taiwan, 153, 157 train system, 136–137, 137, 140
Silurian age, 170, 170 war years (World War II), 98, 104 Tamayshah, 39, 39 Trans-Arabian Pipeline (Tapline), 122, 122, 128, 129, 131–135, 136,
silver riyals, 195, 195, 210, 10, 10 Standard Oil Co. of New York (Socony). See also Arabian American Oil Co. Al-Tamimi, ‘Ali, 181, 182, 182, 183 182–184, 191, 193, 196, 203, 205, 4, 7, 10, 33, 33, 38, 62
Sinai Desert, 204, 20 (Aramco); Standard Oil of New Jersey (Jersey, Exxon), 22, 129, 130, 131, 138 Tampico, Mexico, 23 Transjordan. See Jordan
Sinclair Exploration Co., 47, 47 Standard Oil of California (Chevron), 29. See also Arabian American Oil Co. (Aramco) Tanajib, 81, 86, 86, 105, 157 Translation, 75
Al-Sindi, Badria, 59 Standard Oil of Indiana, 23 tank crew (Saudi), 103, 103 Transportation, 77
Singapore, 153, 162 Standard Oil of New Jersey (Jersey, Exxon). See also Arabian American Oil Co. tankers, 90, 131, 143, 204, 204, 205, 205, 23, 33, 33, 81, 81, 83, 83, 108, 155 traps, 170, 174, 174
single-point moorings (SPM), 186 (Aramco); Standard Oil Co. of New York (Socony), 20, 22, 26, 129, 130, 131, downstream operations, 185, 191 travel difficulties in Saudi Arabia, 61, 62, 62, 63
sinkholes, 79, 79, 82 138, 200, 4, 5, 29, 36, 39, 41, 42, 64, 109, 125 Tanner, Lawrence “Larry,” 16, 63 traverse map, 69
Sinopec Corp., 141, 153 Stanford University (USA), 72, 212, 49, 77 Tapline. See Trans-Arabian Pipeline Treaty of ‘Uqayr (1922), 14
Sinopec SenMei (Fujian) Petroleum Co. Ltd. (SSPC), 153, 157, 157 Stapleton, T. “Vic,” 129 Tariki, Abdullah H., 207, 210, 210, 211, 211, 4, 6, 7 Tri District Quiz (TV show), 177
Sino Saudi Gas Limited, 141 Star Enterprise, 95, 95, 96 Tarut Bay, 157, 160, 160 “true Saudization,” 46, 48
Sirius Star (tanker), 155 Statfjord, 80, 80 Tarut Island, 62, 73, 165, 165 Truman, Harry (U.S. President), 143, 171
Six-Day War, 20, 20, 22 steel from USA for construction, 115, 121, 121, 125, 131, 132, 132 Al-Tawil, Aus, 117, 117 Al-Tu‘aimi, Saleh A., 47, 47
60/40 profit sharing, 4 Steel Worker (cargo ship), 140–141, 140–141 taxes collected by USA on Aramco‘s operations, 197, 198, 200 Tufley, Ralph, 168, 168
Skinner, E. A. “Ed,” 30, 30, 43, 81 Stegner, Wallace, 100 Tayif, 8, 41 Tulsa, Oklahoma (USA), 23
skyhook, 133, 135, 135 Steineke, Florence, Maxine, and Marian, 83 Taylor, Lee, 169, 169 Turaif, 134
slugs, 183 Steineke, Max, 24, 24, 63, 72, 73, 73, 74, 75, 75, 79, 81–82, Taylor, William F., 29 Turaiki, Saad A., 82, 142
“smart” wells, 144, 181 84, 84, 85, 87, 89, 102, 103, 104, 105, 105, 106 Al-Tayyar, Haytham Ahmad, 117 Turkey, 20, 21
Smith, Ernest, 76 legacy, 156–157 team sports, 138, 138 Turkish Petroleum Co. (TPC), 17, 17, 21, 22, 22–23, 26, 47, 47
Smith, Felix T., 130 “stepout,” 146 technological achievements of Saudi Aramco, xi Tuwaiq Escarpment, 79, 79, 81
Snamprogetti, 147 Stewart, Jim, 149 technological advances, 23, 144–146 Tuwaiq Mountains, 102
Snyder, Harry R., 174, 174, 175–176, 177 stock market (USA), 37, 37 technology transfer, 19–20 Twitchell, Karl S., 15, 15, 32, 32–33, 36, 37, 39, 39,
Snyder, Les, 137 Stoner, R. C., 204, 205 technology updates, 112–113 41, 43, 43, 46, 47, 48, 49, 50, 50, 201
Snyder, Thorn, 52 Strait, Donald, 179, 179 tectonic plates and oil, 74, 75 Twitchell, Nona, 48
Tehran Agreement, 39–40
234 index index 235
U U.S. Construction Industry Institute, 126 wildlife rescue operations, 106, 106
‘Udhailiyah, 44, 44, 82 U.S. Consulate, 116, 119, 119, 127, 127, 22 Williams, Guy “Slim,” 73, 73, 76
‘Ujman tribe, 85 U.S. National Security Council, 201 Williams Brothers, 134
al-‘Ula, 176, 176 U.S. Navy, 19, 115, 125–126, 162, 82 Williamsport, Pennsylvania (USA), 138
ULCCs (ultra-large crude carriers), 108 U.S. State Department, 198, 199, 200 Wilson, Ivan, 108, 108
ultimate recovery, 114–118 U.S. Treasury Department, 200 Wilson, Woodrow (U.S. President), 36, 40
ultra-large crude carriers (ULCCs), 108 USA. See United States of America (USA) wire-line logs, 170
Um Er Rus (Umm al-Rus), 71 USS Murphy, 120 Witherspoon, Erma and Marilyn, 83, 83
Umm al-Qura, 56, 98 USS Quincy, 94, 94, 120 women, professional, 75, 75, 77, 151, 151–152, 152, 158, 158.
Umm al-Qura University, Makkah (College of Shari‘ah), 173 Utah (USA), 182 See also girls’ education
‘Unayzah, 52 Al-Utaibi, Dhaifallah A. F., 63, 104, 105, 108, 112 first professional, 13, 13
“undulating plateau,” global oil production, 135 Al-‘Utayshan, ‘Abd Allah, 206 Woods Hole Oceanographic Institution, Massachusetts (USA), 164
United Arab Emirates (UAE), 206 ‘Uthmaniyah, 146, 82, 87, 89, 102, 158, 199, 199 workforce, 115–116, 118, 119, 119, 120, 120, 33–34. See also
United Arab Republic, 5 expatriate workforce; Italian workers; Saudi workers
United Kingdom, 35, 104 V history, 202–203
United Nations, 131, 132, 196, 206 value engineering, 128 labor unrest, 158–162, 184–186
United States of America (USA), 6, 20, 21, 22, 24, 29, 43, 48, 56, 62, 68, Van Leeuwen, I.J.S., 53, 53 reduction, 108–111, 115, 10, 23, 79–81
96, 97, 114, 114, 115, 119–120. See also Arabian American Oil Co. Van Peursem, Bob, 149 wages, 157, 158, 160, 184, 185, 186, 195, 195
(Aramco); California Arabian Standard Oil Co. (Casoc); cross-cultural Vardinoyannis family, 107 workman’s compensation, 101
relationships; Texas Co., The (Texaco); (World War II); specific Standard Vedakumar, Vedamuth J., 139, 139 World Bank, 126, 204
Oil companies Vela (sails), 83 World Oil Awards, 180
‘Abd al-‘Aziz’s (King) view of Americans, 55 Vela International Marine Limited, 77, 83, 83, 108, 108, 155, 158, 158, 191, 196 World War I, 6, 8, 8, 19–20, 23, 29, 36, 135
automobiles, 19, 19, 23, 126 Venezuela, 23, 24, 138, 198, 4, 5, 22–23, 78, 133 World War II. See war years (World War II)
conservation efforts, 80 Versailles Peace Conference in 1919, 40 WTI (West Texas Intermediate), 89, 162
crude oil reserves, 22–23 very large crude carriers (VLCCs), 83, 83, 108, 155, 191
diplomats in Saudi Arabia, 127, 127 vibroseis (thumper) trucks, 113, 113 X
domestic supply-demand gap for oil, 31 vice president of Aramco, first Saudi, 46, 46 Xiao, Jin Jiang, 145, 145
fuel efficiency standards, 40 Victory Gardens (“Sewage Acres”), 112, 113, 115, 115 xylenes, 192, 193, 193
gasoline rationing in, 114, 114, 126 Vidal, F. S. “Rick,” 149
gasoline shortages, 43, 43 visbreaking, refining process, 187 Y
Great Depression, 13, 24, 29, 40, 44, 52, 54–55, 89, 120 vision of King ‘Abd al-‘Aziz, 166 Yalta Conference, 119
Gulf War casualties, 103 VLCCs (very large crude carriers), 83, 83, 108, 155, 191 al-Yamamah, 172
importer of oil, 126 volatile organic compounds, 124 Yamani, Ahmed Zaki, 7, 7, 10, 13, 22–23, 24, 24, 37, 37, 38, 39,
oil discoveries in, 23 volunteerism, 164, 164 41, 42, 45, 46, 48, 63, 64, 69, 89
oil producer, 70 Yanbu‘, xv, ix, 54, 57, 58, 100, 100, 108, 150, 153, 158
refining and marketing alliance, 124, 124 W downstream operations, 185, 186, 188, 189, 190
Saudi Arabian Oil Co. (Saudi Aramco) and, 153, 161, 189, 196 Wadi al-Sahba, 102–103, 103 operations data, 198, 198, 199, 199
taxes collected on Aramco’s operations, 197, 198, 200 Wadi Muhrim, 41, 41 Yasin, Yusuf, 50, 53, 53
University of Cairo, 207, 7, 141 Wadi Nisab, 75, 75 Yassin, Shaikh Yusuf, 162
University of California, Irvine (USA), 33 wadis (riverbeds), 39, 150 “Year of Innovation,” 137
University of California at Berkeley (USA), 68, 149 al-Wafrah, 201 “Year of Self-Development,” 136
University of Damascus, 13 wages, 157, 158, 160, 184, 185, 186, 195, 195 Yemen, 36, 36, 37, 69, 79, 113, 142
University of Edinburgh, 172 Wahbah, Hafiz, 210, 211, 211 Yergin, Daniel, 135
University of North Carolina (USA), 77 Al-Wahhab, Shaykh Muhammad ibn ‘Abd, 7, 149 Yokohama, 40, 40
University of Petroleum and Minerals (College of Petroleum and War Production Board in Washington, D.C. (USA), 128, 129 Yokoyama, Masayuki, 97
Minerals), 173, 173, 179, 13–14, 20, 48, 72, 72, 74, 142, 157 warrior skills of King ‘Abd al-‘Aziz, 3, 5 Youngstown State University, Ohio (USA), 72
University of Riyadh (King Sa‘ud University), 173 Washington, D.C. (USA), 148, 196, 213, 160 Younis, Mohammed, 81, 81
University of Southern California (USA), 77 wastewater recycling, 109 Youth Welfare Presidency, 94
University of Texas (USA), 208–209, 145 water importance, 15, 15, 39, 40, 40, 41, 41, 43, 43, 134, 136, 136, 137, 170 Yushatly, Martes, 88
University of Tulsa, Oklahoma (USA), 88 water injection wells, 180
upstream operations, 93, 170–183. See also downstream operations; water testing, 179, 179 Z
operations data Weathers, L. T. “Stormy” (Colonel), 120 Zagros Mountain, 75
drilling and reservoir engineering, 180–181 Web-based Operator Training Simulation, 136 Al-Zaid, Salih Sa‘d, 159, 159
exploration, 176 Webster, Ken, Mildred “Mimi,” Susan, and Judy, 164, 164 Al-Za‘im, Husni, 132, 191
fossil record, 176–177 Weekly Caravan, The (Al-Qafilah al-Usbu‘iyyah), 158 al-Zamil Heavy Industries, 147
gas production and processing, 182, 183 Well No. 7 (Dammam Dome), 76, 76, 78, 82, 83, 84, Zarka, 33
geological timeline of Saudi Arabia, 172 86, 87, 87, 89, 90, 95, 99, 105, 74, 74, 166 Zauruk (tanker), 155
oil, origins of, 74–75, 170–171 Well Samples and Laboratory Unit (Core Store), 117, 117 Al-Zawawi, Yousef, 183, 183
oil and gas fields of Saudi Arabia, 175, 175 Western culture. See cross-cultural relationships (Saudi and Western) Zeeco, 89
oil production and processing, 182 Western wear, 102, 102 Zinola, Ed, 35
petroleum traps, 170, 174, 174 Westhampton, New York (USA), 151, 151 Zuluf, 16, 36, 52, 58, 58, 82, 86, 103, 103
reservoir characterization, 179 West Texas (USA), 23
reservoir nano-agents (resbots), 180 West Texas Intermediate (WTI), 89, 162
seismic imaging, 178 Weyburn-Midale CO2 Monitoring and Storage Project, 158
stratigraphy of Eastern Saudi Arabia, 173 whale oil, 17
Upstream Professional Development Center, 179 Whipple, Sam, 164, 169, 169
al-‘Uqayr, 3, 5, 8, 9, 63, 65 White, Allen C., 24, 24, 63, 63, 64, 71
al-‘Uqayr (Uqayr Conference), 3–4, 4, 12, 12 White House, Washington, D.C. (USA), 190, 190
al-‘Uqayr agreement, 14–16, 35, 42, 43 Wickstrom, Butch, 100 This book is printed on paper manufactured from a mixture of fibers,
Urdu, 196 wildcatters, 76 including sources certified by the Programme for the Endorsement of
U.S. Army, 77 wildcat wells, 180 Forest Certification (PEFC) and the Forest Stewardship Council (FSC).
238 energy to the world : Volume two endnotes 239

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What is the book about?

What is the book about?

What challenges did Aramco face in its early years of operation?

What challenges did Aramco face in its early years of operation?

ENERGY TO THE WORLD:

ENERGY TO THE WORLD:

THE STORY OF SAUDI ARAMCO

Energy to the World

Energy to the World

Supertankers load crude

Copyright First Edition Volume One Volume Two

An exploration camp in the

The 1960s marked a period of accelerated

Oil in the Arab States

In 1962, an all-Saudi crew was

First Professional Woman

A drilling crew tightens the con-

As Time magazine reported:

A contingent of the Saudi National

Small fish picked up in shrimp nets

Ras Tanura, North Pier, 1970.

The 1970s proved to be a time when Aramco’s

Aramco’s computers, such as the

Barge 136, nicknamed the “Queen

“Bulldozers Were Going Twenty-Four Hours a Day”

Operators in the control room of

Construction of the East-West NGL

The Zuluf gas-oil separation plant

One of Aramco’s most challenging

Aramco CEO Frank Jungers, right,

Following months of negotiations, the government announced in February 1979 an

The East-West Crude Oil Pipeline, 1985.

On May 16, 1983, Saudi royalty and dignitaries,

Aramco-sponsored students gather

The transformation of Saudi Arabia Professional Development Program

Prosperity Well Ameera A. Al-Mustafa, left, a

The second wellhead from

Nabilah M. Altunisi, shown here in

Aramco’s hiring initiatives during

The rapid pace of construction is

A drilling crew works in the Safaniya

Aramco brought six gas wells, such

Molten steel provides the fireworks

A new crude oil pipeline snakes its

Children’s Art Contest

Rising to the Challenge

The increasingly global role played by the

A Saudi tank crew pauses for a

In 1995, the supertanker Pherkad Going Green

Golfers enjoy a round on Dhahran’s

The Core Store

Aus Al-Tawil, left, discusses a

Ghawar, the world’s largest oil field,

Saudi Aramco’s state-of-the-art parallel-processor computer system provides a much

Discovered in 1968, the Shaybah oil

King ‘Abd Allah, then Crown Prince,

Hawiyah Gas Plant, shown here under

The Shaybah project was a proving

Achieving the Vision