RIYADH, Sept 29: Producing more than five million barrels a day for decades now, the Ghawar oil field of Saudi Arabia, the world’s largest oil field, is crucial to global energy balance. With oil markets in turmoil, the kingdom is expected to meet a quarter of the increasing global crude thirst in the near future.

Currently Riyadh accounts for almost one-fifth of global crude exports.

With focus on Saudi Arabia, Ghawar holds an unparalleled significance to future global oil supplies. Stretching for more than 150 miles beneath the desert, it is the largest known global crude deposit. It produces twice as much oil than any other field in the super-giant category.

Ghawar is hence crucial to continued Saudi production and meeting the galloping global requirements. People like Matthew Simmons have been arguing for years now that Ghawar is on decline. That is a cause of major concern to the energy fraternity.

Stuart Staniford is another sceptic. He recently undertook computer study of the publicly available information on Ghawar. After going through the available data on Saudi production before 1980, Staniford infers that the depth of the remaining oil column in northern Ghawar at that time was about 500 feet.

And with water level rising by about 18.4 feet per year, Staniford extrapolates that the northern part of Ghawar by now is quite depleted.

Staniford also used a detailed computer simulation of the reservoir, based on its size and shape, the porosity and permeability of its rock, and the assumed oil-extraction rates. And then he concludes that production from northern Ghawar has already peaked.

However, Staniford concedes that the southern Ghawar still holds a lot of oil, agreeing that the kingdom’s push to find new fields could still bear fruit. However, Staniford underlined that northern Ghawar was developed first, only because it was by far the most promising field and hence its production cannot be easily replaced.

Not every one agrees to this doomsday scenario. Nansen Saleri, the former head of reservoir management for Saudi Aramco, who now heads the Quantum Reservoir Impact, points to technological advances in quenching the global thirst.

He specifically referred to the new technology adopted by Aramco while developing the Haradh oilfield in south Ghawar, he termed them as unique and a model for future developments, heralding a new era in reservoir management.

The Haradh III project, encompassing the southern third portion of Haradh, came on-stream in February 2006, adding 300,000 bpd of Arabian light crude production capacity to Ghawar. The project took 21 months, and entailed construction of a grassroots surface-facility network, integrated with a complex sub-surface development program.

Maximum Reservoir Contact (MRC) wells, smart completions, geo-steering, and the latest information technologies were part of Haradh III, at a scale and complexity unprecedented for Saudi Aramco and arguably, for the global upstream industry.

From a technology-impact perspective, Haradh is interesting because the field was developed in three phases over a decade. The total Haradh production capacity is 900,000 bpd, with equal contributions from the three sub-segments and with progressively more complex sub-surface technologies.

Against a backdrop of many international upstream projects straining to achieve their target production levels and intended plateaus, Haradh III reached its planned production capacity of 300,000 barrels per day well ahead of schedule, and the field’s performance tot his day exceeds virtually all pre-project goals.

Despite speculations to the contrary, the Ghawar era still appears to be far from over. As is philosophically said that coal did not end, coal era came to an end, similar appears to be the case with oil too.