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Volume 24, Number 3May/June 1973

In This Issue

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Aramco ‘72

Illustrated by Penny Williams-Yaqub

For the Arabian American Oil Company (Aramco), 1972 was a big year. How big was a key subject in the annual Review of Operations which came off the presses in Saudi Arabia in April and released this month.

According to the Review, an illustrated Arabic-English summary of major company activities, Aramco in 1972:

Boosted production to an average of 5,733,395 barrels of crude oil a day (an increase of 27.5 percent over 1971) and during the year produced a total of more than 2 billion barrels.

Increased proven reserves by a net 2.8 billion barrels for an estimated total of nearly 93 billion.

Drilled wells at the rate of one well every 2.1 days.

Installed nearly 21 miles of oil and water pipelines every month.

Added 1,000,000 barrels a day of gas-oil separation capacity and 2,000,000 total barrels in storage capacity.

Increased electric power generation capacity by 25 percent.

Impressive statistics are nothing new for Aramco. Ever since the 1940's, when World War II military demands and postwar reconstruction stimulated the first expansion of production, continuing growth has almost always been the norm. But even Aramco, which is Saudi Arabia's chief producing company, was a bit breathless as, coming into 1973, it totted up figures showing that in the production of oil only the United States with about 9.5 million barrels a day, and Russia with an estimated 7.9 million barrels a day, exceeded Saudi Arabia's daily output. The figures also showed that in exports Saudi Arabia led the world (and that Aramco alone loaded 3,734 ships with 1,877,118,701 barrels of crude oil and petroleum products, a jump over 1971 of 31 percent).

Growth of that magnitude, of course, would have been impossible without a corresponding expansion of facilities. Several years ago, therefore, Aramco began to plan a major program of construction which, by year's end, included such projects as these:

At Ras Tanura, Aramco's oil port, a fractionating plant and butane refrigeration plant were installed which, together with a new de-ethanizer column at Abqaiq, a production center, were designed to enable the company to process up to 89,000 barrels a day of liquefied petroleum gas, up from the previous capacity of 50,000 barrels per day.

At Abqaiq, one stabilizer column was completed and four were under construction. The five columns will have the capacity to process 2,170,000 barrels of crude oil a day. A gas-oil separator plant and the center's 10th steam boiler were also being built.

At Shedgum and 'Ain Dar, in the huge Ghawar Field south of Dhahran, two gas-oil separator plants were completed and an existing plant was expanded, together adding 550,000 barrels daily to production capacity. Overall, in the Ghawar Field, about 140 miles of pipelines and 90 miles of electric power lines were installed.

For the offshore Berri Field, production capacity was doubled to 600,000 barrels daily with construction of a gas-oil separator plant at Abu 'Ali, an island in the Gulf 50 miles northwest of Ras Tanura, and a gas-oil separator, stabilizer and a 1,000,000-barrel storage tank at Ras Tanura.

Much of the expansion focused on such existing or potential shipping facilities as:

Ras Tanura, now the world's busiest oil port, where a fourth Sea Island added two tanker berths (Aramco World , March-April. 1973).

Zuluf, a deep-water terminal 40 miles off the coast of Saudi Arabia, where new facilities include an offshore gas-oil separator plant, designed to process 480,000 barrels daily, the F. A. Davies, a 1,800.000-barrel tanker moored in the Gulf to serve as a floating storage tank; and a buoy mooring a mile away, from which tankers can load oil from the Davies via underwater lines.

Ju'aymah, 15 miles northwest of Ras Tanura, where Aramco's new deep-water port will be built. Designs, nearly completed at year's end, call for a new tanker terminal that promises to be one of the largest single projects ever attempted by Aramco.

The pattern of growth was also apparent in the work force which, by the end of 1972, numbered 11,282 (9,211 Saudis, 1,031 Americans, 1,040 other nationalities). To insure that they could cope more efficiently with the natural increase in responsibilities, Aramco's Training Department provided job-related training programs for 2,200 of the employees and enrolled 920 trainees in the two-year-old apprentice program which prepares workers for employment in crafts, plants and offices. In addition, 174 employees attended one or more of 16 management training courses, and another 100 were studying in colleges, universities, technical institutes and other schools, 90 of them in the U.S.

As Aramco's needs increased so did its dependence on local industries and services. In 1972, for example, Aramco signed 7,300 contracts with Saudi Arab firms compared with 1,800 the year before, and its Local Industrial Development Department stepped up its efforts to assist Saudi entrepreneurs willing to start or expand enterprises valuable to both the public and Aramco. Under the LIDD program the company provided technical guidance or financial assistance to more than 40 local businessmen for such enterprises as valve repair, electronic maintenance, air-conditioning overhaul, water-well drilling, heavy duty equipment overhaul and drill pipe thread-cutting, a dental clinic and a school for welding. Altogether these enterprises employed 4,800 people and produced goods and services valued at $40,500,000.

In one special case Aramco also provided guarantees for loans totalling $2,125,000 to help launch a $5,600,000-hollow glass factory. To Aramco planners this factory was an excellent example of the kind of industry which can flourish in Saudi Arabia. Its products—chiefly bottles—will supply the growing soft-drink bottling industry; its raw material, mostly sand, is readily available in central Arabia, and it has a cheap source of energy—natural gas from Aramco oil fields.

Growing, in fact, affected nearly all of Aramco's programs. Aramco's agricultural advisers, for example, reported that under a continuing program of modernization of Saudi farming, some 128 specialized farmers who have received Aramco help recorded, along with their supply agencies, a $5,721,000 gross income in 1972, up 60 percent over 1971, a new record.

Even the company's donations and contributions reflected the pattern. As part of its contribution to education in Saudi Arabia—under which it constructs schools for the public school system and pays for operation and maintenance costs—Aramco completed the 45th school, and expanded another, for a cumulative total of $44,600,000. Its donations program—to educational, philanthropic and charitable causes—reached a total of $2,531,000 for the year.

This article appeared on pages 8-11 of the May/June 1973 print edition of Saudi Aramco World.

Check the Public Affairs Digital Image Archive for May/June 1973 images.