Expansion on agenda for Bahrain energy industry, MEED conference told

Bahrain’s energy industry expansion plans include projects worth more than $20bn in total, the MEED Bahrain Energy Forum in Manama was told this morning. The conference was told that the projects being developed include;

  • Continuing investment in upstream oil and gas expansion projects including drilling
  • A deep drilling project designed to find gas at depths of 12,000 feet. Oxy of the US has the contract to undertake the project which is due to begin by the end of May
  • The third train at the Bahrain National Gas Company (Banagas), the national LPG producer
  • The expansion and modernisation of the Bapco refinery, the oldest refinery in Arabia which first started producing in 1936. This project will increase the capacity of the plant to up to 460,000 b/d from 270,000 b/d and raise the proportion of liquids that can be used in downstream chemical industries
  • A new pipeline linking Saudi Arabia and Bahrain to replace the existing pipeline and increase the capacity of the link to 350,000 b/d
  • A new 1,500MW power station, which could be developed as an independent power project
  • An LNG import project that could have capacity of 400,000 cubic feet a day. Requests for proposal to develop the project on a built operate transfer (BOT) basis are to be issued soon.

Bahrain’s oil production including its share of the output of the Abu Safaa field in Saudi Arabia is 200,000 b/d, of which about 50,000 b/d is produced in Bahrain. Upstream investment has significantly increased gas production from the Bahrain field. “Bahrain is producing more gas than it can process,” NOGA Holdings chief executive Shaikh Mohamed said. “A lot of this is being re-injected.” Non-associated gas production from the Bahrain field is now 2.3bn cubic feet a day. This compares with 1.5bn cubic feet a day in 2009. “A third train for Banagas is something we want to get started,” Shaikh Mohamed said. “We are studying this project and, in a few months’ time, Banagas will decide whether to invest.” “We have a huge development programme for the refinery,” Shaikh Mohammed said. “The expansion is about doubling the capacity. We are doing front engineering for the new pipeline to Saudi Arabia. Construction should start this year.” “Bapco is going to produce a lot of naphtha,” Shaikh Mohammed said about the change in the output balance that will result from the Bapco modernisation and expansion. This will support Bahrain’s plans to expand downstream petrochemical industries. Deputy chief executive of Bahrain’s Electricity & Water Authority (EWA) Adnan Fakhro told the conference that peak electricity demand in the summer of 2013 was just under 3,000MW. This compares with installed capacity of 4,000MW. He said that on present demand trends, Bahrain will need new capacity from 2017. “Al Dur phase II will have capacity of 1,500MW and a cost of $1.5bn,” Fakhro said. “It will probably be combined cycle. There is a debate about whether it should be an IPP or EPC.” Investment in water desalination capacity is less pressing and could be done at a later date, Fakhro said.