Oil Production In Saudi Arabia Essay Example | Topics and Well Written Essays - 500 words

Oil Production In Saudi Arabia - Essay Example With these statistics, it is undeniably true that Saudi Arabia’s contribution in the energy industry position’s herself as key player in the global economy. This paper therefore discusses the oil production in Saudi Arabia through understanding its history and development over the years. Statistics derived from organization of the petroleum countries (OPEC) in 2014 showed that Saudi Arabia’s value of exports from petroleum related products to be about $ 321, 723 million, and its current crude oil reserves standing at 265,789 million barrels. In a whole ,oil related products, natural gas reserves constitute about 8317 billion cubic meters. Pushed by the demand for oil of about 1000 barrels per day , Saudi Arabia has increased its production capacity to be about 9637 barrels per day; this is about 2507 barrels per calendar day refinery capacity. Last year, Saudi Arabia’s export earnings came from natural gas with 100030 million cubic meters exported globally (Bronson, 56). Before Saudi Arabia controlled its oil industry, the first king of Saudi Arabia Abd al Aziz Ibn Abd granted oil concession in 1923 to British investment groups who exploited, and utilized the concession granted. It is after the discovery of first oil reserve in 1938 that the concession agreement was changed to Aramco’s concession. It allowed an equal haring of profits between the company and the government on a fifty-fifty basis. With the discovery of large quantities of oil reserves in 1945, the use of pipeline was in evitable. The trans-Arabian pipeline company came into existence owned by Aramco’s group. After completion of the Tapline pipeline in 1950, it did collect oils from fields, and it was able to handle 480, 000 barrels per day. Tapline continued to operate with a number of challenges coming from within and externally and in 1982; it was forced to stop its operations in Saudi Arabia (Branson, 45). After 1982 and