US oil major Chevron could deploy a technique to boost oilfield output across the neutral zone between Kuwait and Saudi Arabia in 2017, a top Chevron executive said on Tuesday. If successful, the technique could be rolled out worldwide and add billions of barrels to global reserves, said Guy Hollingsworth, Chevron's president for exploration and production in Europe, Eurasia and the Middle East. “We could go to full-field in 2017,” Hollingsworth told reporters on the sidelines of an energy conference in Abu Dhabi. Chevron is testing the impact of steam flooding in the oilfields in the neutral zone to help boost output of heavy oil. Steam raises the temperature below ground and loosens up crude that is otherwise difficult to pump. The US firm would begin the second stage of the testing program in July, Hollingsworth said. This stage, pumping steam underground through 16 injection wells to produce crude from 25 wells, would run for three years and give a better idea of how much recovery could be improved through the process, he said. The first stage, already completed, used just one injection well and one producing well. It was unclear from that how much recovery could be improved, he said. Saudi Arabia and Kuwait share the estimated 550,000 barrels per day (bpd) output from the Neutral Zone. Kuwait Gulf Oil Company, operator on the Kuwait side, detailed plans last month to invest $11 billion with Saudi Arabia to boost output to 900,000 bpd over the next 20 years in the zone. Saudi Arabia renewed Chevron's concession in the neutral zone last year. Chevron's net production after royalties is 110,000 barrels per day, mostly heavier grades that trade at a discount to benchmark West Texas Intermediate oil. Meanwhile, Dow Chemical Co's and ConocoPhillips' major joint ventures in Saudi Arabia face delays, a Saudi state oil company official said on Tuesday. A giant petrochemical plant that Saudi Aramco planned to build with Dow Chemical Co would start up in 2015, Judaimi said. That was about two years behind the initial schedule. Engineering and design for that plant should be completed in 2010, Abdulaziz Al-Judaimi, vice president for new business development at Aramco, told an energy conference in Abu Dhabi. Dow's planned investment in the plant would be the largest single investment by a foreign oil company in the Saudi energy sector. The price tag for the plant was at least $20 billion. Saudi Aramco and ConocoPhillips plan to start up their joint venture Saudi Yanbu refinery in late 2014, Judaimi said, a year later than previously scheduled. The world's top oil exporter has delayed two joint venture refineries, the other with France's Total, as it looked to take advantage of falling construction prices to drive down costs. The Kingdom has also delayed plans to develop the 900,000 barrels per day Moneefa oilfield due to the slump in global oil demand from the recessionary economy. The refineries will process oil from Moneefa, so construction is tied to the field's development. “We plan to award engineering, procurement and construction contracts in 2010 and to start up in late 2014,” The 400,000 barrels per day (bpd) Yanbu refinery on the Red Sea coast is one of four that the world's top oil exporter plans to build to boost domestic refining capacity to around 3.8 million barrels per day (bpd) from 2.1 million bpd. The two firms halted the bidding process for contracts for Yanbu in November amid uncertainty in financial markets and as the cost of raw materials plummeted. Estimates for the cost of both the joint venture refineries had risen to around $12 billion from initial budgets of $6 billion. The second 400,000 bpd joint venture refinery between Aramco and France's Total at Jubail would start up in 2013, Judaimi said. Contracts to build that plant would be awarded later this year, he added. Aramco and Total have said they would like to drive the cost of the plant below $10 billion. Oil prices mixed Oil prices, after spiking to the highest levels this year in New York ended mixed. New York's main futures contract, light sweet crude for delivery in July, fell three cents from its closing price on Monday to end at $68.55 a barrel after briefly hitting $69.05. London Brent North Sea crude for July delivery rose 20 cents to $68.17.
