The Oil Drum

I missed posting this when there was a discussion on Manifa in an earlier Drumbeat...

My understanding is that some/most of the Saudi "excess capacity" is from this field. From Simmons I learned that it is heavy sour crude with significant Vanadium content. The Vanadium requires special refining capabilities. An earlier poster noted that the Vanadium content was comparable to some of the Mexican crude that is currently refined in the U.S. I would fathom that the world refining capacity for vanadium laced crude is limited and supply can be met by Mexican exports. Hence, no market for Manifa crude.

The Saudis are planning their own refining complex for Manifa. I don't have the proposed capacity. I read two things into this. From a business perspective, this only makes sense. The output of Manifa can be used for internal comsumption and the added value from refining kept in-house. This also implies that internal consumption currently being met from exportable stock can be freed up as a revenue source. This is all very obvious. The unwritten conclusion that I draw is that if Saudi Arabia is vigorously pursuing Manifa at this time then there is clearly a dearth of other investment options open to Aramco. The writing is clearly on the wall.

I don;t have the figure handy showing KSA production ove the past few years, Khebab, anyone? My reading is that Saudi's pumped flat out for a short period, voluntarily cut back for about 15 months and ramped back up to peak which held about 4-5 months and has turned over. We are seeing a real decline.

Finally, my 2 cts on the recent purge. A dramatic improvement, TOD is readable again. I only wish that we could find a nae-sayer who could be more civil (and have the requisite thick skin!)