When France's Total officially pulled the plug on its gas exploration adventure in Saudi Arabia last week, it was the first overt sign of disaffection with the ongoing gas program undertaken by four international joint ventures in the remote Rub al-Khali desert. But the news isn't much better from the other ventures, and concern is spreading that this public-private initiative may do little to solve the kingdom's internal gas supply problems -- much less provide gas for export (WGI Feb.27,p1).

Total, which activated a withdrawal clause in its contract after three consecutive noncommercial wells from the South Rub al-Khali (Srak) consortium, felt that failure of the initial wells boded poorly for prospects in the future, industry sources familiar with the joint venture said. Srak, which was formerly owned 40% by Royal Dutch Shell and 30% each by Saudi Aramco and Total, drilled its third dry well late last year (WGI Nov.22'06,p2).

Shell and Aramco admit that they, too, are disappointed with the first well results, but say that they don't feel the three wells are enough to accurately judge their acreage, which covers around 210,000 square kilometers on two different concessions: Areas 1 and 2.

Those two companies will now each own 50% of the venture. In an indication that Shell may have its own qualms about the venture, Aramco -- which holds only 20% in the other four international consortia exploring for gas in the Rub al-Khali -- will take on more risk and financial burden for the remainder of the seven-well exploration program, which runs until January 2009.

"The joint venture is determined to complete the remainder of its exploration program," Abdulaziz al-Judaimi, the Aramco-nominated chairman, said in a statement last week. Srak is to start this month drilling its fourth well, Kidan-6, in Area 1, and will likely drill its fifth well in Area 1, as well. The other three previous wells were in Area 2.

No commercial discoveries have been announced so far by the other three consortia, either: Russian Lukoil-led Luksar, China's Sinopec-led Saudi Sino Gas (SSG), and the EniRepSa venture linking Italy's Eni with Spain's Repsol YPF. In all, the four ventures have drilled around 10 wells with no commercial results to speak of, although most have found some gas.

Luksar, which has five wells either drilled or in progress, discovered 620 million barrels of oil equivalent (3.5 trillion cubic feet) a year ago at Tukhman-3; and SSG, which has drilled four, has found gas in more than one of its wells. Eni and Repsol have also reported trace amounts of gas.

Only Srak has found empty reservoirs. Even so, Srak maintains it is confident about the move to Area 1, where Aramco has stumbled on gas in the past and which is close to the hydrocarbon-rich border with the Untied Arab Emirates and Saudi Arabia's own large Shaybah oil field.

More to the point may be the question of whether gas -- even if discovered -- can be extracted under the present upstream agreement. Luksar's Tukhman-3 is understood to be on the borderline between a gas and an oil discovery. If it's deemed to be an oil find, the field reverts to the Ministry of Petroleum under the terms of the contract. The Russian company submitted a development plan to the ministry last year, but has received no reply.

SSG found tight gas in its Sheeh-2 well, but poor flows have required additional drilling. Srak's target reservoirs in Area 1 have high hydrogen sulfide (H2S) content. The consortia must sell any gas to the government at official rates of 75¢ per million Btu, but can lift and sell associated liquids -- condensate and NGLs -- to cover development costs and make a pre-agreed level of profit.

Lukoil, Sinopec, Eni and Repsol have no right to withdraw after a string of unsuccessful wells comparable to that just exercised by Total, so all are putting a brave face on finishing their five-year exploration programs, which expire in March 2009. Srak has officially asked the ministry for an extension of around 18 months, and other joint ventures have reportedly done the same -- not wishing to just put holes in the ground to meet their drilling commitments.