Saudi Arabia’s first natural gas storage project becomes operational

RIYADH: Saudi Arabia has officially launched operations at the Hawiyah Gas Storage facility, marking its first project dedicated to storing natural gas through the injection of processed fuel. Developed by Aramco, the facility is designed to reintroduce up to 2 billion standard cubic feet of natural gas per day into the Kingdom’s Master Gas System, an extensive network of pipelines that connects key production and processing sites to customers nationwide.

This initiative is set to help meet the rising energy demand in the country, particularly during peak periods, as announced by the Ministry of Energy on X. The project plays a crucial role in managing seasonal demand fluctuations, supporting the Liquid Fuel Displacement Program, and reducing carbon emissions.

Launched as part of Saudi Vision 2030, the initiative aims to displace 1 million barrels per day of liquid fuel across the utilities, industrial, and agricultural sectors by the end of this decade. Renewable energy and natural gas are the two primary alternatives identified, enabling the Kingdom to generate 50 percent of its electricity from renewable sources.

Saudi Arabia is actively promoting the use of environmentally friendly gas through a government-led initiative spearheaded by the National Center for Environmental Compliance. In partnership with local and international organizations, this initiative supports private sector factories in transitioning from production lines that create environmentally harmful products—those detrimental to the ozone layer and contributing to global warming—to more eco-friendly alternatives.

Saudi Aramco, the world’s largest oil producer, is positioning itself as a key player in the liquefied natural gas market. In its first international venture into LNG, the energy giant acquired a minority stake in MidOcean Energy from EIG Global Energy Partners for $500 million last year.

This agreement strengthens the existing partnership between Aramco and EIG, which was part of a consortium that acquired a 49% stake in Aramco Oil Pipelines Co., an Aramco subsidiary, in 2021. MidOcean Energy is currently in the process of acquiring interests in four Australian LNG projects, with a growth strategy focused on creating a diversified global business. This strategic partnership with MidOcean Energy marks Aramco’s first international investment in LNG.