Aging Gulf oil and gas works at ‘critical’ point


By Francesca Astorri

8 July 2013

A leading energy expert has warned that Gulf states need to invest more upgrading their oil and gas facilities as some are operating past their maximum capacity or beyond their lifespan, creating a potential risk to production, public safety and the environment, it has been reported.

“Many existing operating assets in the region — in particular in offshore locations — are 30 to 40 years old and are producing at their maximum installed capacity, often under harsh conditions” James McCallum, CEO and co-founder of Senergy, a global energy services company covering hydrocarbon exploration & production, told the Gulf Times newspaper.

McCallum also warned that many wells are being used beyond their lifespan, which could prove problematic down in the future.

“Ensuring asset integrity in the oil and gas industry is particularly critical because failure to do so jeopardises production, people’s safety and the environment, and thus may have a negative impact on companies’ operations and profitability,” he said.

As global energy demand is forecast to double by 2050, according to the Paris-based International Energy Agency (IEA), seeking to extend the working life of existing assets to maintain output may be the wrong answer, he believed.

With over 20 years of experience in engineering, construction and business management, McCallum argued that while some firms in the oil and gas sector were addressing this issue, “this approach isn’t universally applied in the Middle East yet,” he said.

He believed the Gulf needed to replicate the UK model and start investing large scale in the future of its oil and gas industry.

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