Vol. 59 No. 1

January 2007

Sadad Al-Husseini, Executive Vice President for E&P (retired), Saudi Aramco

What do you think are the most important changes or advancements SPE has made during your 25-year tenure with the Society? The most important developments the oil and gas industry has made?

SPE and the oil industry have always been two sides of the same coin. As the industry grew in technology, complexity, and geography, so did SPE match it with its own growth and development. In many ways, the incredible complexity of challenges that we have faced over the last 3 decades drove us to integrating complex technologies from across a whole spectrum of disciplines. This went way beyond geology and geophysics to include breaking advances in information technology, oceanography, robotics, communication, chemistry, and the full range of environmental sciences. This compressed process of knowledge, technology transfer, and integration is probably the most important development that I have seen in the industry in recent years.

How critical a role do professional societies, such as SPE, play in promoting professionalism and high ethical standards in the global oil and gas industry?

The vital role of energy in driving the global economy is something we are all pretty well aware of. Not surprisingly, this means that professionals are always under pressure to deliver new projects or production capacity under harsher and harsher conditions. More often than not, this is exacerbated by massive financial exposure and little or no margin for error.

This situation creates pressures to look for compromises in those areas that may have little immediate impact but may or may not be appropriate. That is true whether you are working with unproven reserves and resource estimates, anticipated production rates, reservoir depletion strategies, the management of hazardous byproducts, or the conservation of natural resources. These are universal issues that can surface in Alberta’s tar sands, the Niger River delta, the Arabian Gulf, or the Sakhalin peninsula.

When you have that kind of pressure, professional peer support along with well-established professional standards and a tradition of operational transparency are the best insurance for sustaining excellence and integrity in our industry.

What role can SPE play in helping to ensure that the industry has the technology and the technical talent it needs for the future?

The oil and gas industry today provides some of the most exciting and rewarding employment opportunities that any young person could ask for. Unfortunately, we have suffered in the past from too much volatility and too many mergers and acquisitions. Management has had to focus more on budgets and Wall Street than on oil and gas fields.

At Saudi Aramco, we sponsored hundreds of Saudi Arabian high school graduates with full scholarships to the best technical universities in the U.S. just to deal with this problem.

Today, SPE needs to be the real voice of the industry. It needs to actively promote the industry at the entry level with an accurate depiction of what we all believe in. I am delighted to see 2007 SPE President Abdul-Jaleel Al-Khalifa bringing a powerful focus on this issue of talent availability and human resource development.

Oil and gas are not the source of all ecological evils. In fact, they are the main solution for virtually all global energy challenges. That message needs to get through to the public, and SPE is one of the most effective candidates for the job.

What were the major influences that guided SPE from primarily a North American organization to a truly international one?

The move of investments and production capacity away from North America starting in the mid-1970s made it necessary for U.S.-based professionals to redirect their focus abroad. As their jobs moved, they took with them their social traditions and networks, including their network of academic centers, their professional values, and their access to professional societies. This was a real boost for professionalism throughout the world, and the benefits to international operators made SPE welcome virtually everywhere in the global arena.

How do you assess SPE’s growth potential in the Middle East? What should it be focusing on to attract members in that region?

The huge oil and gas reservoirs in the region can become only more peculiar and complex with time and maturity. They are already generating a wide range of technical challenges that are often similar to the challenges encountered elsewhere in the world but on a scale that dwarfs previous experiences.

SPE plays an important role in addressing these challenges. It needs to continue to set itself apart from specific commercial interests and continue to offer its depth of expertise and knowledge across the industry. I am confident that the search for new and improved engineering solutions within the giant oil and gas fields of the Middle East will sustain a vibrant SPE community for many decades to come.

How should SPE move forward into the future?

Professional members of SPE need to take on more regional leadership roles and tap into the expertise of the Society to address their own needs. For example, I have found that local forums on specific technical challenges can be particularly effective in generating relevant solutions while also bringing people together to form lasting friendships and associations. Knowing that SPE’s international network is there to provide support gives each region the confidence to tackle complex challenges, knowing it can call for help when needed.

As world demand grows, many assume that Saudi Aramco and other national oil companies (NOCs) will be able to meet global energy requirements efficiently and cost-effectively while maintaining high standards of stewardship and transparency in managing their finite resources. Is this unrealistic? How will NOCs handle this burden?

Saudi Aramco is fortunate to have a very supportive government in Saudi Arabia and is a company that loves to be challenged. However things work out, it will always do the best job possible. World oil demand, however, is a challenge that goes way beyond Aramco’s capability and resources; it is a challenge that needs to be addressed by the whole industry.

We can meet the world’s energy requirements only by working with consumers and producers alike on all energy fronts. This means more commercialization of marginal energy supplies, more fuel efficiency, more use of alternative fuels, more intense technology applications, more flexibility in refining capacity, and more innovation in end uses such as basic land, sea, and air travel.

The worst thing that could happen is to confuse ourselves and the public with too much spin about unlimited energy supplies at cheap prices, alternative fuels on a global scale, or energy independence in a matter of years. That kind of thinking simply dilutes our focus, defers the tough solutions that are needed today, and sets us all up for more future shocks and economic disruptions.

Is the industry doing enough to develop new technology quickly and efficiently to help meet growing world consumption?

Within the upstream oil and gas industry, a great deal is being done all the time to deploy breaking technology. Where technology is lagging, however, is in controlling the world’s insatiable growth in energy consumption. For example, while oil recovery in new fields is achieving 50% of the oil in place and exploration successes are hitting 30 to 40%, gasoline is still subsidized in India and China as well as in other parts of the world, modern diesel is popular in Europe but not in North America, and 14-mpg vehicles are still being made and sold on a daily basis. The need for new technology among energy consumers is as critical as it is among the upstream producers and downstream refiners.

Who influenced your career the most and how?

I have benefited from the wisdom and guidance of many faculty members in college as well as the friendships and examples of many international oil industry professionals and executives. The most lasting influence, however, was from the cycle of chaotic capacity expansion and uncontrolled collapse of the industry in Saudi Arabia between the late 1970s and early 1980s.

At the time when Aramco was managed as an international oil company, billions of cubic feet of gas and hundreds of millions of barrels of oil, condensates, and liquefied petroleum gases were burned while we were expanding production to prevent a global economic collapse. Cutting corners became a condoned and common occurrence, from drilling operations through production practices and reservoir management.

Once Aramco became a national Saudi oil company, the Saudi government gave us the support we needed to bring the oil reservoirs back to the highest operating standards in the industry and we set new resource management guidelines that we could all believe in. It took us years to do this, but we continue to benefit from that effort today, and our fields are now managed like clockwork.

What role has SPE played in your career?

SPE and my younger and older friends and colleagues who are in it were always there to provide the knowledge, insight, and support to do what was right on behalf of both Saudi Arabia and the industry. Many of our Aramco innovations in exploration and petroleum engineering came from shared technology within SPE. This included the characterization of all our giant oil fields with highly documented production wells, thousands of square kilometers of 3D seismic on mature fields, high volume horizontal drilling, logging behind casing, and massive reservoir simulations.

In time, Saudi Aramco—with SPE’s intellectual access—developed its own new areas of excellence such as its current maximum-reservoir-contact wells, extended-service high-volume submersible pumps, real-time field production management, and a whole array of exploration, drilling, completion, and production technologies. SPE not only inspired me and all of my colleagues to do all this, but it also made it a pleasure to be an oilman through the shared friendships and challenges among professionals from across the world.