Will Jordan’s search for oil pay off?

A general photo of an oil well. (Photo: Wikimedia Commons)
AMMAN — Petroleum is hard to find. Oil exploration is also costly and is mostly a shot in the dark that more often than not produces little to no oil discoveries. This has been Jordan’s experience with oil exploration since 1947 when the Iraqi Petroleum Company was awarded a 75-year exploration concession. The Iraqis did not strike oil and neither did the many foreign companies that followed. اضافة اعلان

A negligible oil pocket in the Hamza field found in 1984 was the only oil discovery to date in Jordan. Another find, in 1987, was of natural gas in the Risha field, and it was of commercial value.

Oil companies carry out geologic and geophysical studies and seismic surveys to look for indicators before committing their investment to oil exploration.

“There are a few indicators for the presence of oil in Jordan and we need to keep looking,” Mahmoud Alees, former advisor to the Ministry of Energy and Mineral Resources, told Jordan News. But, he added, “Jordan is now classified as a marginal area for oil discovery.”

More recently, the Ministry of Energy and Mineral Resources announced that it will reanalyze the data collected by all the foreign companies. It was great to hear the minister saying that early next year Jordan is reprocessing the data of seismic surveys using advanced software, especially the data used by BP in the Risha field.

Oil in Jordan was identified in the Sirhan area, close to the Risha field and the northern Saudi Arabia and western Iraq borders, according to a recent report by the Ministry of Energy and Mineral Resources. Another possible area for oil exploration is at Jordan’s northern borders, near the Golan Heights. Nine areas in Jordan are now designated for future oil exploration, according to the ministry’s report. To find oil, Jordan will have to dig many more oil wells.

“Only about 200 wells have been dug to date, which is too low by any standard for a country the size of Jordan,” geologist Sakhr Al-Nsour, president of the Jordan Geologists Association, told Jordan News.

“Jordan has to get serious about its energy sector and organize its efforts through a well-developed plan, not just for oil exploration, but for shale oil and green energy as well,” he added.

More than 90 percent of Jordan’s energy consumption is imported.

According to Alees, the Natural Resources Authority (NRA) adopted a strategy in 1980 to carry out petroleum exploration activities in various regions.

“The project was financed by Jordan’s Treasury, while the door was kept open for foreign companies to also join in,” he said.

The authority dug 87 wells at depths that ranged between 1,700 and 4,500m, 30 of which were in the Risha area and 27 in the Azraq area. This exploration program stopped in 1995, costing Jordanian tax payers $250 million.

“In my opinion, our most prominent exploration event was with BP International, which followed on the success of the National Petroleum Company, established in 1995, in the Risha field,” said Alees.

The National Petroleum Company has maintained natural gas production in the Risha field, but its capacity covers only 1 percent of Jordan’s energy needs.

BP International spent about $400 million on its exploration efforts before pulling out of Jordan in 2014 empty handed. BP’s failure to strike oil is why most foreign companies would not venture back into Jordan to explore for oil.

“No international oil company has shown interest in undertaking more exploration works in Jordan,” Alees said.

Many Jordanians posts on social media say that the government is hiding facts and that oil was discovered but never announced or pumped. Their argument is simple: if oil is found in neighboring countries, it should also be present in Jordan.

“Jordan’s geology is unique and oil wells are complex because of that. What Jordan can do is to carry out geologic surveys across the Kingdom to enhance its estimate of where oil could be present,” said Nsour.

There are more hurdles to oil exploration than the geological complexity and the capital. Both Al Nsour and Alees agree that Jordan should stop changing regulations and incentives with every new government.

“Lack of consistency in regulations and incentives scares foreign companies away,” added Nsour.

“We have the oil exploration knowledge but most of our talents have left to work elsewhere for lack of opportunities. We should lure them back into Jordan and get serious about oil exploration,” he said.

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