Latest Delay Further Complicates Gas Dreams

BMI View: Sino Saudi Gas is set to delay existing plans to drill for gas in the vast deserts of Saudi Arabia's Empty Quarter on the back of economic and technical concerns related to the prospect. The latest announcement continues the mixed results posted from longstanding efforts to boost domestic production of gas necessary to sustain Saudi Arabia's rapidly rising energy needs. Although new projects and discoveries pose upside risks to the outlook for Saudi gas, a series of constraints - both geologic and self imposed - pose enough downside risk to keep supplies tight well into the future.

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