Saudi Arabian Oil Co., the world’s largest crude exporter, increased production to an all-time high last year while keeping its reserves unchanged as the kingdom battles for market share.
Saudi Aramco, as the state-owned company is known, produced 10.2 million barrels a day of crude in 2015, up from 9.5 million in 2014, according to an annual review posted on its website Thursday.
Natural gas output rose to 11.6 billion standard cubic feet a day from 11.3 billion. The company discovered two gas fields and three oil deposits last year, compared with five gas fields and three oil deposits in 2014.
“Expanding oil and gas supplies to meet the needs of domestic and international markets is at the core of Saudi Aramco’s business, and in 2015 the company delivered on its commitments, reaching record levels of oil production and gas processing,” Chairman Khalid Al-Falih said in the review.
Saudi Arabia’s rising production, along with increased output from shale plays in the U.S. last year, exacerbated a global supply glut that drove down benchmark prices by more than 30 percent in 2015.
OPEC, led by Saudi Arabia, chose in November 2014 to keep pumping crude to protect its share of the market rather than cutting output to boost prices.
Last month, the Organization of Petroleum Exporting Countries and other major producers including Russia failed to reach an agreement over a proposal to freeze output to shore up prices after Saudi Arabia insisted that it couldn’t sign up to a deal without the participation of Iran, which has pledged to boost its own oil output to pre-sanctions levels before considering a cap.
The Saudi company’s oil reserves were unchanged at 261.1 billion barrels, while reserves of gas increased to 297.6 trillion standard cubic feet from 294 trillion. The company said it maintains an oil-production capacity of 12 million barrels a day.
Saudi Aramco is undergoing a major transformation that will include selling less than 5 percent of its shares to the public by the end of 2018.
The company’s restructuring plan will be announced within six months, Deputy Crown Prince Mohammed bin Salman said in an interview in Riyadh on April 15.
After the IPO, Saudi Aramco will become a holding company that is not involved in the daily management of its subsidiaries, he said.
The company exported 2.6 billion barrels of crude in 2015, or 7.1 million barrels a day, up from 2.54 billion in 2014.
Saudi Aramco’s exports to major Asian markets increased “substantially” last year from a year earlier, with shipments to India jumping 18 percent.
Exports to China grew 4.5 percent. The company said it was able to maintain the same level of exports to U.S. market at 1 million barrels a day “despite competition from shale oil.”
The operation of new local refineries helped Saudi Aramco’s exports of petroleum products to increase by 38 percent.
Saudi Aramco’s fully-owned oil-refining capacity was 3.1 million barrels a day at the end of last year, the same as in 2014, according to the report.
The company’s total refining capacity was at 5.4 million barrels a day in 2015. Saudi Aramco is seeking to double its refining capacity to between 8 million and 10 million barrels a day, Chief Executive Officer Amin Nasser said in a March 9 interview.
Saudi Aramco said in the review that it’s expanding its Rabigh Refining & Petrochemical venture with Sumitomo Chemical Co.
The second phase of the project will increase the production capacity of the ethane cracker, add a new world-scale aromatics complex and create 22 process plants. The project will start commissioning in mid-2016.
Last year, Saudi Aramco began exploring the development of a chemicals complex to be integrated with its SATORP joint venture with Total SA, it said in the review.
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