Saudi Arabia is very bullish on the future of oil

If you think that the members of OPEC are going to sit back and quietly watch the ushering in of the clean energy economy -- find the time to view the following eye-opening 60 Minutes story "The Oil Kingdom" and think again. Saudi oil officials are pulling out all of the technological stops and sparing no expense to find and drill for what they believe are vast new oil fields buried deep beneath remote deserts.

60 Minutes correspondent Lesley Stahl went to Saudi Arabia a few weeks ago to meet one of the most powerful men in the world, Ali Al-Naimi, the Saudi oil minister and de facto head of the OPEC oil cartel.

Al-Naimi says the U.S. is Saudi Arabia's number one customer. And the question is: what will Aramco do to keep it that way? One thing is discourage the move toward electric cars by trying to alleviate our concerns about the environment.

President-elect Obama has his work cut out for him. Just how the global energy scenario unfolds will be fascinating. I was amazed at the sophisticated (and expensive) technologies the Saudis have developed to discover and drill for oil located hundreds of miles away and several miles beneath the surface.

Will the U.S. be willing to make similar investments in the development of our indigenous renewable energy resources (offshore wind, for example)?

Click on the above screen to view Part One. Part Two follows below. (GW)

The Oil Kingdom: Part One and Part Two

60 Minutes
CBS News
December 7, 2008

60 Minutes correspondent Lesley Stahl went to Saudi Arabia a few weeks ago to meet one of the most powerful men in the world, Ali Al-Naimi, the Saudi oil minister and de facto head of the OPEC oil cartel.

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"If most Americans had an opportunity to sit down with the oil minister of Saudi Arabia, the thing they would like to know is where you think the price of oil's gonna be, say, in about six months. Is it gonna be up or down?" Stahl asked.

"You want my classic answer?" Al-Naimi replied.

"No. I want your honest appraisal…and your judgment," Stahl asked.

"My honest judgment is if I were to know what the price of oil six months from now, I would be in Las Vegas. Okay?" Al-Naimi said, smiling.

He may be smiling, but this is a man with serious heartburn and vertigo. The price of oil has been soaring and sinking up and down uncontrollably. Asked why oil prices spiked to $147 a barrel in July, Al-Naimi told Stahl, "Basically, there was what's called a 'fear premium.'"

"And the fear was that Saudi Arabia itself had peaked out. That you'd reached your ceiling of how much available oil is left in your overall reserve. So, what's the truth?" Stahl asked.

"The truth is here is the kingdom with more than 260 billion barrels. And I firmly believe that the potential to add another 200 billion barrels of oil are there to be found," Al-Naimi said.

If the oil minister of Saudi Arabia had one message, it was that there is no need for those fears.

And to make the point, the Saudis let 60 Minutes see facilities that will increase the country's capacity from about 10 million barrels a day to more than 12 million. And they're going to the ends of the Earth to do it.

One of those desolate places is Shaybah, a desert wilderness where temperatures can reach 135 degrees. The Saudis say that 18 billion barrels of oil lie beneath the red sand dunes, more than four times the proven reserves of Alaska.

To tap into it, the kingdom's national oil company, Saudi Aramco, had to build an oasis there. Awayyid Al-Shammari oversees the mega-project at Shaybah, an area of the kingdom known as the "Empty Quarter."


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