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Saudi production capacity increase planned

Offshore

(Kuala Lumpur) -- Saudi Arabia's crude oil production capacity will rise to 12 million b/d a by 2009 from today's 9.5 million b/d, said Abdallah S. Jum'Ah, president and CEO of Saudi Aramco.

Speaking to the 11th Asia Oil & Gas conference through a teleconference, he said the capacity would help Saudi Arabia balance the global crude oil supply and demand.

Saudi Arabia would also have 1.5 to 2 million b/d of spare capacity to give balance in the high price environment, said Abdallah.

While it was getting expensive to develop and maintain such a level of production, "we can bear the cost to promote market stability," he said, attributing market stability to many factors including the geopolitical situation.

Abdallah also stressed on OPEC's role in the global oil supply and noted the declining production in OECD countries.

Another factor was the higher demand for light and sweet crude while most of the production was in heavy and sour crude, he said.

Abdallah stressed on the importance of Saudi Arabia's petroleum reserves esstimate of 200-250 billion barrels.