(B)Natural Gas

75. In the 1970s, plans to capture the energy value of gas were developed and the Master Gas System (MGS) was born. The MGS enables Saudi Aramco to use nearly all the gas produced with oil production (known as associated gas) and gas produced from deep natural gas reservoirs (known as non-associated gas).

76. The MGS adds the equivalent of more than a million barrels of oil a day to the world energy supply and provides fuel and feedstock for Saudi Arabia's rapidly growing industries. In 2010, the production capacity of the MGS was 7.5 billion cubic feet per day. In the company’s overall gas operations, natural gas is processed for various production purposes.

77. The total (i.e. associated) reserves of natural gas in Saudi Arabia in 2010 were estimated to constitute 284 trillion cubic feet (tcf). In 2009, Saudi Aramco completed a multi-year, multi-project program that included significant increases to gas production and processing capacities.

78. Saudi Aramco entered into four joint ventures with a variety of international partners to explore for and produce non-associated gas for the domestic market. These joint ventures operate in various parts of the Rub' al-Khali (Empty Quarter). The joint ventures are:

1. EniRepSa Gas - With a consortium of Italian oil company ENI and Spanish- Argentinean oil company Repsol YPF to find and develop gas reservoirs in the Kingdom's Rub' al-Khali Basin.

2. Sino Saudi Gas – With Chinese oil and petrochemical company Sinopec to find and develop gas reservoirs.

3. South Rub' al-Khali Company - With Shell, which covers non-associated gas exploration activities, as well as the evaluation, development and production of natural gas, natural gas liquids and field condensates in two promising areas in the southern and eastern Rub' al-Khali.

4. Luksar Energy – With Russian oil company Lukoil to find and develop gas reservoirs in the Kingdom's Rub' al-Khali Basin.

(C)Downstream

79. Saudi Arabia has followed a general policy of diversifying from hydrocarbons by adopting measures that have broad downstream application throughout the economy.

80. Independent of the Government's diversification initiatives, Saudi Aramco has pursued a commercially based corporate policy of diversifying its operations downstream by increasing production of refined products, such as gasoline, kerosene, and long residue (bunker). This output of refined products increased with the recent expansion of the Petro Rabigh complex.

81. Future plans for downstream expansion include a refinery and chemical complex in Jubail, a refinery in Yanbu, and another refinery and terminal in Jazan. Recently, Saudi Aramco signed a memorandum of understanding with Sinopec to join as an investor in the "ongoing" development of the Red Sea Refining Company.

82. In addition, Saudi Aramco has agreed with Dow Chemicals to establish an integrated chemical complex joint venture in Jubail. The company is also looking to expand its transportation and delivery network with several projects to add new bulk plants and pipeline network.