Bahrain's oil reserves have been a key component of the country's economy, with oil exports accounting for a significant portion of government income. In 2017, hydrocarbon-related revenue made up 75% of government revenue, and while there have been efforts to diversify the economy, oil still comprises 85% of Bahraini budget revenues. Bahrain's proven oil reserves were estimated to be around 124.6 million barrels as of 2016, ranking 67th in the world. However, in April 2018, Bahrain announced its biggest oil discovery since the 1930s, with an estimated 80 billion barrels of tight oil found off the west coast. This discovery is expected to boost Bahrain's economic and fiscal strength, helping to clear its budget deficit.
Characteristics | Values |
---|---|
Proven oil reserves | 124.56 million barrels as of 2016 |
Global rank | 67th |
Share of world oil reserves | 0.01% |
Years of oil left | 6 years (at current consumption levels) |
Oil consumption | 62,000 barrels per day (as of 2016) |
Global rank for oil consumption | 91st |
Share of world oil consumption | 0.1% |
Oil production | 63,886 barrels per day (as of 2016) |
Global rank for oil production | 59th |
Percentage of total proven reserves produced per year | 18.7% (as of 2016) |
Percentage of oil imported | 93% (as of 2016) |
Oil revenues | Received from two fields: the onshore Bahrain field and the offshore Abu Safah field, which it shares with Saudi Arabia |
Oil discovery | In April 2018, an extensive reservoir was discovered off Bahrain's west coast, estimated to contain 80 billion barrels of tight oil |
Gas discovery | In April 2018, 10-20 trillion cubic feet in onshore "Pre-Unayzah" deep gas reserves were discovered beneath the legacy Bahrain field |
What You'll Learn
Bahrain's oil reserves are approximately 124.6 million barrels
In April 2018, Bahrain announced its most significant oil and gas discovery since the 1930s. An extensive reservoir was found off the west coast, estimated to contain 80 billion barrels of tight oil. This discovery has the potential to drastically increase Bahrain's oil reserves, but it requires further study and evaluation.
The Bahraini government has been working to diversify its economy and income sources, as oil exports account for over 70% of government revenue. Bahrain is actively exploring Carbon Capture and Storage (CCS) technology to deploy across its oil and gas sectors.
The country is also investing in refinery upgrades and LNG import terminals to improve energy efficiency and meet seasonal gas demand. Bahrain's crude oil production has averaged 200,000 barrels per day in recent months, with the majority of its oil coming from the Abu Safah field.
Transit Visa for Bahrain: What You Need to Know
You may want to see also
Oil exports account for over 70% of government income
Bahrain's oil sector has been the main source of income for the country, with Bahraini crude oil production reaching 198,000 barrels per day in 2013. Of this, 48,000 barrels per day came from the Bahrain Field, while 150,000 barrels were produced in the Abu Safah field. The Bahrain Refinery refines more than 274,000 barrels per day, and the country imports the rest of its oil needs from Saudi Arabia.
Bahrain's government has recognised the need to diversify its economy away from oil, and while it has had some success, oil revenues still make up the bulk of its income. In 2017, hydrocarbon-related revenue accounted for 75% of government revenue, down from 87% in 2013. Bahrain's onshore oil reserves are expected to last less than seven years, making new discoveries of oil reserves crucial for the country's economic future.
Bahrain has been investing in other sectors, including banking, tourism, and manufacturing. The country's capital, Manama, is home to a successful financial industry, and Bahrain was named the world's fastest-growing financial centre in 2008. Additionally, Bahrain has been working to expand its exploration of energy sources and promote the production of petrochemicals through companies like the Bahrain Petroleum Company (BAPCO).
Despite these diversification efforts, oil exports continue to play a dominant role in Bahrain's economy, contributing significantly to government income and overall economic growth.
US Naval Presence in Bahrain: A Marine Base?
You may want to see also
Bahrain's oil reserves are expected to last 6-10 years
Bahrain's oil reserves are expected to last between six and ten years. As of 2016, Bahrain held 124,560,000 barrels of proven oil reserves, ranking 67th in the world. This accounted for about 0.0% of the world's total oil reserves. Bahrain's proven reserves are equivalent to 5.5 times its annual consumption, which means that without imports, there would be about six years of oil left at current consumption levels.
Bahrain's economy is heavily dependent on oil and gas, with petroleum being the country's most exported product. Oil and gas comprise 85% of Bahraini budget revenues, and revenues from oil exports account for over 70% of government income. Despite efforts to diversify the economy, lower world energy prices have generated significant budget deficits, about 10% of GDP in 2017 alone.
Bahrain receives its oil revenues from two fields: the onshore Bahrain field and the offshore Abu Safah field, which it shares with Saudi Arabia. In April 2018, the Bahraini government announced its biggest oil and gas discovery since the 1930s, with an extensive reservoir off Bahrain's west coast estimated to contain 80 billion barrels of tight oil. However, this find requires further study.
Bahrain's oil production has stabilized at around 40,000 barrels per day, and reserves are expected to last between ten and fifteen years. The country has also invested in other industries, such as aluminum smelting and petrochemicals, to reduce its dependence on oil and gas.
Exploring Bahrain's Diverse Job Market and Occupations
You may want to see also
Bahrain's biggest oil discovery in decades was announced in 2018
Bahrain was the first among its GCC peers to discover fossil fuels in 1932, but it was also one of the earliest to start running out of oil. The country has been dependent on oil revenues to fund itself, and its deficit was worsened by the oil crash that began in 2014. The new discovery could help Bahrain beef up its output in the region, which includes heavyweights such as the United Arab Emirates and Iran.
Bahraini officials expect production from the well to be up and running within five years. The country currently produces about 50,000 barrels of oil per day and has proven reserves of approximately 124.6 million barrels, ranking 67th in the world. The discovery of such extensive reservoirs could stimulate private investment in the country's energy sector and increase government oil and gas-related revenue, helping to reduce Bahrain's fiscal and current account deficit.
The US oil producers Halliburton and Schlumberger were among the three consultants that worked on the discovery, and Halliburton has been tasked with fracking the shale reserve to evaluate how much oil in the find is actually extractable. While there is optimism about the discovery's potential impact on Bahrain's economy, some caution against more borrowing for an already debt-saddled economy. The discovery could, however, improve Bahrain's credit ratings and provide more financial stability.
Drunk Excuse in Bahrain: A Legal Loophole?
You may want to see also
Bahrain's oil and gas sector is being restructured
Bahrain's oil and gas sector is undergoing a significant restructuring process as the country navigates the challenges and opportunities presented by the energy transition. While Bahrain seeks to diversify its economy and income sources, the oil and gas industry remains a vital component, contributing substantially to the country's exports and overall economic growth.
In 2021, a series of reforms were implemented to restructure the oil and gas sector, including the consolidation of the National Oil and Gas Authority into the Ministry of Oil. This move aimed to streamline regulatory functions and provide more effective oversight. As a result of the restructuring, the Ministry of Oil and Environment (MoOE) became the primary regulatory and oversight body for the oil and gas sector. The MoOE is committed to embracing advanced technologies, such as big data, artificial intelligence, and the Internet of Things, to drive the sector's growth and digital transformation.
As part of the restructuring, the government is also focusing on the development of the petrochemical industry. Five petrochemical sub-sectors have been identified for rapid growth, including construction chemicals, water treatment chemicals, and oil field chemicals. Additionally, Bahrain is exploring Carbon Capture and Storage (CCS) technology to deploy across its oil and gas and industrial sectors.
The government-owned Bapco Energies, formerly known as the Oil and Gas Holding Company (nogaholding), is at the forefront of the restructuring process. Bapco Energies oversees several entities within the oil and gas sector, including the Bahrain Petroleum Company, the Bahrain National Gas Company, and the Bahrain Aviation Fuelling Company. The company is transforming from an oil and gas holding company to an integrated energy company, focusing on the entire value chain of the sector. As part of its strategic initiatives, Bapco Energies is optimising operational efficiencies, reducing costs, and creating value through portfolio changes and function streamlining.
In line with Bahrain's commitment to sustainability and emissions reduction, the country has pledged to achieve net-zero emissions by 2060. The National Renewable Energy Action Plan and the National Energy Efficiency Action Plan outline ambitious targets for renewable energy integration and energy efficiency improvements, respectively. These plans reflect Bahrain's commitment to international agreements, such as the Paris Agreement and the UN Sustainable Development Goals.
Jews in Bahrain: A Safe Haven in the Middle East?
You may want to see also
Frequently asked questions
Bahrain's oil reserves are dwindling. As of 2016, the country held 124,560,000 barrels of proven oil reserves, ranking 67th in the world, and accounting for about 0.01% of the world's total oil reserves. At current consumption levels, there are approximately six years of oil left.
Oil and gas are a dominant source of income for Bahrain, with petroleum being the country's most exported product. Since 2007, revenues from oil exports have accounted for over 70% of government income. In 2017, hydrocarbon-related revenue made up 75% of government revenue, and in 2020, oil comprised 85% of Bahraini budget revenues.
Bahrain is actively working to diversify its economy away from oil. The country has a successful finance industry, with Manama, its capital, being home to many large financial structures. Bahrain has also established various sophisticated projects in the extractive and manufacturing industries, as well as in the services and financial sectors.