Aramco denies interested in U.S. Frac Tech stake Tuesday, 27 December 2011 13:26

KHOBAR, Saudi Arabia: State oil giant Saudi Aramco  denied on Tuesday it was competing for a stake in U.S.-based Frac Tech International, a company that operates technology used extensively in North America to free up trapped oil and natural gas.

"Recent media reports suggesting Saudi Aramco is competing for an interest in a U.S.-based shale-gas services provider are completely untrue," Aramco said in an e-mailed statement.

On Dec. 14, sources told Reuters Saudi Aramco and Chinese oil companies, Sinopec and CNOOC Ltd, are each in talks to buy a stake in Frac Tech International.

The sources said Frac Tech was also in advanced talks with Aramco, Spain's Repsol-YPF SA and Sinopec - as China Petroleum & Chemical Corp is known - to establish three separate fracking joint ventures in the Middle East, Argentina and China.

Aramco did not say in Tuesday's statement if talks to establish a fracking joint venture were also false.

Fracturing is an oil and natural gas drilling technique that has sharply boosted North America's energy output and is now spreading abroad.

Saudi Aramco is keen to develop its unconventional gas resources to meet rising domestic demand but production prices are still too high, a senior executive at the company said in September.

Aramco has started evaluating tight gas and shale gas where it would initially focus on the northwest and in the area of the world's largest onshore oilfield Ghawar as gas infrastructure is already in place.

In November, Saudi Aramco's chief executive acknowledged that the use of fracking was set to shift the energy balance of power and U.S. dependence on Middle East oil.(Reuters)