The announcement earlier this year of the Saudi Gas Initiative is expected to give the gas sector a timely lift as the Kingdom plots the course of its long term industrial development.

A number of international oil companies (IOCs) have been awarded development contracts in the multibillion dollar initiative, some of which will see the development of new petrochemical facilities.

A consortium comprising Exxon Mobil Corporation, Royal Dutch/Shell Group, BP Amoco PLC and Phillips Petroleum Company have been awarded a project to develop South Ghawar, called Core Venture 1, with an estimated investment value of between $15 billion and $17 billion.

This venture encompasses a large exploration area, two petrochemical plants, two gas-fired power plants, two desalination units, one ''straddle'' plant, a fractionation unit, and gas pipelines from South Ghawar to the Red Sea.

ExxonMobil also secured leadership of Core Venture 2, a Red Sea-based project, with joint bidders Occidental Petroleum Corporation and Enron Corporation also getting an unspecified stake.

Core Venture 3, the Shaybah project, was awarded to a consortium of Shell, TotalFinaElf and Conoco Inc. This venture encompasses exploration blocks South of Rub Al Khali, development of the Kidan gasfield, recycling of gas from the Shaybah field, construction of pipelines to move gas from Shaybah to the Haradh and Hawiyah gas treatment plants, and construction of a petrochemical plant in Jubail as well as a power plant and a desalination plant at as-yet-undetermined sites.

The awards are the start of a long process in which the Kingdom must still work out details of project developments, financing arrangements, pricing and involvement of the various Saudi players.

Each Core Venture will involve gas enhancement, pipelines and petrochemical, power and water projects.

''Saudi Arabia's Gas Initiative is a tremendous opportunity for Shell to show what it can do in many other areas, including power generation and desalination, as well as in our more traditional roles of gas processing and in petrochemical project developments,'' said Philip Watts, chairman of the committee of managing directors of the Royal Dutch/Shell Group of Companies.

''I think we are in a great position to be able to demonstrate to Saudi Arabia that we can be partner of first choice for the future,'' he added.

ExxonMobil's Red Sea venture is a large exploration project in a huge area in the western third of the Kingdom.