Jordan is planning to produce up to 100,000 barrels a day by 2020 from the country's vast oil shale-rock formation and other oil exploration blocks from almost nothing now, senior Jordanian energy and company officials said.

"We are determined to achieve this goal," director-general of the state Natural Resources Authority, or NRA, Maher Hijazin said late Tuesday at the signing ceremony of an oil-shale concession agreement with Estonia 's Eesti Energia, better known as Enefit.

Under the deal, Enefit is expected to invest $5 billion over 10 years and to reach a production target of 40,000 barrels, or about 40% of Jordan's current oil needs, from a 40-square-kilometer area that is part of Attarat Um El-Ghudran region in southern Jordan, said Harri Mikk, member of the management board of Enefit.

Jordan 's total output would be a drop in the bucket even if it hits its 10-year goal. Global demand was 84.77 million barrels a day last year, according to the International Energy Agency.

But the development would help Jordan meet domestic energy requirements as it looks to expand an economy that has been hit hard by costly bills--around $2.8 billion in 2008, according to government figures--for petroleum imports.

The kingdom now imports 96% of its energy needs, the country energy minister Khaled al-Irani said.

Jordan is believed to be the holder of the world's fourth largest oil-shale resources, with Enefit and the government estimating that about 45 billion tons of oil shale could contain up to 28 billion barrels of oil.

Development of the fields is feasible because as long as oil prices remain strong. On the New York Mercantile Exchange, light, sweet crude futures for delivery in June traded above $75 a barrel early Wednesday.

The Attarat Um El-Ghudran--"Mother of Springs" in Arabic--region as a whole is believed to contain the largest oil-shale deposits in the kingdom, with an estimated 25 billion tons.

"Enefit's concession area is believed to contain 2.6 billion tons of oil shale that could be translated to 1.5 billion barrels of oil," Mikk told Dow Jones Newswires.

Before it can build the plant to process oil-shale rock, Enefit needs to carry out further survey and additional mine studies and testing, which will take as long as four years. The company is expected to invest $60 million in that time, Mikk said.

The construction of the project will take three years, he added. Total project development would continue for 40 years, he said.

Enefit will hold 76% stake in the project, while a local Jordanian group called Near East would own the remaining 24%, Mikk said.

Under a regime approved by the Jordanian cabinet, a contractor carries the cost of exploration but the government will receive a variable share of eventual production. At low levels of output, the government shares 40%, but once production rises, for example to 200,000 barrels a day, the government's share reaches 70%, officials have said.

Hijazin said that the Jordanian government is expected to sign two similar concession agreements by the end of this year. He didn't elaborate. Jordan has previously signed eight MOUs to carry out technical and feasibility studies on the kingdom's oil shale. So far two had been materialized to deals.

The kingdom signed last year a concession agreement with Royal Dutch Shell PLC (RDSB) to explore oil in the country's oil-shale deposits. Shell is expected to invest billions of dollars in the project over 20 years.

Shell is planning to drill 30 to 83 wells by the end of this year in its concession area of 22,000 square kilometers, officials from the NRA told local press Monday. Shell is planning to drill the first well this month, they said.

Jordan also signed a deal last year with BP PLC (BP) that could be worth up to $8 billion to explore and boost output from the kingdom's Risha gas field, near the border with Iraq .

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