Oman to sign two oil, gas deals next month
Oman government is set to award two onshore oil and gas blocks for exploration to international oil firms in the Southern Dhofar region next month.
The Ministry of Oil and Gas has already finalised the terms and conditions of the deal for the proposed two blocks -“ 38 and 66. "Hopefully, we will sign the pact by next month. We are finalising the date for signing the agreement,- Dr Saleh A Al Anboori, Director-General of Management of Petroleum Investment, told 'Times of Oman' in an exclusive interview.
Dr Al Anboori also said that the ministry will receive bids from multinational oil giants for another four oil blocks, widely spread in the north and centre of the country, by the end of this month. "Thereafter, we will evaluate the bids for shortlisting companies. Then we will see the work programme and the technology. We are favouring companies on the basis of best work programme in pursuing the block, seismic studies, number of wells going to drill and technical capabilities,- he explained.
He also revealed that now the ministry is compiling data for tendering another seven blocks -“ four onshore and three offshore. The offshore blocks are 18, 41 and 59 and onshore blocks are 56, 57, 58 and 43A. These are mostly located in the south and north and include block 18, which was relinquished by India's Reliance Industries a couple of years ago.
Dr Al Anboori said as many as twenty-two multinational firms are currently exploring for -” and in some cases producing -“ oil in almost 25 concession blocks in the Sultanate under production sharing agreements. "Presently, multinational oil companies contribute 30 per cent of total crude production, while PDO constitutes the remaining 70 per cent oil output.-
CC Energy Development (CCED) started producing oil at the rate of 14,000 barrels a day (from its block three and four concessions) from last year. This is a promising sign of additional contribution from multinational companies operating in Oman. "It (the contribution of multinational firms in Oman's oil production) will increase.- Occidental and Daleel have also enhanced their crude oil production.
Dr Al Anboori said the high oil prices are encouraging multinational giants to invest in Oman for oil field development.
As huge investment is required for bringing oil above the ground in view of the peculiar nature of reservoirs in Oman, the government has been encouraging multinational firms to undertake exploration on production sharing basis.
US-based international energy firm PetroTel last year received a licence to explore for hydrocarbons in block 40 offshore Musandam in the north of the Sultanate. The 6,120 sq kilometre block is PetroTel's second concession in the Sultanate, having acquired the adjoining block 17 two years ago.
Both blocks are located in an area believed to hold promising hydrocarbon potential and is currently the focus of intensified efforts to evaluate and harness this potential.
PetroTel has committed to invest around $35 million for geological and geophysical studies and reprocessing of old seismic data during the appraisal phases. Another production sharing agreement was signed with Canada-based international oil firm, Allied Petroleum Exploration (APEX), for the development of block 36 in Dhofar region.
In fact, block 36 represents Allied Petroleum's first hydrocarbon province in the Middle East region. Allied Petroleum plans to tap cutting-edge Canadian oilfield technology in evaluating the hydrocarbon potential of Block 36.
These agreements manifest the successful ongoing efforts by the ministry to attract international oil companies in the development of Oman's economic mainstay.