Oman is expected to award four oil blocks to international oil companies on a production sharing basis in the second quarter of 2018, according to a senior official at the Omani ministry of oil and gas.
The Sultanate’s Ministry of Oil and Gas has started a bidding round for blocks 43B, 47, 51 and 65 in September. Of these four blocks, 51 is an offshore block, while all others are onshore blocks. Also, out of the four blocks, three blocks have crude oil deposits, while the fourth one is mainly a gas block.
Registrations for the licensing round were started on September 20 and the deadline for submitting bids is on December 31, 2017.
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The launch of the new round of bidding comes at a time when the crude oil market is showing a firm trend, which has helped to get better response.
“The response is very good since the oil price is attractive now,” said Dr. Saleh A Al Anboori, director general of Management of Petroleum Investment at the Ministry of Oil and Gas.
An earlier report suggested that there are currently over 10 open blocks, including the four blocks under tendering process, for development.
Dr. Al Anboori said the evaluation of bids will be conducted for three to four months, after the companies submit their bids. And depending on the convenience of the ministry and winning bidders, agreements will be signed.
He also noted that the Oman government has been encouraging multinational oil giants to find new reservoirs in a move to sustain production levels. As huge investment is required for bringing crude oil and natural gas above the ground in view of the peculiar nature of reservoirs in the Sultanate, the government has been encouraging multinational firms to undertake exploration and production on a production sharing basis.
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The Ministry of Oil and Gas in January 2017 signed an exploration and production sharing agreement with Oman Oil Company Exploration and Production for developing block 48, located between the Al Wusta and Al Dhahira regions. Under the agreement, the Oman Oil Company Exploration and Production, which is a subsidiary of the state-owned Oman Oil Company, will explore oil and gas in an area of 2,995 square kilometres.
Meanwhile, the Sultanate’s crude oil production fell by 3.9 per cent to 235.33 million barrels for the first eight months of 2017 (equivalent to 968,500 barrels per day), against 244.79 million barrels for the same period of last year. However, the average price of Oman Crude surged 35.4 per cent to $51 per barrel during the January to August period of 2017, against $37.6 per barrel for the same period of last year, according to the National Centre for Statistics and Information.
By A.E. James
© Muscat Media Group