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Oman goes for more gas

BP and Eni are cooperating in a new search for gas close to the successful Khazzan project

It is still early days. BP and Eni thus far have signed only a heads of agreement that they hope will lead eventually to the award of an exploration and production-sharing accord to develop a newly-created block in central Oman. Block 77 (total area of 3,100km2 or 1,197 miles2) lies only 30 km to the east of Block 61.

BP is the operator of the Khazzan tight-gas project in Block 61, which is producing around 1bn cf/d. A second phase, Ghazeer, is under development and is scheduled to come onstream in 2021, adding a further 0.5bn cf/d of gas production. At full capacity of 1.5bn cf/d, Block 61 will produce enough to cover around 40pc of Oman's domestic gas needs.

Partnering BP, which holds a 60pc share in the Khazzan/Ghazeer project, are Oman Company for Exploration & Production (30%) and Petronas subsidiary PC Oman (10%).

Khazzan proved to be a game changer for Oman, enabling its LNG plant at Qalhat to return to something close to its capacity of 10.5mn t/y capacity, after producing well below this for many months. BP has signed a commitment to supply gas to the LNG plant at least until 2025

Block 77, if BP and Eni discover what they say could be a potentially "significant" volume of gas, would go even further to meeting domestic demand.

Last year, state-controlled Petroleum Development Oman also used the adjective "significant" to describe a discovery it made at the Mabrouk North East field in the north of the country. The field has more than 4tn cf of gas and 112mn bl of condensate in place – close to existing gas development infrastructure.

Aside from its own gas production, Oman receives around 2bn cm (70tn cf) of gas from Qatar via the Dolphin Pipeline, which also supplies the UAE. Plans to import gas from Iran became bogged down over price differences – even before the imposition of US sanctions on the Iranian energy sector. So that project is unlikely to proceed in the foreseeable future. Also, the urgency to source gas from Iran in order to feed the Qalhat LNG plant has passed, with Khazzan now fulfilling that role.

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