(MENAFN - Muscat Daily) The Oman government and oil giant BP are edging closer to a final agreement on large-scale commercial development of the Block 61 tight-gas fields.
The production-sharing agreement is expected to be signed by the end of this month or early next year, according to the H E Nasser al Jashmi, Undersecretary of the Ministry of Oil and Gas (MOG).
Speaking to mediapersons on the sidelines of the Gas Arabia Summit at Grand Hyatt Muscat on Monday, H E Jashmi said the government and BP have agreed on most of the terms of the final agreement, including pricing.
''We expect the final agreement to be signed before the end of this month or in the beginning of next year. We have to get approvals from different ministries and are working to finalise it as soon as possible. A committee with representatives from each side has been established to look after this project and it is currently studying and discussing the project's time frame, schedules and routes for the pipeline,'' he said.
In his speech at the summit, H E Jashmi said MOG will continue to support gas exploration and development, taking into consideration that most 'easy' gas has either been developed or is under development. ''We recognise the need to focus on tight, unconventional and sour gas.''
He said that in a few months, Oman Oil Exploration and Production Co will put on stream Oman's first tight gas development from the Abu Tubul field of Block 60, in the Empty Quarter. ''This field is challenging on many aspects and I am glad to see an Omani company taking full charge of its concession agreement with MOG to develop this difficult field,'' H E Jashmi said.
After signing the final agreement, BP will start developing the gas reserves at Khazzan and Makarem of Block 61, which is expected to be the largest single project to be executed in Oman.
H E Jashmi said that the Khazzan and Makarem project will add 1bn ft3 per day to Oman's gas network by 2017, in a first phase, not forgetting that a possible second phase could develop other gas in the same fields, including some sour gas.
He added that Oman's daily average production of gas in the year to date has been 103mn m3 per day, and it will increase to 113mn m3 per day in 2014.