(MENAFN- Muscat Daily) Muscat- Global energy giant BP and the Ministry of Oil and Gas (MOG) announced the commencement of production at the US$16bn Khazzan natural gas project, operated by BP in partnership with Oman Oil Company Exploration and Production (OOCEP).
Speaking at the event to announce the opening of the first tight gas project in the country, H E Salim bin Nasser al Aufi, Undersecretary at MOG said the project was scheduled to start production in the first quarter of 2018, but due to improvement in exploration techniques and efforts taken by the company, they are able to start production much ahead of schedule and at reduced cost.
H E Aufi said, 'The total requirement of natural gas in the country is roughly around 3.5bn cubic feet/ per day (bcf/d), and the project is expected to deliver around 1bcf/d. And this will make additional gas available for export also after converting it to LNG. But volumes may not be very significant as there is also a growing demand for the gas in the country.'
BP in a statement said, 'The Khazzan tight gas reserves lie at depths of up to five kilometres in narrow bands of extremely hard, dense rock. These complex and challenging conditions require specialised drilling equipment, the precise drilling of both vertical and horizontal wells, and well stimulation to free the gas'.
BP expects to start-up seven major upstream projects in 2017, making it one of the most important years for commissioning new projects in BP's history. These seven projects are expected to make a significant contribution to the 800,000 barrels of oil equivalent per day of production from new projects that BP expects to add by 2020, the statement said.
The production sharing agreement for Block 61, which contains the Khazzan field, was first signed in 2007 and was amended in 2013 and extended in 2016.
According to MOG, the gas from Khazzan is earmarked for use as a feedstock to develop the country's petrochemicals industry as well as in power generation. BP owns 60 per cent of the 4,000sqkm exploration block containing the Khazzan field, with the other 40 per cent held by the state-owned OOCEP.
Speaking about future projects, Yousuf al Ojaili, president of BP Oman said that the first phase of the project, which required drilling over 200 wells has been completed. Work on the second phase that involves a further 100 wells will start soon. After completion of the second phase, production is likely to reach 1.5bcf/d. Total recoverable resources across the two phases are estimated to be 10.5tn cubic feet of gas, accounting for 42 per cent of Oman's total reserves.
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