Gas exploration agreements inked with BP, Petronas

MUSCAT The Sultanate on Wednesday, 15 April 2009 signed two exploration and production sharing agreements with Malaysia’s Petronas and global energy major BP.

The first agreement is with Petronas for exploring, developing and producing natural gas at Block 63 (Natih/West Roba), which is in the Al Dhahirah and Al Dakhiliyah regions, covering an area of 3,709 sq. km.

Petronas’ partners in the deal are Oman Oil Company and Petrochemical Industries.

HE Dr Mohammed Bin Hamad Al Rumhy, Minister of Oil and Gas, signed the agreement with Petronas Vice-President Datuk Abdullah Karim, Oman Oil Company Chief Executive Officer Ahmed Bin Salim Al Wahaibi, and Petrochemical Industries Chairman Ahmed Bin Saif Bin Musallam Al Rawahi.

The second agreement is related to gas exploration in Block 61, (in central Oman).

The agreement was signed by Al Rumhy and for BP by Michael Townsend, CEO.

As per the agreement, the gas will be sold to the government for two years.

Dr Saleh Bin Ali Al Anbori, Director-General of Petroleum Consultations at the Oil and Gas Ministry, said the first exploration and production sharing agreement signed between Petronas and its partners covers two parts.

The first is exploration of gas for four years. It includes drilling exploratory wells and acquiring new seismic data. The second part is connected with appraisal and developing of existing natural gas fields (3 fields). The company has two years to develop the fields. If commercial production is done the agreement will be extended to 20 years.

As for the agreement with BP, Al Anbouri said it is related to the gas price and sale to the government. A previous agreement was signed between the two sides relating to the right of concession and exploration of gas. The concession block is located at ‘Khazan Makarim’ between Al Dakhiliyah and Al Wusta regions, he added. The government does not bear any financial commitment during exploration periods.