Oman grants offshore concession to OQ and Malaysia’s Petronas

A joint venture between Malaysian oil company Petronas and Oman’s OQ Exploration and Production has agreed to explore an offshore concession for four years to boost the Gulf state’s hydrocarbon resources. 

As part of the agreement, Petronas will take a 70 percent stake in block 18, while OQ Exploration and Production will hold the remaining 30 percent, the state-run Oman News Agency reported. 

The initial exploration term of four years can be extended, with the possibility of granting a production concession for up to 30 years.

Block 18 is located in the Sea of Oman and covers an area exceeding 21,000 square kilometres. It is considered an offshore area with diverse geological potential, despite the technical challenges of exploration and drilling in deep waters, as no confirmed discoveries have been made in the block.

Oman’s energy minister Salim Nasser Al Aufi said the awarding of the concession aligns with the objectives of Oman Vision 2040, which seeks to ensure the sustainability of the energy sector. 

He expected the drilling operations and seismic surveys would lead to the discovery of new hydrocarbon potential, boosting national reserves.

OQ Exploration and Production is the largest specialised exploration and production company in the sultanate, with an average daily production of 224,000 barrels of oil equivalent.  

Oman produces about 1 million barrels of crude oil per day, accounting for about 70 percent of the government’s revenues. However, it expects its oil reserves, currently at about 5 billion barrels, to be severely depleted by 2060. 

• Omani-Spanish consortium plans green methanol project
• Oman must diversify exports to shore up economy, IMF says
• Oman and Kuwait sign deal for joint petrochemical venture