The sultanate’s energy ministry is in talks with Shell and TotalEnergies to sign a commercial agreement for developing block 11. Credit: MEED.

The Omani Government is in discussions with Royal Dutch Shell and France’s TotalEnergies for the development of block 11, which is rich in natural gas reserves.

“Discussions are ongoing now to finalise the commercial agreement between the government and the same [block 10] partners for block 11,” Salim al-Aufi, undersecretary at Oman’s Ministry of Energy and Minerals (MEMR), was quoted as saying in a local media report.

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MEMR signed a concession agreement in December with a consortium led by Shell’s Oman subsidiary, Shell Integrated Gas Oman, to develop and produce natural gas from block 10 of the Saih Rawl gas field.

The Shell-led consortium consists of Omani energy holding company OQ and Marsa Liquefied Natural Gas (LNG), a joint venture (JV) between France’s TotalEnergies and OQ. The concession agreement establishes Shell as the operator of block 10, holding a 53.45% working interest, with OQ and Marsa LNG holding 13.36% and 33.19% stakes, respectively.

Production from block 10 is planned to start production in two years and is expected to reach a peak production capacity of 500 million cubic feet of gas a day (MMcfpd).

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Block 11 is located adjacent to block 10.

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Al-Aufi added: “We have three blocks in the market. We are just waiting for the final bids to arrive. I think the last day is 31 March, then we will start looking into evaluating the bids and hopefully allocating some of these blocks.”

According to the National Center for Statistics and Information, Oman’s total natural gas production and imports were 46.05 billion cubic metres (Bcm) in the first 11 months of 2021. This marks an increase compared with 42.186Bcm in November 2020.

This article is published by MEED, the world’s leading source of business intelligence about the Middle East. MEED provides exclusive news, data and analysis on the Middle East every day. For access to MEED’s Middle East business intelligence, subscribe here.