The first phase of development

BP and Eni have signed an agreement with the Ministry of Oil and Gas of the Sultanate of Oman towards the award of a new exploration and production sharing agreement (EPSA) for Block 77.

Under the terms of the heads of agreement (HoA), the companies will work with the Government of Oman towards the EPSA award.

With a total area of almost 3,100km², Block 77 is located in central Oman, 30km east of the 2,850km² Block 61 operated by BP.

Block 61 contains the already-producing Khazzan gas project, as well as the Ghazeer project that is currently under development.

After carrying our further discussions with the ministry, the company will finalise details of the EPSA.

“We look forward to continuing to explore and efficiently develop the country’s resources.”

BP upstream chief executive Bernard Looney said: “This would represent a further deepening of BP’s important position in Oman, building on our successful delivery of the major Khazzan project in 2017 and its second phase of development that is currently under construction.

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“We look forward to continuing to explore and efficiently develop the country’s resources, working in close partnership with Eni and Oman to underpin our commitment to delivering long-term gas production for Oman.”

BP signed an EPSA for the Block 61 in central Oman in 2007 and has since had an upstream presence in the area.

In 2013, the company signed gas sales agreements and approval for the development of the Khazzan project on the block.

Following the amendment of the EPSA in 2016, a further 1,000km² was added to the block allowing the second phase of development, known as Ghazeer, which is scheduled to become operational in 2021.

The first phase of development, known as Khazzan, started gas production in 2017 and currently produces one billion cubic feet of gas a day.

Block 61 is operated by BP with a 60% stake. The Oman Oil Company for Exploration & Production and Petronas’ wholly owned subsidiary PC Oman respectively own 30% and 10% interests.