UK-based energy giant and state-owned Oman Oil signed a deal on Sunday to develop a second phase of the Khazzan natural gas field.
The estimated cost of developing the entire project is around $16 billion, BP said in a statement.
The deal will add over 1000km2 to the south and west of the original 2,700km2 Block 61.
Development of this additional resource is subject to final approval of the Government of Oman and of BP, both expected in 2017.
Oman, which exports LNG via the country’s export plant in Qalhat, is studying options to import the chilled fuel due to domestic gas shortages and increased demand for power generation.
However, according to BP, the Khazzan reservoirs in Block 61 represent one of the Middle East’s largest unconventional tight gas accumulations, with the potential to be “a major new source of gas supply for Oman over many decades“.
Combined plateau production from both phases of the project is expected to total approximately 1.5 billion cubic feet of gas a day (bcf/d), equivalent to around 40% of Oman’s current total domestic gas production, BP said.
BP is the operator of Block 61 with a 60% interest and Oman Oil holds the other 40%.
LNG World News Staff