BP’s negotiations with the Omani government over the terms and conditions for the $15bn development of the Khazzan-Makarem tight gas fields on Oman’s Block 61 are long-running. Thus far, the key sticking points have included the price BP will receive for gas production, production volumes, the share of condensate output it will be able to market and the total length of its production agreement.

Oman has seen a large gas production increase over the last decade. Despite this the country faces a gas feedstock shortage given strong domestic demand growth, highlighting the need for a quick resolution to the Khazzan talks. “Discussions are still ongoing,” Oman’s Minister of Oil and Gas Muhammad al-Rumhy said at the Ministry of Oil and Gas press briefing in Muscat earlier this month. “It is a big project, big reserves, challenging work…[with] a number of issues that still need to be discussed. So there are disagreements yes…but we are both very optimistic on reaching the agreement hopefully in the coming weeks.” (CONTINUED - 773 WORDS)