Oman: Struggling To Cope With Too Much Gas?

Less than two years ago Oman contemplated curbing LNG production to meet rising domestic consumption. With demand now stagnant and exports nearly maxed out, the Sultanate could struggle to develop new gas finds.

Oman is undergoing a gas revolution. The BP-operated Khazzan field on Block 61 (BP 60%, state Oman Oil Company 40%) started production in September 2017 and hit full Phase-1 output of 1bn cfd earlier this year. MEES estimates this will boost Omani gas output by 20% in 2018 ( MEES, 29 September 2017 ).

BP this month took a final investment decision (FID) on the 500mn cfd Phase-2 of Khazzan, commencing development drilling on the 3.5tcf project on 25 March. Total Block 61 reserves are 10.5tcf and BP country manager Youssef al-Ojalli expects first gas from Ghazeer, as Khazzan Phase-2 is known, in 2021.

With Khazzan Phase-1 at full capacity of 1bn cfd (10.3 bcm/y), 2018 gas production should rise about 20% from 2017 to around 47 bcm.


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