Exploration And Production In Oman
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Most Recent Updates



Oil

  • Oman's total oil supply reached 924,000 barrels per day in 2012, and the government hopes to produce more than 940,000 barrels per day in 2013.
  • As of 2013, there are exploration and production activities in 28 of Oman's exploration blocks, according to the Ministry of Oil and Minerals. Oman anticipates awarding 2 onshore exploration blocks in late 2013, and plans to put another 7 blocks (4 onshore and 3 offshore) to tender in the near future. Nearly all of Oman's oil production comes from the Oman Basin, which spans most of the country. There are also a few small fields in the northern exclave on the Musandam Peninsula, all of them located offshore. In November 2012, the first offshore production in the country occurred in Block 8 off the coast of the Musandam Peninsula.
  • A List of all the Oil and Gas Concession Blocks in Oman
  • Oman's average annual crude oil production peaked in 2000 at 970,000 barrels per day (bbl/d), but dropped to just 710,000 bbl/d in 2007 due to declining production at the country's fields. Oman successfully arrested that decline, and annual crude oil production rose each of the next five years, hitting 919,000 bbl/d in 2012. Improved EOR techniques helped drive this turnaround, although the country also experienced some additional production gains as a result of recent discoveries. Oman's government aims to produce an average of 940,000 bbl/d in 2013, and to hold production at that level for the next five years, according to the country's Ministry of Oil and Gas.
  • Several recent developments could contribute to future oil production growth in Oman. Some of the notable new developments include Circle Oil's January 2013 announcement of Block 52 (offshore) with its 7 billion barrels of oil in place and Occidental Petroleum's March 2013 announcement that Block 53 could contain hundreds of millions of barrels of oil in place.

Oman crude oil and lease condensate production, 1980-2012

Enhanced oil recovery (EOR)

  • EOR techniques are critical to Oman's future production plans, and, as such, developments in those technologies are important to Oman's future production. Block 6, operated by PDO, is the center of current EOR operations, with the Marmal field (polymer), Harweel Oil Field (miscible), and Qarn Alam Oil Field (steam) using all three of the major EOR techniques within the same block.
  • In late 2012, Shell invested more than $25 million in a solar-powered EOR process, although it is not operating as of September 2013.
  • Miscible gas injection involves pumping gas, often toxic, that dissolves in the oil, facilitating higher flow rates. Oman's operators at the Harweel oil field cluster use this technique in their operations, and, as a result of EOR, Harweel could produce an additional 40,000 bbl/d.
  • Thermal EOR methods are being deployed at Mukhaizna, Marmul, Amal-East, Amal-West and Qarn Alam fields. Thermal EOR entails the injection of steam in various ways and durations so as to facilitate the flow of heavier oil to the well. Thermal EOR could increase production at both Amal-East and Amal-West to 23,000 bbl/d by 2018. Furthermore, the steam injection at Qarn Alam should increase production by 40,000 bbl/d by 2015 through a novel process in which the steam drains oil to lower producer wells.
  • At projects such as Marmul, with its heavy oil, injecting polymer fluid is more effective than other EOR techniques. When reservoirs contain heavier grades of crude, the viscosity of the oil restricts its flow to the well. With such a heavy grade of crude, water injection might not prove effective, as the disparity in viscosity causes the water to pass the oil, instead of pushing it to the well.
  • PDO wants to increase recovery rates at Yibal, a mainstay of Omani production, to 55% through traditional water-flooding. The discovery of al-Ghubar South in 2009 is the most promising discovery for Oman in years. According to the Ministry of Oil and Gas, al-Ghubar South could add as much as 1 billion barrels to reserves. Two significant discoveries were also made at Malaan West and Taliah in the Lekhwair cluster in northwest Oman, which will broaden baseline production in the future.

Other large EOR projects include:

  • Karim Cluster - a cluster of 18 small oil fields all flowing to the Nimr production facility, which is operated by Medco (Indonesia). Currently producing 18,000 bbl/d, PDO is aiming to boost production to around 35,000 bbl/d in the short term.
  • Harweel Cluster - PDO estimates a capacity of 100,000 bbl/d from the current 44,000 bbl/d in the next five years.
  • Growth of up to 70,000-80,000 bbl/d from five clusters, such as the Rima Cluster, is expected through various efficiency gains and EOR applications.

Natural Gas

  • Oman's potential for natural gas production growth may be substantial, supported by promising developments in several new projects.
  • The opening of the Oman LNG facility in 2000 helped spur Oman's dry natural gas production, which grew by 66% between 2000 and 2011. Official government data indicate that Oman's gross natural gas production grew to more than 1.2 Tcf in 2012, an increase of nearly 9% from the 2011 total. Nearly 83% of the country's production in 2012 came from non-associated formations, according to government figures.
  • The greatest growth potential for Oman's natural gas production may lie in the Khazzan-Makarem field in BP's Block 61. The field is a tight gas formation, and BP suggests that there are between 15 and 20 Tcf of recoverable natural gas resources in the play, and up to 100 Tcf of natural gas in place. The development plan anticipates first volumes in 2017, with eventual production of 1 Bcf of natural gas per day and 20,000 bbl/d of condensates.
  • Oman also has a gas-to-liquids (GTL) program, whereby Oman LNG supplies more than 250,000 tons of natural gas liquids (NGL) per year for transformation into motor gasoline. Despite this effort, Oman still faces a shortage of transportation fuels because of insufficient domestic refining capacity.

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