(MENAFN - Muscat Daily) Muscat- The Ministry of Oil and Gas has signed two new oil exploration and production sharing agreements with Occidental Oman and Oman Oil Company Exploration and Production (OOCEP) for the development of Blocks 51 and 65.
Total investment in developing these two new blocks is expected to be around US$65mn in two phases spanning over six years, according to a senior official at the Ministry of Oil and Gas.
H E Dr Mohammed bin Hamad al Rumhi, Minister of Oil and Gas signed the agreements on behalf of the government while representatives from Occidental and OOCEP signed on behalf of their respective companies.
The first agreement was signed with Occidental Oman for the concession Block 51, which occupies an area of 10,133sqkm. The second agreement was signed with Occidental Oman and OOCEP as a joint venture for the concession Block 65, which occupies an area of 1,230sqkm. The agreements were signed on behalf of the companies by executive vice president of Occidental Oman and CEO of OOCEP.
'Under the agreements, both companies have made commitments for carrying out 2D and 3D seismic activities to study geological and gephysical properties and also to drill wells to study potentials of these concession blocks,' Dr Salman bin Mohammed al Shidi, director general of petroleum investment at the Ministry of Oil and Gas said.
He said both companies have signed agreements to make a total investment of around US$65mn in two-phases. 'Out of the proposed US$65mn investment, around US$38mn have been committed for the phase one only. However, the remaining US$27mn will be invested in phase-two depending on progress made in the first phase.'
The activities committed in the agreements include making analysis of present seismic data and carrying out additional seismic activities.
'These studies will give them enough data to drill wells to carry-out the exploration studies. Under the agreements, both companies have to drill 14 wells in the first phase. Nine wells will be dug in Block 65 and remaining five will be drilled in Block 51 concession area,' Shidi said.
He added that Block 65 has the potential for non-conventional or shale oil whereas block 51 has more of gas potential.