Oman’s Ministry of Energy and Minerals signed on Monday an Exploration and Production Sharing Agreement (EPSA) with local upstream firm Majan Energy for the development of Block 71, which contains the ultra-heavy oil Habhab field.
Dr Mohammed bin Hamad al Rumhy, Minister of Energy and Minerals, inked the pact on behalf of the Omani government. Majan Energy was represented by its CEO Eyhab bin Adnan al Hajj.
Covering an area of 282 sq kilometres in the south of Oman, Block 71 was carved out of the sprawling Block 6 license of Petroleum Development Oman (PDO).
Dr Salman bin Mohammed al Sheedi, Director General of Oil and Gas Investments, said in a statement to Oman News Agency (ONA) that Majan Energy will spend between $15 – 20 million in the initial phase of the agreement to undertake geophysical studies as well as drill a number of exploration wells aimed at chalking a plan to unlock the Habhab field’s heavy oil potential.
The company will also pilot the use of experimental enhanced oil recovery (EOR) technologies during this phase. The local company will be supported by its partners in China in the deployment of these new technologies, he said.
Majan Energy’s Eyhab al Hajj said the company is hopeful of producing the Habhab field’s heavy oil, having spent the past three years testing new technologies to this end. The Block’s prodigious heavy oil potential also provides strong economic incentive to invest in this concession, he noted.