Gas fields in Oman that put LNG exports back on track are subject of $2.6Bln stake sale by BP

Tuesday, 09 February 2021
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LNG News Editor: 

UK major BP has sold a 20 percent stake for $2.6 ‎billion to Thailand’s national energy company in key tight natural gas fields onshore the Sultanate of Oman that enabled the Arabian Peninsula nation to stabilize then boost LNG exports over the past three years.

Under the deal with Thailand’s PTT Exploration and Production Public Company (PTTEP), BP will remain operator of Block 61, with a 40 percent interest as it continues its selective divestment programme.

Large area

Block 61, covering around 3,950 square kilometres in central Oman, contains the largest tight-gas ‎development in the Middle East.

The block has already had two phases of development, the ‎Khazzan field, which began production in 2017, followed by the Ghazeer field in October 2020.

“These two developments, targeted at a total of 10.5 trillion cubic feet of gas ‎resources, have a combined daily production capacity of 1.5 billion cubic feet of gas and more ‎than 65,000 barrels of condensate,” explained BP.

“Gas from Block 61 is exported for domestic consumption ‎into Oman’s national gas grid, while also boosting availability of feedstock supply for Oman ‎LNG,” said the London-based major.

BP Trading and Shipping purchases cargoes from Oman LNG under a seven-‎year deal that started in 2018.

Oman is also planning to become a major LNG bunkering nation from its port at Sohar in cooperation with French major Total.

The main Omani LNG export facilities are at the port of Sur and send cargoes to nations such as Japan, South Korea and into the spot market.

The plant comprises the three amalgamated liquefaction Trains of Oman LNG and Qalhat LNG, now producing more than 10 million tonnes per annum.

A de-bottlenecking project, whereby better output can be achieved by fixing inefficiencies, both technical and operational, is increasing Oman’s LNG output to 11.5 MTPA or more.

BP Chief Executive Bernard Looney said he was pleased to welcome Thailand's PTTEP to the ‎successful Block 61 partnership.

“Block 61 is a pioneering development that has applied ‎leading techniques and technologies to maximise efficiency and minimise emissions,” added Looney.

‎“We are committed to BP’s business in Oman and this agreement allows us to remain at the ‎heart of this world-class development while also making important progress in our global ‎divestment programme,”‎ stated the CEO.

The other shareholders in Block 61 are Oman Oil with 30 percent and Malaysia’s Petronas with 10 percent.

BP said it was targeting divestment proceeds of $25Bln by 2025 and most recently completed the sale for $5 billion of the petrochemicals business to INEOS.

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