MEOG: Maha and Mafraq sign Oman deal

Swedish explorer Maha Energy and local firm Mafraq Energy this week signed a joint operating agreement for Oman’s Block 70 concession following a farm-in deal last year.

Maha operates Block 70 with a 65% shareholding, while Mafraq holds the remainder following its August farm-in to the exploration and production-sharing agreement (EPSA), with that deal requiring the Omani firm to reimburse Maha for its “prorated share of all past costs, including the signature bonus [and …] its share of all future expenditures on Block 70.”

The licence contains the Mafraq heavy oilfield, which was discovered by state-backed Petroleum Development Oman (PDO) in 1988. Between then and 2010, the field was further delineated by four wells and 3D seismic in stages, but never developed owing to low oil prices and the high cost of production.

Maha was awarded a 100% stake in the 639-square km block by the Sultanate’s Ministry of Energy and Minerals in September 2020 following months of speculation.

In a press release issued by Maha this week, CEO Paulo Mendonça said: “We are proud to have finalised yet another major milestone in what is to be a great partnership. Maha is moving forward to commence the testing, aiming for fast production of Block 70 and having Mafraq Energy as its local partner with competent and experienced Omani team, bringing knowledge of the local market to the operations.”