MEOG: Maha’s Mafraq farm-down

Swedish explorer Maha Energy has farmed down a 35% stake in Oman’s Block 70 exploration and production-sharing agreement (EPSA) to local firm Mafraq Energy. Following the deal, which remains subject to Omani government approval, Maha will hold 65% in the concession and remain operator.

Block 70 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.

According to a press release this week, Mafraq Energy will “reimburse Maha for their prorated share of all past costs including the signature bonus [and …] will also be required to pay their share of all future expenditures on Block 70”.

Maha CEO Jonas Lindvall said: “We are delighted to have Mafraq Energy LLC join us on Block 70. Mafraq Energy LLC brings extensive experience of the Mafraq field and the surrounding areas in Oman. The fact that Mafraq Energy joins us is perhaps the best evidence yet of the future potential of the Mafraq field.”