PDO offers acreage within Block 6 concession

Petroleum Development Oman (PDO), the Sultanate’s main oil and gas producer, has signalled a strategic move to attract external expertise for a substantial hydrocarbon asset within its core Block 6 concession.

The majority state-owned enterprise is inviting Expressions of Interest (EoIs) from both domestic and international energy firms to develop Area A, a 130 square km parcel in the Qarn Alam Cluster, located within the historically productive Ghaba Basin.

In a press release on May 22, PDO highlighted the scale of the opportunity: “This represents a strategic opportunity to access a discovered resource with more than 1 billion barrels of STOIIP (stock tank oil initially in place), located within Area-A, which spans over 130 km2. The area offers proximity to existing infrastructure and holds significant development potential.” Interested parties have until June 5 to submit their interest and demonstrate relevant operational capabilities.

Block 6 is central to Oman’s energy landscape, accounting for the lion’s share of the nation’s oil reserves, estimated at over 75%, and boasting a production capacity of approximately 650,000 barrels per day.

Industry analysts suggest this initiative aligns with PDO’s established strategy of engaging specialist operators to maximise value from specific assets, allowing the national oil company to concentrate on its largest and most complex undertakings.

This approach was notably employed in 2006 when Indonesia’s MedcoEnergi was brought in to manage the KSF cluster, a collection of 18 smaller, mature oilfields in southern Oman. That service agreement, which saw MedcoEnergi assume full operational duties while PDO retained hydrocarbon ownership, was extended in 2015 for an additional 25 years. A similar model is utilised for the Rima Cluster, managed by Daleel Petroleum, targeting mature fields requiring agile and cost-effective development strategies.

However, the anticipated arrangement for Area A is expected to transcend a conventional service contract. Market observers predict a more comprehensive partnership model that would incentivise the incoming operator for deploying proprietary technologies and making significant financial and technical contributions.

The Ghaba Basin, while a cornerstone of PDO’s output, presents considerable geological challenges, with complex structural traps and varied reservoir types. Unlocking its full potential necessitates substantial investment and advanced technological know-how.