Muscat – Oman’s Ministry of Energy and Minerals (MEM) on Thursday signed an exploration and production sharing agreement (EPSA) with Shell Integrated Gas Oman, a subsidiary of Shell Plc, along with its partners OQ and TotalEnergies to explore, appraise and develop natural gas resources and condensate in Block 11.
As per the agreement, Shell with a 67.5 per cent working interest will be the operator of Block 11. TotalEnergies and OQ will hold 22.5 per cent and 10 per cent interests, respectively.
The EPSA exploration activities will see seismic acquisition of 1,400sqkm in late 2022, with few planned exploration wells to follow.
In a press statement, H E Eng Salim bin Nasser al Aufi, Oman’s Minister of Energy and Minerals, said, “There is a continuous focus in MEM on enhancing the natural gas reserves of Oman through exploration and appraisal activities undertaken by several companies in the country. This agreement strengthens the strategic relations with partners in the sector such as Shell, TotalEnergies, OQ and others to ensure Oman’s energy security and attract more foreign investment, adding the highest value to the local supply chain.”
Walid Hadi, Shell’s senior vice president and country chair in Oman, said, “Block 11 is located in the western side of the sultanate, in and around the Umm as Samim Sabkha. Shell’s entry into this block signifies a further commitment to Oman, while enhancing and diversifying its gas supply. For Shell, this partnership will strengthen our integrated gas business and generate value for Oman and our shareholders.”
As per the companies, Block 11 contains undeveloped discoveries and exploration potential.
In a statement posted on TotalEnergies’ website, Laurent Vivier, the company’s senior vice president Middle East and North Africa – exploration and production, said, “Our recent activities in Oman are a demonstration of TotalEnergies’ strategy of transformation into a multi-energy company. Today’s entry into the Block 11 gives us the opportunity to unlock additional potential to meet domestic and export gas demand. It strengthens our strategic relationship with Oman, as illustrated last December by our entry into the neighbouring Block 10 gas concession and the start of construction last July of 17-megawatt-peak solar photovoltaic systems providing power to a desalination plant.”
Block 11 is located in Al Wusta region, adjacent to Block 10, around 400km from Muscat. Block 11 covers an area of around 2,900sqkm.
Shell has been a partner in Oman’s development and progress over the last several decades. The company is active in Oman across the oil and gas industry and is involved in joint venture and independent activities ranging from research and development, exploration and production to trading, retail and new energies.
Shell holds interests in Petroleum Development Oman (34 per cent), Oman LNG (30 per cent) and Shell Oman Marketing Company (49 per cent). Oman Shell is the operator of Block 10 following a concession agreement that was signed in December 2021. Shell is also exploring Blocks 42 and Block 55 in the sultanate.
In December 2021, French energy giant TotalEnergies also signed the concession agreement to develop natural gas resources on the onshore Block 10 (with 26.55 per cent interest). TotalEnergies also operates exploration Block 12 (80 per cent interest) and contributes to the development of renewables in the sultanate.