FTSE 100 oil major BP yesterday said it has signed 30-year sales and production sharing agreements with Oman’s government to develop the Khazzan gas field.
It is hoped that the project – which is estimated to cost around $16bn (£9.8bn) – will become a major new source of gas for energy-hungry Oman over the next few decades. BP will operate the gas field and hold a 60 per cent stake. The state-owned Oman Oil Company Exploration & Production will own the remaining 40 per cent.
Construction work will begin in 2014 and production will start in late 2017. In total the project is expected to develop around seven trillion cubic feet of gas.
“The Khazzan project is the largest new upstream project in Oman and a pioneering development in the region in unlocking technically challenging tight gas through technology,” said Dr Mohammed Al Rumhy, Oman’s minister of oil and gas.
BP chief Bob Dudley said: “This enables BP to bring to Oman the experience it has built up in tight gas production over many decades.”