Malaysia’s state-held Petronas has acquired a 10% stake in BP PLC-operated Khazzan field in the Oman Desert 350 km south of Muscat (OGJ Online, Sept. 25, 2017). Petronas unit PC Oman Ventures will acquire the share in Block 61.
BP currently holds 60% interest in the Khazzan project, which encompasses Khazzan and Makarem tight gas fields. State-owned Oman Oil Co. Exploration & Production (OOCEP) holds 40%.
“The announcement highlights Petronas’ strong appetite for international business development and gas resource capture, coming less than 6 months after it joined Shell’s LNG Canada project,” said Max Petrov, part of Wood Mackenzie Ltd.’s corporate analysis team.
“We believe the company is buying into the project for its strong gas reserves potential. The size of resource on Block 61 means that future phases could be developed, beyond the current expansion, provided the partners can secure a buyer for the additional gas.”
For Petronas, the field could contribute 2% of Petronas’ global output by 2023.
For OOCEP, the deal “could be worth in excess of $1.3 billion,” an important consideration as spending on Khazzan’s second phase, Ghazeer, ramps up, said Liam Yates, WoodMac analyst for the Middle East and North Africa upstream.
“Khazzan recently celebrated 1 year of gas delivery in Oman, with field output around 1 bcfd. When Ghazeer comes onstream in the early-2020s, output will increase to 1.5 bcfd,” he said.
According to OOCEP, more than 300 wells will be drilled over Khazzan field’s estimated lifetime.
