Muscat: Oman’s daily average crude oil production is expected to plateau at 950,000 barrels per day (bpd) during the next three to five years, but the country faces several challenges in the natural gas sector, said a senior official at the Ministry of Oil and Gas.
Addressing a panel discussion on the oil and gas industry’s forecast and plan until 2020, which was organised by the Oman Society for Petroleum Services (Opal) here, Salim bin Nasser Al Aufi, undersecretary at the Ministry of Oil and Gas, said there is a lot of potential for enhancing oil production. “Every company has potential to produce more.”
“The cost is coming down. Currently, our operating cost is just less than $9 per barrel. Our unit expenditure for the year is probably between $23 and 25 per barrel,” he said, adding; “Going forward, the challenge is not in oil sector, but in the gas field. Today, we are in a completely different position. We have enough gas to supply for local industries.”
The undersecretary further said that challenge will be after seven or eight years from now since the gas business is a long-term commitment. Once the contract is secured, the country needs to supply for a long period since gas contracts are long term in nature. “Now the challenge is what to do with the excess gas without losing value and in future, how to maintain the position of surplus gas. In the next few years, our challenge is less in oil and more on gas.”
Al Aufi added that the ministry will also face challenges in enhancing the skill levels of the Omani workforce. The ministry has to work with universities to raise the quality of Omani manpower joining the workforce.
The country needs to provide jobs for 25,000 young jobseekers every year and the oil and gas sector has its share.
The undersecretary also noted that the ministry plans to award four oil blocks. In the first quarter of next year, the ministry will start negotiations for awarding the concession to multinational firms.
Al Aufi further said that another challenge is the complexity of reservoirs, primarily tight gas fields, in Oman. So, the challenge is to include little more incentives for international and local companies interested in bidding for oil blocks in Oman.
Apart from Al Aufi, Raoul Restucci, managing director, Petroleum Development Oman, John Malcolm, chief executive officer, Oman Oil Company Exploration and Production, Steve Kelly, managing director and president, Occidental of Oman Inc., Dr. Amer Al Rawas, chairman, Opal and Mohammed Al Jahwari, chief executive officer, HydroCarbon Finder Oman, also attended the panel discussion. The panel discussion was monitored by Mohammed Al Kharusi, chairman, Interseach ME Oman.