Investment in Petroleum Industry Sultanate of Oman
Sultanate of Oman is located on the southeastern coast of the Arabian Peninsula. The Sultanate coast is formed by the Arabian Sea on the southeast and the Gulf of Oman on the northeast. The year 1967 marks the first crude cargo from Fahud field through a pipeline of 276 km to Mina Al Fahal. The cargo was 543,800 oil barrels. In 1970 there was one concession block covering the whole Sultanate, operated by one company and only 3 oil fields. Today, there is around 50 concession blocks operated by more than 20 operators running over 300 oil and gas fields. Since then, petroleum industry is prospering with increased oil and gas production rates.
Why to Invest in Oman Petroleum Industry?
Peaceful and Tolerant Nation
Oman has always been peaceful, tolerant and non-controversial nation. The inclusion and tolerance of the Omani people as a whole is a positive example of the opportunity that lies ahead for investors in the sector both internally and from outside. Religious freedom is guaranteed in the Sultanate, based on the historical tradition of acceptance, understanding and peaceful coexistence between its various religious communities. In the Middle East, Oman well known by its stable political regime, away from troubles, good neighborhood with its neighbors, and excellent political relations with other countries of the world, which in turn qualified the country to be a perfect place to invest especially in energy and petroleum sector.
Open for All Competitors and Trusting Business Environment
Investing in Oman petroleum concession blocks is open for all international and local oil and gas players. Such investments contribute to the investor returns, government returns and support increasing the in-country value. With mutual relation with government and no micromanagement it insures a trusting and prosperous business environment
Sizable Conventional and Unconventional Resources
Oman subsurface is marked by one of a kind variety of subsurface formations extends from Neoproterozoic (Basement of ≈ 800 Mln years old) to Cenozoic. Combined with a variety of structural elements it creates a magnificent hydrocarbon traps and hence, hydrocarbon fields (Figure 1). Through the government’s close coordination and support of local and international investors, operators in Oman were able to unlock oil resources by using innovative Enhanced Oil Recovery (EOR) technologies including polymer, miscible and steam injection such as Marmul polymer, Qarn Alam steam and Rabab-Harweel Integrated project. On the gas side, there are great growth potentials in tight gas resources in North of Oman such as Khazzan, Ghazeer and Mabrouk North East discoveries. With the variety of data including well penetrations and seismic coverage, a variety of evaluation methods can be performed to identify the potential hydrocarbon sweet spots.
Exploration and Production Sharing Agreement (EPSA)
The Exploration and Production Sharing Agreement (EPSA) is one type of petroleum contracts in the E&P business that is involving two parties (the Government and Contractor); where the entire risks associated with costs of exploration, production and development is incurred by the Contractor in return for its specified profit-share percentage of hydrocarbon production resulting from this agreement. The contractor incurred costs are recoverable in the event of discovery hydrocarbon accumulations in commercial quantities. Thus, in the Sultanate of Oman, the EPSAs are characterized by their win-win nature, where it is mutually beneficial to both parties with acceptable outcomes. EPSAs are also characterized by their adaptability nature, where it is customized, among the two parties, to perfectly fit the current and or future conditions. Correspondingly, EPSAs are characterized by their evergreen nature; where its tenure is automatically renewed for some period of time, upon the expiry of the agreement, in the event of uncompleted petroleum activities that are occurring on the ground. For more information about the Exploration and Production Sharing Agreements (EPSAs), latest updated Oman concession map and the steps to acquire a concession block in the Sultanate of Oman, kindly, visit the “Petroleum Concessions” section.
Fully Developed Oil and Gas Infrastructure
The government paid much attention to provide complementary infrastructure such as paved ways, ports, airports, advanced communication network, advanced banking services and establishing free zones and basic infrastructure projects. This shall insure the required logistics for the petroleum industry activities. The Government has adopted the idea of establishing some free zones in different parts of the Sultanate such as Salalah Free Zone, Sohar Industrial Port, Mazyona Free Zone and Masandam Free Zone. In addition, the Sultanate has joined many international organizations, World Trade Organization, Free Trade Agreement with the United States of America, plus revising a number of laws and legislations to match up with the requirement of globalization and the merger into the world economy. This is in order to prepare the circumstances for the private sector so that it will be able to deal with the requirements of the full liberation of the markets and freedom of transfer of goods, services, and capitals.
Mature Oil and Gas Services Sector
Oman’s success in attracting number of international players during last decades was a testament to the Sultanates continuing appeal to international oil and gas services providers. Starting from field trials to full deployment, the country has become an incubator for cutting-edge technologies and new techniques that have set new industry standards for efficiency and innovation that made the service sector a pillar in the oil and gas sector successful journey in the Sultanate. The Sultanate has been maximizing investment capabilities emerging technologies from around the world. In parallel, Oman has developed a mature sector with a tangible integration between international and local contractors to further drive investment and spur economic growth. The range of services provided by contractors is broad and reflects the growing strength and capability of local Omani businesses servicing the energy sectors. In addition, new firms and players can take advantage of a welldeveloped regional labor force and supply chain
Availability of Omani Experts
Oman Youth are keen to contribute to the development of the country, more than 60% of Omani youth are enrolled in higher education, statistics released by the government show. Moreover, 17% of all entrepreneurs in Oman are between the ages of 18 and 29, while about 30% of the country’s youth have volunteered to help society. Omani youth are the future of the country. They form the pillars of our nation. They will definitely take the nation forward in the years to come. A number of Omanis are qualified in a wide variety of disciplines by which they can serve the petroleum industry either in upstream, midstream or downstream. Combined with effective training programs provided by the companies and different government initiatives to develop the employees. The increased number of Omanization in the sector indicates their growing experience and ability to contribute and lead the operational activities. Their valuable contributions will undoubtedly boost the country economically and socially. The bright minds and aspirations of Omani youth are a source of continuing pride in the journey of Oman Vision 2040.
For more queries Contact us Ministry of Energy and Minerals Sultanate of Oman