OMAN - New E&P Offerings.

The areas relinquished by PDO in early 1995 were made into 11 blocks by the ministry of petroleum and mineral resources, which began offering them in July 1995. A 12th tract, Block 3 relinquished by Amoco, was added to the offer. The ministry also added to the offer a 13th tract relinquished by Occidental. The tender was in Oct. 1995 as the ministry released technical information on each of the blocks and allowed companies to view the data on its premises. The closing bid date, originally set for Feb. 17, 1996, was extended to March 2. Eight of the blocks were onshore in the south, and five were offshore. The size of each onshore block in Dhofar province had been enlarged to attract interest in a region where the oil is heavy and some areas are gas prone. Of the eight onshore blocks, five are along the border with Yemen - one of these is close to Oman's triangle bordering Saudi Arabia and Yemen. The other three are in more central areas. The five offshore blocks are located in the Strait of Hormuz, the Gulf of Oman and the Arabian Sea.

Total was the first on July 9, 1995 to get Block 4, 26,000 sq km, at Saiwan in central Oman near the giant Saih Rawl and Barik gas fields. It was to drill 2 wells before end-1998. Oil India got 20% in Block 4 in Sept 1998. Elf, with Sumitomo and Wintershall, in Sept. 1995 got a block adjacent to its Sahmah tract in W. Oman. Its first well was drilled in 1997. But Elf sold its interests in Oman to Petrogas (see Part 2). Japex on June 5, 1996 got the 6,478 sq km Block 35 in the S-W near the Saudi border. It was to spend $45m in 7 years and drill 6 wells. Phillips on June 15, 1996 got the 18,527 sq km Block 36, on the Saudi/Yemeni borders, and was to spend $37m in 9 years and drill 5 wells. In 1997 Maersk Oil & Gas bought 25% in this concession. In June 1999 Phillips got Block 38 in the S-W, 18,000 sq km, under a 10-year PSA, and was to spend $29m in the first 3 years and to begin drilling in 2000. It will have 40% of any finds. Arco and Partex got the 3,800 sq km Block 32 in the N-E. It was to spend $41m in 7 years and drill 5 wells. Nimir Petroleum of Saudi Arabia on Jan. 25, 1997, took the 15,000 sq km Block 3 in the N-E left by Amoco. It was to spend $50.5m in 8 years and drill 6 wells. Gulfstream Resources of Canada in mid-1997 got the 1,200 sq km Hofar Block 30 in the north. It was to spend $20m in 6 years and drill 3 wells.

Occidental (Oxy) on Sept 29, 1997 got the 7,157 sq km gas-rich Block 31 in the N-W. It was to spend $45m in 7 years and drill 3 wells. In June 1998 it got a 2,485 sq km gas-rich Block 27 in adjacent to its producing tract and Block 31, and was to spend $25.5m in 9 years. Oxy is the second biggest oil producer in Oman next to PDO (see Part 2). In June 1998 Amoco got gas-rich Blocks 15 and 44 in June 1998. In April 1999, a consortium of BP Amoco (60%), Oxy (26%) and Fortum (ex-Neste of Finland, 14%) signed a deal to explore and develop gas in Blocks 9, 15, 27, 31 and 44, as well as process and supply 400 MCF/d to Oman's industrial town of Sohar and BP Amoco's hub in Sharjah and other UAE emirates. The group is to build a processing plant and pipelines.

Triton Energy of Dallas in June 1996 was the first company to take one of the five offshore blocks on offer. It got gas-rich Block 22, 8,271 sq km, near Masirah island in the Arabian Sea and was to spend $38m over 8 years and drill 5 wells. It was the first time Triton got an oil concession in the Middle East. The company has participated in several major discoveries in Latin America, including the Cusiana and Cupiagua fields in Colombia. In June 1998 Triton got offshore and gas-rich Block 40, 5,353 sq km, in the Hormuz Strait. It was to spend $30m in 8 years and drill 4 wells. In March 1999 Shell got offshore Block 18 near the Batina coast, where it was to spend $3m in a 3-year exploration programme.

Novus Petroleum of Australia in 1997 bought the 30% equity of International Petroleum Corp. (IPC) of Canada in the Bukha offshore concession, where gas and condensates are being produced. The deal raised Novus' stake in Bukha to 40%. The other partners are LG Group of South Korea (50%) and Heritage Oil & Gas of the UK (10%).