BP Awarded Two Natural Gas Concessions in Oman

DUBAI, Dec 18, 2006 (Dow Jones Newswires)

BP PLC (BP) has been awarded two natural gas concessions in central Oman, an Omani official said Monday.

"The concessions will be finalized any time now. It is just a question of crossing the t's and dotting the i's," Khalifa al-Hinai, technical advisor at the Ministry of Oil and Gas, told Dow Jones Newswires.

"We submitted bids and we are holding talks with the government of Oman. We cannot speculate on the outcome," said a BP spokesperson in Abu Dhabi.

Al Hinai said BP will begin appraisal drilling next year. "BP wants to do seismic first, from mid-2007," al-Hinai said. "This will take around six months. If everything goes well, production will commence in three to four years."

Al-Hinai said the gas will be used for the Sohar industrial port. "Priority will be given to industries other than liquefied natural gas," he said. There is already a pipeline connecting the central fields to Sohar, in the north of Oman.

Just a few wells have been drilled in the fields until now, al-Hinai said. "The gas is deep and in tight reservoirs. The expertise was not there within PDO (Petroleum Development Oman, in which the Oman government has a majority stake with Royal Dutch Shell PLC (RDSB.LN), Total SA (TOT) and Partex holding smaller shares)," he said.

The ministry is tendering three more oil and gas concessions, which will be awarded some time next year, al-Hinai said.

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