OMAN: 50 bn barrels potential reserve

Wednesday 14th, August 2013 / 00:25 Written by Oman Observer 

in Head stories, Main

5 bn barrels are ready for production as technology comes handy -

By Shamsa al Harthiya -

MUSCAT — The Sultanate’s potential oil reserves are estimated 

at 50 billion barrels, of which 5 billion barrels are ready for 

production, said Nasser bin Khamis al Jashmi, Under-Secretary 

of the Ministry of Oil and Gas.
In an interview with Oman, Arabic sister daily of the Observer, 

Al Jashmi said that 7 to 8 billion barrels of oil were produced 

over the past few years, noting that exploration
programmes are progressing well and the production technology 

is being developed.
The official ruled out any concerns about British Petroleum. 

He denied any dispute with the company’s investment in the 

field of gas, saying that the company is extracting gas and 

selling it to the Omani government and that there is ongoing
negotiation about the price of gas which the company will 

sell to the government.

A preliminary agreement has been signed by the company 

with the government and that negotiation is about the final 

draft of the agreements.
He pointed out that no specific model is applied to all 

agreements signed by the government with the company 

investing in oil as far as quotas are concerned. 

That depends on the volume of competition between companies 

and also on the concession area, said Al Jashmi,
who explained that some companies offer the government 

60 per cent and some 70 per cent.
Sometimes the government’s share is calculated in terms of 

number of barrels extracted per day.
The under-secretary reaffirmed that the government does not 

bear any cost or risks incurred by exploration or its expenses.
About other aspects of oil production, Al Jashmi said that 

Al Duqm Refinery is in the stage of studies and designs and 

the capacity will be about 230,000 barrels a day and it is 

meant to meet local need for oil products, as well as the 

setting up of petrochemicals plants to operate alongside the 

refinery to maximise revenue and support the national economy.
It is also designed to receive oil from abroad and it is expected 

to start operations in 2017.
Speaking about Sohar Refinery, Al Jashmi pointed out that its 

slowdown was due to change in the characteristics of Omani 

oil which made its efficiency below expected upgrade standards. 

The refinery was designed initially to deal with specific types of oil, 

but, due to the entry of heavy crude in it and the increase of 

production from Makhaizna oilfield, the refinery’s efficiency was 

affected, though it did not stop production altogether. In reply to 

a query about the extent to which labour strike impacted the oil 

sector last year, Al Jashmi admitted that the oil sector was affected. 

He said that it is natural any strike would affect the production of 

any company and the oil sector in Omani was no exception.

Workers’ demand for their rights is guaranteed by law, but it should 

be routed through proper channels and proper application of law 

should be observed, Al Jashmi said.
Asked whether the issue was resolved, he said that follow-up is 

being made with the Ministry of Manpower and other departments 

concerned to check the extent to which the companies have honoured 

their obligations towards workers.
He added that the oil companies concerned are working to provide 

suitable conditions to encourage workers to continue in the oil and 

gas sector which, he said, is one of the most attractive sectors due 

to its high salaries.
Focus is being made on providing a suitable working milieu to mitigate 

the challenges and enable workers to increase productivity, said Al Jashmi.