SEPTEMBER 17, 2023

Maha Energy gets extension for production testing of Block 70

In a significant boost for its bid to unlock the heavy oil potential of its Block 70 licence in central Oman, Swedish-based energy firm Maha Energy says it has been granted an extension by Oman’s Ministry of Energy and Minerals to undertake further activities that would help the company take a pivotal call on whether or not to proceed with the Block’s development.

The extension, albeit a brief three months through to the end of this year, is designed to enable Maha Energy – the operator of Block 70 with a 65 per cent working interest – to carry out “activities and tests necessary to support any decision” with regard to the development of its Mafraq oilfield – a promising heavy oil reservoir.

An initial short-term production test that began in March this year yielded over 4,000 barrels of heavy, high viscosity oil from the oilfield. It buoyed hopes that, upon further validation of these results, it would lead to a Declaration of Commerciality and the eventual full-scale development of the field in Phase 2 of its Exploration & Production Sharing Agreement (EPSA) with the ministry.

But with the first phase itself set to come to an end on October 31, 2023, the company sought an extension to allow for production testing efforts to yield conclusive results.

That extension, granted recently, will now enable Maha Energy to have the inputs necessary to decide one of two options: “a possible declaration of commerciality of Block 70 or relinquishment”, Maha Energy said in a statement on Friday.

The relatively tiny block, covering an area of 639 sq kilometres, is located in the middle of the prolific oil producing Ghaba Salt Basin in central Oman. Its shallow undeveloped Mafraq heavy oil field was discovered by Petroleum Development Oman (PDO) in 1988.

With a viscosity ranging from 11 – 13 API, Mafraq’s crude is characterised as heavy oil but leans closer to Extra Heavy Oil Bitumen, which has a viscosity ranging from 0 to 10 API.