Muscat: The price of Oman oil rose above $60 a barrel when it increased by 76 cents to reach the highest it has been in a year’s time.

The price of Oman crude on February 9 stood at $60.50, according to the Dubai Mercantile Exchange, after hovering around the $58 mark for the last few days.

Speaking exclusively to Times of Oman, Ali bin Abdullah Al Riyami, Director General of Oil and Gas Marketing at the Ministry of Energy and Minerals, said: “Today, the price of Omani oil has reached $60.50 a barrel. This rise shows improved expectations for the recovery of world economy and global demand for oil, particularly in Asia.”

He said that the efforts made by the Organisation of Petroleum Exporting Countries and its allies to cut production has also led to recovery in oil prices, especially after Saudi Arabia announced that it has decided for additional voluntary reduction of one million barrels per day during February and March 2021.”

As it is known, every increase in the price of a barrel will contribute to the government’s oil revenues, which will be reflected in the rebound of the market and the recovery of Omani

economy, he added. “It is worth noting that the price of Oman oil in December 2019 reached $ 60.26 and for your information, in the same year, the price in August reached $ 69.99,” he added.

The average price of Oman oil scheduled for delivery in February 2021 stabilised at $50, a good $6.17 higher than the average price of oil scheduled for January.

The production of Oman crude has risen, according to figures from the Ministry of Energy and Minerals. Production in the country stood at 730,459 barrels a day in January 2021.

Source: Times of Oman

Muscat: Gas production has commenced in Oman from the Ghazeer field ahead of schedule, the Ministry of Energy and Minerals said on Monday.

“Following the successful startup of Khazzan in 2017, we are pleased to announce along with our partners BP Oman and Petronas, the commencement of gas production from Ghazeer ahead of schedule which will add another 0.5 bcf/d and over 30,000 bpd condensate production,” the ministry said.

“I am delighted to see BP Oman bringing the Ghazeer gas field online – it’s an important project for Oman and we are extremely proud of it, gas from Ghazeer will contribute towards Oman’s 2040 vision in terms of providing additional energy to local industries,” Dr. Mohammed al Rumhy, Minister of Energy and Minerals said in a statement.

Ghazeer was initially expected to come into production in 2021. The first phase of development of Block 61 – Khazzan – was brought online in September 2017.

Bernard Looney, BP chief executive, said: “The start-up of Ghazeer is an important milestone in our strategic partnership with Oman, delivering critical national infrastructure for the Sultanate.

We appreciate the collaborative support we have received from the government of Oman and our partners in delivering this significant start-up safely and ahead of schedule,

particularly as Oman prepares to celebrate its 50th national day.

“When we introduced our plans to reinvent bp, we were clear that to deliver them we have to perform as we transform. There are few better examples of how we are doing just that than Ghazeer. This project has been delivered with capital discipline four months early, wells are being drilled in record times and, importantly, safety performance has been excellent. It exemplifies what a strong and resilient hydrocarbons business looks like – a core part of our strategy.”

Total production capacity from Block 61, comprising both Khazzan and Ghazeer, is expected to rise to 1.5 billion cubic feet of gas a day and more than 65,000 barrels a day of associated condensate.

With an estimated 10.5 trillion cubic feet of recoverable gas resources, the block has the capacity to deliver approximately 35 percent of Oman’s total gas demand.

Adopting experience from bp’s onshore operations in the US, Ghazeer’s wells were tested and completed using the ‘green completions’ concept. Historically, hydrocarbons produced during well testing for new completions would be flared. In green completions, the hydrocarbons are routed to the production facility instead, reducing greenhouse gas emissions.

Since adopting this approach in 2019, 201,000 tonnes of CO2e emissions were saved – equivalent to removing 44,000 cars from the road for a year.

BP prioritises in-country value throughout its projects and operations. During the development of Ghazeer, BP has worked closely with local vendors to develop their capabilities and help them be competitive both in Oman and globally, resulting in a number of contracts and technical scopes moving from international to local Omani contractors.

Updated, industry-leading policies and procedures on workers’ welfare and human rights have also been embedded throughout the project.

As this important first gas milestone is achieved, Omanisation in bp Oman reached over 80 percent.

Omani-registered companies were also used for over 85 percent of all project spend.

Source: Oman Observer

By Laila Kearney NEW YORK (Reuters) - Oil surged about 8% on Monday, putting it on track for its biggest daily gain in more than six months after Pfizer announced promising results for its COVID-19 vaccine, boosting risk assets around the globe. Brent crude was up $3.11, or 7.9%, at $42.56 a barrel at 1:35 p.m.

NEW YORK (Reuters) - Oil surged about 8% on Monday, putting it on track for its biggest daily gain in more than six months after Pfizer announced promising results for its COVID-19 vaccine, boosting risk assets around the globe.

Brent crude was up $3.11, or 7.9%, at $42.56 a barrel at 1:35 p.m. EDT (1835 GMT), while U.S. West Texas Intermediate crude rose $3.31, or 8.9%, to $40.45.

Both contracts rose more than $4 earlier in the session and traded more than 120% of last session's volumes.

"The oil complex is joining in the bullish euphoria of today's optimistic vaccine headlines as well as the weekend election results by trailing the equities higher," said Jim Ritterbusch of Ritterbusch and Associates in Houston.

Pfizer said its experimental vaccine was more than 90% effective in preventing COVID-19 , based on initial data from a large study, a victory in the battle against a pandemic that has forced lockdowns around the world and led to a drop-off in fuel demand.

Wall Street, which oil prices often follow, reached all-time highs after the announcement.

Meanwhile, Saudi Arabia said an OPEC+ oil output deal could be adjusted to balance the market. The kingdom's energy minister Prince Abdulaziz bin Salman said the OPEC+ deal on

oil output cuts could be adjusted if there was consensus among members of the group, increasing the prospect of tighter supplies and higher oil prices.

OPEC+, which includes Organization of the Petroleum Exporting Countries (OPEC) states, Russia and other producers, is currently cutting 7.7 million barrels per day (bpd), and is considering reducing those cuts to 5.7 million bpd from January. If OPEC+ maintains the current curbs on output, it would tighten supply and lead to higher prices.

(GRAPHIC: Global oil supply and demand - https://fingfx.thomsonreuters.com/gfx/ce/oakpenrxzvr/EIA%20oil%20supply%20and%20demand.PNG)

Key members of OPEC are wary of U.S. President-elect Joe Biden relaxing measures on Iran and Venezuela, which could mean an increase in oil production that would make it harder to balance supply with demand.

"While a Biden presidency increases the likelihood of Iranian oil supply returning to the market, this is not something that will happen overnight, and we still believe it’s more likely an end of 2021/2022 event," ING said in a note.

(Additional reporting by Bozorgmehr Sharafedin in Londonand Florence Tan in Singapore; Editing by Marguerita Choy and Chris Reese)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Source: Firstpost

BP Oman company plans to start producing 500 million cubic feet of gas from the Ghazeer project by the end of year 2020. Eng. Yousef bin Mohammed Al Ojaili, Chairman of BP Oman, has said that the company is bracing for the launch of a 500-million-cubic feet gas project (at Ghazeer field) whose installations are 99 per cent ready for the start of production.

Al-Ojaili said that production of gas from the company's Khazzan gas project now stands at 1 billion cubic feet a day and will rise to 1.5 billion cubic feet a day. The company also produces 35,000 barrels of condensates per day, and this rate is set to double by the start of production at Ghazeer gas project, he added. Drilling at the company’s sites progresses at full swing, said Al-Ojaili, noting that 126 wells were drilled at Khazzan and Ghazeer out of a total of 300 wells over 15 years.

Al-Ojaili pointed out that, so far, the company executed $9.3-billion-worth of investments out of target $16 billion-worth of investments planned for Block (61), which houses Khazzan and Ghazeer projects. He reaffirmed that BP Oman is planning to develop its business towards the production of 10.5 trillion cubic feet from renewable gas resources at Block 61 (Khazzan and Ghazeer fields). He pointed out that gas produced by the company will considerably enhance the stability of supplies from local resources.

In 2016, BP and Oman Oil Company Exploration & Production signed a revised petroleum agreement with the Ministry of Oil and Gas to expand the concession area in Block 61 for Khazzan project to ensure developing Khazzan gas project through well-controlled quotas. He explained that, as per the agreement, the expansion will extend the concession area of Block 61 south and west by about 1,000 square kilometres to be added to the project’s existing area of about 2,700 square kilometres.

The expansion will enable BP to start the second phase of developing the field in order to get additional resources of gas in the area demarcated during exploratory drilling operations. OQ Company owns 30 per cent of the project, while Petronas owns 10 per cent and BP 60 per cent.

Government subsidy to Oman’s electricity sector rose 10.9 per cent to reach a record RO 624.69 million (approximately $1.6 billion) in 2019, notwithstanding far-reaching measures adopted in recent years to reduce state assistance to this key industry. A top official of Nama Group (formerly The Electricity Holding Company) attributed the uptick to new investments in power generation capacity as well as the construction of high-voltage transmission infrastructure.

The announcement came at the annual briefing of Nama Group, the holding company of state-owned electricity network companies, on Monday. Presenting the financial performance of the group for 2019, Eng Omar al Wahaibi (pictured), CEO, said Nama Group achieved an operating revenue of RO 1.251 billion last year, down from RO 1.290 billion in 2018, a decline attributable to the implementation of a new International Accounting Standard (IFRS 16). Net profit after tax dipped 15.4 per cent to RO 60.4 million in 2019, compared to RO 71.4 million in 2018.

On the other hand, the impact of IFRS 16 resulted in an increase in the Group’s total assets by 56.3 per cent to RO 6.9 billion in 2019, up from RO 4.4 billion in 2018. The increase in the total assets is primarily driven by an increase in the ‘Right of Use’ of assets of its wholly owned subsidiary Oman Power and Water Procurement Company (OPWP), he stated.

“The Group pressed ahead with the implementation of its integrated strategy to increase operating efficiency and provide safe and sustainable electricity services to all customers in the Sultanate,” said the CEO. Capital expenditure however slumped around 25 per cent to RO 285 million last year, down from RO 378 million in 2018 – a decline attributed to the “maturity of the electricity network and a slowdown in economic growth”.

A key highlight of 2019, Al Wahaibi said, was the successful completion of the partial privatisation of Oman Electricity Transmission Company (OETC), which owns and operates the country’s main transmission grids. Chinese state-owned State Grid International Development Ltd (SGID) picked up a 49 per cent stake company at a cost of around $1 billion.

Nama Group intends to finalise the sale of 70 per cent of its shares in Muscat Electricity Distribution Company (MEDC) in line with its strategy for the privatisation of electricity distribution companies. “It is planned to receive the bids and complete the privatisation transaction in 2020,” said the CEO.

Also making headway is the implementation of the ambitious North-South Interconnection Project, which will link the Main Interconnected System (MIS) with the PDO network and the Dhofar Power System (DPS). Total investment in Phase 1 of the landmark project, which will add 660 kilometres of overhead lines, is estimated at RO 240 million. The project, due for completion in 2023, will enhance the efficiency of the electricity networks and enable the implementation of several key renewable energy initiatives as well.

Following the global oil price drop in 2014, Oman – like the other GCC states – is pushing ahead with its long-term national development plans that seek to diversify the economy.

The oil and gas sector is responsible for much of Oman's economic growth and government revenue; thus, changes in the industry tend to reflect greatly on the sultanate's overall development. Although recent years have seen a strategic shift towards economic diversification, activity in the hydrocarbons sector still attracts a large share of domestic and foreign investment, with this pattern likely to continue for some time. While the recent prolonged downturn in global oil and gas prices, coupled with the steady depletion of domestic resources, has given Oman some cause for concern, there are signs that the industry has turned a corner.

Oman's oil and gas industry will continue to play an important role in the economy and is poised for continued growth, owing to rising global demand leading up to 2050, more buoyant global energy prices, and renewed investment.

"Reserve discoveries, new concessions and efficient technology leverage steady growth in global oil indices." (The Report, Oman 2019, Oxford Business Group)

Currently, there are various projects that are being implemented, which are estimated to be worth US$ 22 billion.

Although hydrocarbon activity still attracts a lion's share of domestic and foreign investment, more efforts are diversified into expanding downstream capacity, heightened use of enhanced oil recovery (EOR) techniques and venturing into natural gas.

INDUSTRY FACTS AND FIGURES

• Oman is planning to invest about US$5.7 billion in 2019 in oil and gas production and exploration activities, nearly 6 per cent higher than 2018.
• The hydrocarbon sector accounts for about US$12.2 billion or 74 per cent of the total US$26.2 billion estimated overall revenue in 2019.
• Oman's real GDP growth is expected to grow by 2.7 per cent in 2019 up from 2.4 per cent in 2018. (Fitch Solutions Group)
• Oman's hydrocarbon production is set to rise considerably in 2019.
• Oman's crude production is seen to rise by 3.1 per cent in 2019, from 0.5 per cent in 2018. Production will largely stem from investments in EOR maturing fields.
• US$ 26 billion worth of mega oil field, petrochemical projects are seen to drive the country's growth.

GOVERNMENT STRATEGY

Highlights:

• Focus on Enhanced Oil Recovery (EOR)
• Renewed investment along with global energy prices
• Industrial developments expand downstream capacity
• Source markets for crude exports continue to widen

Work at the MOG also forms part of the government's long-term development programme, Oman Vision 2020. This roadmap aims to boost the value of non-hydrocarbons economic sectors as a share of overall GDP through a converted process of economic diversification. The oil and gas downstream segment, in particular, is poised to be shaped by this, with petrochemicals and associated industries highly favoured for growth. One goal of Oman Vision 2020 is to reduce crude oil's contribution to GDP to less than 10% by the end of that year, and to raise that of natural gas to 10% and industry to 20%.

GDP GROWTH

Oman's real GDP growth is expected to accelerate this year as a result of rising oil and gas production and robust fixed investments, according to Fitch Solutions Group, an affiliate of Fitch Ratings.

As per Fitch Solutions' forecasts, Oman's real GDP is expected to grow by 2.7 per cent in 2019, up from 2.4 per cent in 2018.

In its Middle East Monitor report, Fitch said Oman's hydrocarbon production is set to rise considerably in 2019, in spite of OPEC's recent decision to reimpose supply restrictions from first quarter of 2019. 'Our oil and gas team forecasts Oman's crude oil production to rise by 3.1 per cent in 2019, from 0.5 per cent in 2018, contributing to strongly improved net exports. Most of this production will come online in the second half of the year and will largely stem from investments in enhanced oil recovery at maturing fields.'

'Natural gas production from the large Khazzan field is also on track to continue expanding in 2019, although we caution that gains will be considerably smaller than they were in 2018', Fitch added.

Major private investments are on track to be implemented over the coming quarters as part of Oman's wide-ranging economic diversification programme. Fitch forecasts the construction sector to grow by 11.5 per cent in real terms in 2019, from 10.4 per cent in 2018 – second only to Qatar among the GCC countries.

'Major projects currently being undertaken include the US$7bn Duqm Refinery and Petrochemicals Complex, set against a 2021 deadline, which recently secured US$4.6bn of multi-source financing; further projects include the US$6bn Liwa Plastics Industries Complex, due for completion in 2020. These projects will contribute to relatively steady progress on the country's broader diversification agenda, which aims to boost output in the manufacturing, tourism and logistics sectors,' Fitch said.

"Oman's fiscal deficit will narrow only slowly over the coming quarters as weakening oil price growth restricts further revenue gains." It expects the sultanate's fiscal deficit at 7.4 per cent of GDP in 2019, down from 8.7 per cent in 2018.

Higher oil prices and better rates of oil and gas production in Oman are likely to provide a boost to the economy during the end of this year and most of the next, a new report has said.

Economic growth will pick up, directly leading to better financial conditions for people in Oman. "Economic growth will pick up over the coming quarters owing to higher hydrocarbon production," said the report. "Natural gas has provided most of the growth momentum in the year till date, thanks to the start of production at the Khazzan field in September 2017, with total national output expanding by 10.8 per cent between January and July." (The Middle East Monitor November 2018, Fitch Solutions)

Financial analysts and economists said this growth would lead to the government pressing ahead with many social and economic development programmes to help residents and citizens in the country and further negate the effects of the downturn.

OIL AND GAS PRODUCTION

Oman's total production capacity currently stands at 1m barrels/day (b/d) of oil (crude and condensates) and 110m cu metres of natural gas per day.

The sultanate's premier oil and gas producer, the state-controlled Petroleum Development Oman (PDO) had announced earlier in the year that, having achieved its highest oil output—610,170 b/d in 2018—since 2005, it intends to further increase production to 670,000 b/d over the next five years.

Natural gas is also playing an increasingly important role in Oman's energy mix, with a production-sharing agreement on the development of the Mabrouk gasfield in north-east Oman expected in late 2019. The sultanate to make steady progress in achieving its production-capacity targets by 2023.

With a total of 19 international and local companies engaged in exploration and production in 2019, state-controlled PDO no longer has the near monopoly on Oman's oil and gas sector it once had. However, PDO (in which the government owns a 60% stake, Royal Dutch Shell 34%, Total 4% and Partex 2%) remains by far the most important player, accounting for about 70% of the sultanate's total oil output and the bulk of its gas production.

Despite ongoing diversification, Oman's economy is still heavily reliant on hydrocarbons, which supplied over 75% of government revenue and over 60% of export revenue in the first 11 months of 2018. The company's current and future production is therefore of enormous importance to the sultanate. PDO's production levels were well above the 550,000 b/d plateau to which PDO committed itself over the past decade. PDO had a virtual monopoly on Oman's gas production until BP's huge Khazzan project came on stream in late 2017; PDO remains the largest producer of gas in Oman. The completion of the Rabab Harweel and Yibal Khuff mega-projects over 2019 21 will ensure that it remains so.

Gas has played an increasingly important role in Oman's energy sector since the early 2000s and this looks set to continue. Plans for Mabrouk North East follow the successful development of the Khazzan gasfield by BP which came on stream in 2017. The second phase of the project, known as Ghazeer, is currently under way and is expected to increase gas production from the Khazzan field from the current level of around 1bn cu ft/d to 1.5bn cu ft/d.

BP expects to invest US$4bn in the Ghazeer project, which was 33% complete in late October 2018; production is expected to start in early 2021. Once complete, the projects will provide a boost to the economy and increase the in-country value of natural gas. Overall, the oil and gas sector will continue to dominate the Omani economy.

• Gas output is projected to overtake crude in Oman by 2023. (Rystad Energy)
• The value of Oman’s natural gas output rose more than 20 per cent to US$ 4.2 billion from US$ 3.5 billion in 2017.
• Oman’s gas production is seen to increase by 130 million cubic meters per day by 2025.
• International players are favoring gas developments in Oman due to the increasingly lucrative domestic gas market and rising global LNG demand.
• There has been an impressive surge in the development of gas fields in Oman and in new gas finds.

DOWNSTREAM

More gas will certainly be required in the future, too, as the sultanate’s new port and industrial area of Duqm takes off. The OOC has outlined some $15bn in investment for this project, with recent moves including the ground-breaking for a $7bn integrated refinery complex in April 2018.

At the same time, Oman Tank Terminal Company is building a $400m crude oil storage terminal at Duqm, with a 10m-barrel capacity for its first phase. The port is seeing the construction of a OR200m ($519.4m) bulk liquid terminal, which will facilitate the export of the petroleum, petrochemicals and chemicals that are produced in the industrial and refining areas of the Duqm Special Economic Zone (SEZ).

The Duqm Refinery Project will double the downstream throughput and drive growth in an array of adjacent segments.

Sohar is implementing a $6.7bn steam cracker and petrochemicals project called the Liwa Plastics Industry Complex. By September 2018 it was reported 67% complete and on track to be delivered for operation sometime in 2020. When it begins operations, the complex is expected to boost plastics production in Oman by some 1.8m tonnes per year.

Liwa has already added greatly to ICV, with 350 small and medium-sized enterprises awarded some $20m worth of contracts during construction through to September 2018. In other works, ORPIC and Spain’s Compañía Logistica de Hidrocarburos inaugurated the $336m, two-way Muscat Sohar Product Pipeline and Al Jefnain fuel terminal in March 2018. This pipeline now delivers about half of the country’s entire fuel needs via the terminal, which has a 170,000-cu-metre capacity.

The Port of Sohar was recently proposed as the future site of Total’s LNG bunkering terminal, which will become part of the downstream ICV add-on to its participation in Block 6 non-associated gas development.

Construction of the $826m Salalah Liquefied Petroleum Gas project is under way in the Salalah Free Zone. Petrofac won the contract to build a $600m LPG extraction plant within the area, which will process 8.8m cu metres per day. The goal is to make Salalah a major global LPG and condensate export hub after the project is completed in 2020.

UPSTREAM

In addition to experiencing heightened award activity, Oman’s upstream industry is perfecting EOR techniques as a method of extracting all possible product from maturing reservoirs. The large quantity of heavy oil in the sultanate – some 40% of known reserves are comprised of this high viscosity variety – is also making EOR an increasingly vital technology, as light oil, which is typically easier and less costly to pump with conventional means, becomes increasingly scarce.

PDO’s investment in such techniques will increase EOR production as a share of its overall output to at least 23% by 2025, a significant increase on 10% in 2018. In addition to this, the company has invested in miscible gas injection, thermal recovery and chemical thickening agents as methods to optimize trapped residue.

Other outfits are also venturing into EOR in Oman. The UK’s Petrofac secured a $265m EOR deal in March 2018 for the development of the Marmul Polymer Phase 3 project, which has some 500 producing and 75 injector wells within its scope.

OFFSHORE

• Oman’s offshore industry is rapidly growing and continues to deliver value for Oman’s future.
• Recent discoveries of hydrocarbon in Oman have led to increased offshore oil production activities in 2019.
• Revenues from Oman’s main offshore producing fields has generated revenues totaling about US$ 1 billion.
• The government is increasing efforts to unlock the multi-billiondollar investment potential of the Arabian Sea and Indian Ocean lapping its shores.

OUTLOOK

Recent discoveries in the north of Block 6 and elsewhere may even give the country enough of a surplus for it to become a more significant LNG exporter, while increasing the domestic petrochemical sector’s share of the global petrochemical market.

The new refinery at Duqm is expected to provide crucial support for the oil segment. Kuwait’s involvement likely means that the facility will retain a bias towards the processing of that country’s heavy crude, while Duqm will also be well situated to harness Oman’s inland fields, which also mostly produce heavy oil.

IOCs and local outfits will continue to follow ICV and Omanisation policies, while also pressing for these to be as flexible as possible, given industry constraints. The pursuit of ICV in particular will mean a much greater tie-in between upstream and downstream operations, with Oman seeking to end a period when much of the benefit from its oil and gas went overseas.

Mergers and acquisitions activity in the hydrocarbons sector increase growth opportunities.

A string of 'strategic growth projects' currently under various stages of implementation at a combined cost of around $26 billion will help sustain Oman's economic diversification, according to the Under-Secretary of the Ministry of Oil & Gas (MOG).

Salim bin Nasser al Aufi said the mega schemes - related to Oil & Gas, refinery and petrochemical investments - will position the Sultanate as a strong player in the energy sector, as well as boost local value creation and employment generation.

"Strategic projects and economic diversification plans in Oman are key," said the Under-Secretary. "Their aim is to make a significant contribution to sustainable development through which the MOG seeks to attract promising investment opportunities, expand investments and work with partners to capitalise on technical expertise in order to help boost local production and create jobs which have so far reached some 6,000 positions," he noted.

Speaking at the Annual Media Briefing hosted by the ministry last Wednesday, Al Aufi listed a number of upstream Oil & Gas developments that are critical to sustaining hydrocarbon output over the long-term.

Notable is the Rabab Harweel Integrated Project (RHIP), being implemented by Petroleum Development Oman (PDO) with an investment of $4.7 billion. Billed as one of the largest Oil & Gas schemes in the Sultanate in terms of capital costs, the integrated project will produce gas and condensates from the Rabab field and oil from the Harweel field using miscible gas injection. The giant scheme is expected to come on stream in June this year.

Equally strategic is PDO's Yibal Khuff project, which is being constructed with an investment of around $2.9 billion. Termed as the "most technically complicated project" in the Sultanate, the Yibal Khuff venture is designed to harness the acid oil and gas potential of the Khuff and Sudair reservoirs. The project is slated to come into operation in early 2021.

In the south of the Sultanate, PDO recently brought into operation its Tayseer acid gas field, which was discovered in late 2014. A preliminary processing plant at site processes hydrocarbons which contain 4 per cent hydrogen sulphate gas, producing 35 million cubic feet of gas and 4,400 barrels of condensate per day. Total investment in the venture was $350 million.

Ghazeer - representing Phase 2 of BP's tight-gas development in Block 61 - is also making headway in its implementation. Work on a new gas processing plant is now well past the midway point. The project will add a further 0.5 billion cubic feet per of gas when the Ghazeer field commences production in early 2021.

Work on a sizeable portfolio of refining and petrochemical projects is also being progressed in Suhar, Duqm and Salalah. Oman Oil & Orpic Group is executing the Salalah Liquefied Petroleum Gas Project at a cost of $826 million. When completed in the third quarter of 2020, the plant will generate revenues of around $200 million annually through the sale of LPG and condensates.

Liwa Plastic Industries Complex (LPIC), another mammoth petchem scheme under construction at Sohar Port at a cost of $6.7 billion, will contribution to the production of polyethylene - a class of plastics that enjoys growing global demand. The project will be ready in Q2 2020.

(Source: www.omanobserver.om)

In tune with its plan to increase spending to boost growth, Oman is planning to invest around RO2.2bn in 2019 in oil and gas production and exploration activities, nearly six per cent higher than the last year, according to this year's budget.

Oil and gas production expenditure is estimated at RO2.2bn in the 2019 budget, said a statement issued by the Ministry of Finance on Tuesday.

'This includes the operational and capital costs of oil and gas production, and expenses required to maintain future oil and gas production as well as enhance oil and gas reserves', the budget statement said.

In the previous year's budget, the government had announced that it allocated around RO2.1bn, around 15 per cent higher than the 2017, for the hydrocarbon, which remains very crucial for a country like Oman. In 2017, the government had allocated around RO1.82bn for the sector.

According to senior officials from the oil and gas ministry, Oman remains one of the few countries across the world who had never scaled back funds allocated for the hydrocarbon sector despite suffering heavily from the sudden fall in global crude prices over the past few years.

While increasing the fund allocation for the oil and gas sector, the budget statement also said that the government will emphasis more on improving efficiency of the sector.

The budget statement said that the government will try to rationalise spending by 'raising the efficiency of spending on oil and gas production, by using the latest methods' of production.

(Source: www.omanoilandgas.com)