Energy
From The Report: Oman 2018
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The strong headwinds of 2017 in Oman’s oil and gas sector have spurred the authorities to develop new sources of revenue. Despite recovering to 2015 levels of $55 a barrel, the steep fall in prices that saw Omani crude fall from $103 per barrel in 2014 to $40 in 2016 has squeezed state finances and added urgency to diversification efforts. On the back of a drop in crude output – following an agreement with the Organisation of the Petroleum Exporting Countries (OPEC) – overall economic growth in Oman remained flat in 2017, at roughly 0.3%, its weakest performance since 2011. However forecasts suggest growth will recover to 2.8% over the course of 2018, as gas production – particularly at BP’s new Khazzan gas field – expands and the non-oil economy steadies. This chapter contains an interview with Yousuf Al Ojaili, President, BP Oman.

Articles from this Chapter

Overview

Powering ahead: As new developments come on-stream, revenues generated from hydrocarbons are set to pick up in 2018
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The strong headwinds of 2017 in Oman’s oil and gas sector have spurred authorities to develop new sources of revenue. Despite recovering to 2015 levels of $55 a barrel, the steep fall in prices that saw Omani crude fall from $103 per barrel in 2014 to $40 in 2016 has squeezed state finances and added urgency to diversification efforts. On the back of a drop in crude output – following an agreement with the Organisation of the Petroleum Exporting Countries (OPEC) – overall economic growth…

Interview

Diverse interests: Yousuf Al Ojaili, President, BP Oman, on sectoral developments and the need to establish sustainable alternatives
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Interview:Yousuf Al Ojaili How will the Khazzan gas field contribute to economic development and diversification? YOUSUF AL OJAILI: The exploitation of Khazzan’s gas fields is of great importance to Oman’s economic development and the sultanate’s diversification programme. Khazzan’s exploitation will reduce the gas deficit for years to come, by extracting volumes of gas which are significantly greater than the sultanate’s current levels of gas production. The production of natural…

Analysis

Inaugural export: For the first time in recent history, Oman is producing more natural gas than domestic demand
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Used as a primary fuel resource in power generation, water production, and upstream and downstream hydrocarbons activities, natural gas is central to Oman’s economy. The sultanate has always run at a natural gas capacity shortage and has historically relied on partially state-owned Petroleum Development Oman (PDO) to produce 70% of the country’s gas requirements. PDO produced an average of 82m cu metres per day in 2017, up from 80.2m cu metres per day in 2016, when the country also imported…

Analysis

Maritime oil: New crude oil storage facility and developments at existing terminals set to raise energy trade profile
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As part of Oman’s broader strategy for economic diversification, efforts to position the sultanate as an international centre for the storage of crude oil and its derivatives are well under way. At the heart of the country’s appeal is its strategic location, which offers easy access to a range of markets in South Asia, the East and Africa, as well as land and sea access to producers in the Middle East. Regional oil producers benefit from being able to store oil more than 1000 km outside…

Analysis

Exploratory endeavours: As operators shy away from oil exploration, the government is working to incentivise new activity
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Offering no major baskets of reservoirs or readily accessible resources waiting for discovery, Oman is generally a challenging geography for oil exploration. With the majority of the country’s onshore sweet oil having been identified and exploited, most of the remaining open concession blocks in the country tend to be better suited to operators with experienced subsurface teams that have access to the technology needed to unlock potential in unconventional deposits. Oil exploration companies…