BP and Eni agree on production and exploration for Block 77 in Oman

Multinational oil and gas company BP and Italian firm Eni have signed an exploration and production sharing agreement (EPSA) with the Ministry of Oil and Gas of the Sultanate of Oman for Block 77.

BP and Eni will each own a 50% interest in the EPSA, with the latter acting as the operator during the exploration phase.

The agreement for the new exploration opportunity follows from the heads of agreement (HoA) for the block signed by the two companies in January.

BP group chief executive Bob Dudley said: “Today’s announcement reflects the continued exploration potential we see in Oman and reinforces BP’s commitment to the Sultanate of Oman.

“We look forward to working with the government and Eni to continue to explore and develop the country’s resources and secure its long-term gas production.”

With a total area of almost 2,700km², Block 77 is located 30km east of the 2,850km² Block 61 operated by BP.

Block 61 contains the already-producing Khazzan gas project, as well as the Ghazeer project that is currently under development.

In 2013, BP signed gas sales agreements and approval for the development of the Khazzan project on the block.

Block 61 is operated by BP with a 60% stake. The Oman Oil Company for Exploration & Production and Petronas’ wholly owned subsidiary PC Oman respectively own 30% and 10% interests.

The first phase of the Khazzan project became operational in 2017 within budget and ahead of schedule.

Construction on Ghazeer, the second phase of development on Block 61, is currently underway. It is anticipated to come online in 2021.

At present, Khazzan produces more than one billion cubic feet of gas a day (bcf/d), while Ghazeer is expected to add a further 0.5bcf/d production.