Oman Oil and Gas Upstream Market

Oman Oil and Gas Upstream Market Analysis

The Oman Oil and Gas Upstream Market is expected to register a CAGR of greater than 5% during the forecast period.

The market was negatively impacted by COVID-19 in 2020. Currently. The market has reached pre-pandemic levels.

• In the long-term, supportive government policies, efforts to grow the offshore sector, and upcoming projects are the key drivers for the country's oil and gas upstream market. Also, the increased exploration activities in the country are expected to be the significant driver for Oman's oil and gas upstream market.
• On the other hand, the requirement for high capital investment and a lack of financing due to a global economic slowdown are some restraints for Oman's oil and gas upstream market.
• Nevertheless, many discoveries in recent years and ongoing exploration activities are the key opportunities to provide a significant opportunity for the country's oil and gas industry market players.

Oman Oil and Gas Upstream Market Trends

Onshore Sector to Dominate the Market

• The onshore sector has dominated the Oman oil and gas market in recent years and is expected to continue to do so during the forecast period. The country's oil and gas production comes from onshore oil and gas fields. Offshore oil and gas exploration and production activities in the country are relatively recent and will take significant time to develop.
• The natural gas production in Oman was 41.8 billion cubic meters, a 13% increase from the previous year. It is expected to grow more due to the onset of an increase in exploration activities in the country.
• As of 2022, some critical assets in Oman's oil and gas exploration and production market are Block 6, Khazzan, Mukhaizna, Block 9, Wadi Aswad, Block 3 & 4, Abu Butabul, Karim small fields, Yumna, and Rima Cluster of Small Fields. Block 6 is the top field in the Oman oil and gas exploration and production market.
• Futhermore, in June 2022, the Ministry of Energy and Minerals (MEM) announced that Oman's crude oil reserves stood at 5.2 billion barrels and gas reserves at around 24 trillion cubic feet. Also, the government reported revenues of USD 17.4 billion (and a USD 2 billion surplus) in the first half of 2022 based on an average oil price of USD 87 per barrel, and it is on track to record its first annual surplus in a decade.
• Owing to improved production and revenues, the Onshore sector of Oman is expected to dominate the market during the forecast period.

Increased Exploration Activities to Drive the Market

• The oil production in Oman stood at 971 Thousand Barrels Daily in 2021, an increase of 2% from the previous year. Though there has been a slow growth in oil production in Oman, considering the increasing demand for oil from significant economies, production is expected to ramp up in the future.
• In May 2022, Oman and Iran decided to work jointly on developing the Hengam offshore oilfield in the Persian Gulf. Joint Technical Committee will develop the oilfields in a phased manner. Hengam field is a reserve that Oman and Iran jointly share. The fresh oilfield is expected to make significant production in the future.
• Furthermore, in June 2022, the Ministry of Energy and Minerals stated that it had made new oil discoveries that would raise Oman's production by 50,000 to 100,000 barrels in the coming two to three years. At full capacity, the plant will boost OQ's total production capacity of 219,000 barrels per day of oil equivalent, representing 12.6 % of Oman's total oil production.
• Moreover, in September 2022, Oman signed an exploration and production sharing agreement deal with Shell for Block 11. The exploration activities will undertake the seismic survey of 1,400km², and further well exploration will occur.
• All of the above factors with respect to production & exploration agreements, discoveries, and growing production are expected to help drive the Oman oil and gas market during the forecast period.

Oman Oil and Gas Upstream Industry Overview

The Oman oil and gas upstream market is fragmented. Some key players (in no particular order) are BP Plc, Royal Dutch Shell, Oman Oil Marketing Company SAOC, Total SA, and Eni Spa, among others.

Oman Oil and Gas Upstream Market Leaders

Oman Oil and Gas Upstream Market News

• In November 2022, Masirah Oil, a subsidiary of Singapore's Rex International, commenced the drilling for an exploration well, Yumna Field offshore, Oman. The company is using a jack-up rig from Shelf Drilling. The Yumna 4 appraisal/exploration well on the Yumna field was spudded on 11 November 2022. The well will be deepened at about 3000m, and the drilling operations will last approximately 60 days.
• In August 2022, Maha Energy announced the signing of its agreement with Gulf Drilling Company for drilling a minimum of six wells in Block 70 onshore Oman. Oman's Ministry of Energy and Minerals awarded Maha Energy the exploration and development rights for the concession Block 70 in October 2020.