“This initiative by BP is in line with the Oman government’s policy of encouraging companies not to flare gas, but to convert it into a usable asset. BP has been very positive in responding to the government’s call in this regard by investing more than $200 million in realising this project, Ali bin Thabit al Battashi, Adviser to the Minister for Strategic Planning and Investments, said.
Al Battashi said the $200 million investment by BP will generate a lot of benefits to the Sultanate, as well as contribute to the nation’s gas requirements at a critical time. He also voiced belief that BP would begin delivering a minimum of one billion standard cubic feet of gas per day from its Khazzan and Markarem fields by 2015.
Speaking to the Observer, Michael Townshend, BP Oman’s President said the project has significant economic and environmental benefits. When appraising any gas, you need to test it to see what the flow rate is. And normally it’s just flared. This agreement is one of a number of steps to allow that gas — instead of being flared — to go through a gas processing plant and be used by Oman. This is also good for the environment.
The appraisal long-term test gas will begin flowing from the Khazzan-Makarem fields from the latter half of 2010, said Townshend. There is considerable investment already done in drilling wells and in building the infrastructure to move this test gas, and after that we will see how successful it is. Later on, we will have to see whether we can make a full field development decision.
The agreement represents a step forward in efforts by BP to appraise and develop the gas reserves contained within block 61, a 2,800 square kilometers area that comprises the Khazzan and Makarem gas fields.
