Sultanate to Increase Oil Production to 915,000 bpd
By staff - Sat Mar 31, 10:11 am
Muscat, March 30 (ONA) — Dr. Mohammed bin Hamad al-Rumhy, Oil and Gas Minister affirmed that the Sultanate can increase the average oil production to 915,000 bpd during this year, as approved in the 2012 budget.
In a statement to Oman News Agency (ONA), he said that production will increase starting from April 2012, with the operation of Harweel project which is expected to add 30,000 bpd alongside with some wells in Qarn Alam.
The Oil and Gas Minister added that there are new companies that will contribute to the Sultanate’s oil production during the coming period, such as OC Energy Company and those other operating companies, such as BP and Occidental Mukhaizna. He pointed out that currently there are seven companies that contribute to the Sultanate’s oil production.
He affirmed that the Sultanate attaches great interest in developing the oil and gas exploration and excavation programs, building the oil and gas stations and implementing non-traditional oil projects. He added that allocations have been made for these projects in the current 8th five-year plan (2011-2015).
He pointed out that new oil development for the Sultanate’s gas production is underway by BP in Khazzan and Makarem, which will produce 1 billion cubic feet of gas at the beginning alongside with some oil condensates. This will increase the Sultanate’s oil production. He also pointed out that the Sultanate’s gas production is currently stands at more than 95 million cubic meters and that estimates forecast the production to hit 100 million cubic meter by the end of this year.
‘ The Oil and Gas Ministry is currently implementing a number of new projects, such as electricity and the gas pipeline to A’Duqum Economic Zone , being implemented by Oman Gas Company , he added.
In response to a question on the current oil prices, he added that 25% of the current oil prices are attributed to technical reasons and not to supply and demand forces. Therefore, if the conditions remain as they are, the average oil price for the current year may easily range between $120 to $125.
As for the ideal price that achieves surplus at the state budget, Dr. Mohammed bin Hamad al Rumhy added that oil revenues in 2012 State Budget are calculated at $75 therefore having $90 bp will cover the deficit. If the price is more than this by the end of the year, there will be surplus at the budget.