PTT Exploration and Production Public Company Limited (PTTEP) of Thailand has announced that it has acquired a 20 per cent participating interest in Oman’s Block 61 from bp for a total consideration of $2.6 billion.
The deal is subject to approval from the Sultanate of Oman and partners, the deal is expected to complete during 2021. The agreed total consideration of $2.590 billion comprises $2.450 billion payable on completion (subject to final adjustments) and $140 million payable contingent on pre-agreed future conditions.
Block 61 is a producing onshore gas field with enormous resources and significant importance to Oman’s natural gas market. Block 61 has the capacity to deliver approximately 35 per cent of total gas output in Oman. Covering around 3,950 square kilometers in central Oman, Block 61 is comprised of two phases, Khazzan gas development which began production in 2017, followed by Ghazeer in October 2020 with a combined daily production capacity of approximately 1,500 million cubic feet per day (MMSCFD) for gas and more than 65,000 barrels per day (BPD) for condensate. The block is targeted at developing total gas resources of 10.5 trillion cubic feet (TCF).
In a statement, PTTEP said that the acquisition will immediately add to the company’s petroleum reserves and sales volumes, foster its long term growth, and open up further investment opportunities in the Middle East. The investment will also have an immediate effect of increasing PTTEP’s petroleum reserves and sales volumes. Furthermore, this will also open an opportunity for PTTEP to develop a high potential project in Oman in collaboration with world-class E&P companies.
“Since 2019, PTTEP has invested in key assets in Oman including PDO (Block 6), the largest onshore oil field in Oman, and Oman LNG, the only LNG gas liquefaction complex in the country. The investment in Block 61 is aligned with PTTEP’s direction of growth, focusing on highly prolific areas, and supports our strategy towards gas value chain investments as gas produced from the block will boost availability of gas supply for Oman LNG. This successful acquisition will further strengthen PTTEP’s foothold in Oman in the long run and pave the way for future investments in the Middle East,” said Phongsthorn.
bp chief executive officer Bernard Looney said: “We are pleased to welcome PTTEP to the successful Block 61 partnership. Block 61 is a pioneering development that has applied leading techniques and technologies to maximise efficiency and minimise emissions."