Market Trends of Oman Oil and Gas Upstream Industry
This section covers the major market trends shaping the Oman Oil & Gas Upstream Market according to our research experts:
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.
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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.
