Published On: Mon, Feb 1st, 2021

BP to sell 20% stake in Oman’s Block 61 to PTTEP for $2.6bn

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Oil and giant BP has signed a deal worth $2.6 billion to divest a 20% participating stake in the producing in Oman to Thailand-based PTT Exploration and ‎‎Production Public Company (PTTEP).

‎Upon closing of ‎the deal, BP will continue as operator of the block with a 40% stake. The other partners in Block 61 are Omani national oil company OQ (30%), and ‎PETRONAS (10%).‎

The total consideration comprises $2.45 billion, which will be paid at the time of closing the deal and a contingent payment of $140 million on pre-agreed future conditions.‎

Block 61, which spans nearly 3,950km2 in central Oman, hosts what is the largest tight gas ‎development in the Middle East.

The onshore Omani block already has two phases of development in the form of the ‎Khazzan field which entered into production in 2017, followed by the Ghazeer field, which began production last October.

The Khazzan and Ghazeer developments are targeting to develop a total of 10.5 trillion cubic feet of gas ‎resources. They have a combined daily production capacity of 1.5 billion cubic feet of gas and over 65,000 barrels of condensate.

Bernard Looney – BP CEO 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.

“We are committed to bp’s business in Oman – this agreement allows us to remain at the ‎heart of this world-class development while also making important progress in our global ‎divestment programme.”‎

BP to sell 20% stake in Oman’s Block 61 to PTTEP for $2.6bn

BP to sell 20% stake in Oman’s Block 61 to PTTEP for $2.6bn. Photo courtesy of PTT Exploration and Production Plc.

For PTTEP, the stake in Block 61 will add to its petroleum reserves and sales volumes, promote its long term growth, and pave way for more investment opportunities in the Middle East.

Phongsthorn Thavisin – CEO of PTTEP said: “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.”

The deal, which is subject to approval from the Omani government and the partners in the block, is expected to close during the course of this year.

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