Government of Oman and BP on Monday signed a gas sales agreement and an amended production sharing agreement for the development of the Khazzan field, with BP as operator.

According to an official statement issued by BP in New Delhi, the full field development will involve a drilling programme of around 300 wells over 15 years to deliver plateau production of one billion cubic feet (28.3 million cubic metres) of gas per day and 25,000 barrels per day of gas condensate.

This volume is equivalent to around a third of Oman’s total daily domestic gas supply and will make a significant contribution to ensuring continuing stable supplies from domestic sources. The total investment in the full field development is around $16 billion, which includes the investment made to date in the appraisal of the resource and early well test programme.

The Khazzan project represents the first phase in the development of one of the Middle East region’s largest unconventional tight gas accumulations, which has the potential to be a major new source of gas supply for Oman over many decades, the statement added.

Construction work for the Khazzan project, located in the South of Block 61, will begin in 2014, and first gas is expected in late 2017. Gas production is expected to ramp up to plateau in 2018 and in total the project is expected to develop around 7 trillion cubic feet (tcf) of gas, which will require BP to successfully deploy new technologies.

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