The oil giant British Petroleum agreed to sell 20% of its stake in Oman’s gas Block 61 for $2.6 billion.
BP said it had sold its stake to Thailand’s PTT Exploration and Production Public Company Ltd. (PTTEP). The company will still operate Block 61 with a 40% stake.
BP said the agreement represents another critical step in its major divestment plans. The completion of the deal is subject to the approval of the Sultanate of Oman and other partners.
The company expects the deal to be completed in 2021.
BP explained that Block 61 can meet about 35% of the gas demand in the Sultanate of Oman.
The largest project
According to the BP statement, Block 61 is BP’s largest asset in Oman. It contains the largest sealed gas development project in the Middle East.
The block has already had two phases of development – Khazzan, which began production in 2017, and Ghazeer in Oct. 2020.
The two developments, targeted at developing a total of 10.5 trillion cubic feet of gas resources, have a combined daily production capacity of 1.5 billion cubic feet of gas and more than 65,000 barrels of condensate.
Thai PTTEP already has investments in Oman and is expanding its presence in the region. The company has obtained a license to explore for oil and gas off the coast of Abu Dhabi in December.
The British company
BP is the third-largest private oil company after ExxonMobil and Shell. It used to be the British government’s oil arm for several years before it was privatized in 1976.
The company has oil reserves of 18.3 billion barrels and a distribution network consisting of 28,500 fuel stations and 19 refineries.
The company also owns oil fields in the North Sea, Alaska, Russia, Algeria and Angola. BP’s shares are included in the British FTSE 100 Index in London Stock Exchange.
In 1937, the Iraq Petroleum Company (IPC), owned by 23.75% by British Petroleum, signed an oil concession agreement with Muscat’s Sultan.
In 1952, the Iraq Petroleum Company provided financial support to form an armed force that would assist the Sultan in occupying Oman’s interior region.
Geologists believe the area is rich in oil. This led to the outbreak of the Jebel Akhdar War in 1954 in Oman, which continued for more than five years.