Shell Integrated Gas Oman BV, a subsidiary of Royal Dutch Shell plc, along with its partners, OQ and Marsa Liquefied Natural Gas LLC (a joint venture between TotalEnergies and OQ), has signed a concession agreement with the Ministry of Energy and Minerals on behalf of the government of the Sultanate of Oman to develop and produce natural gas from Block 10. The parties also signed a separate gas sales agreement for gas produced from the block. The two agreements follow an interim upstream agreement signed in February 2019.
Shell’s entry into this block signifies a further commitment to Oman while enhancing and diversifying Shell’s gas supply.
The concession agreement establishes Shell as the operator of block 10, holding a 53.45% working interest, with OQ and Marsa Liquefied Natural Gas LLC holding 13.36% and 33.19% respectively. For the initial phase, Petroleum Development Oman (PDO) is building the infrastructure for the project, including the main pipeline to the Saih Rawl gas processing facility, on behalf of the Block 10 venture partners. The venture will drill and hook up wells to maintain the production beyond the initial phase. The block is expected to reach production of 0.5 billion standard cubic feet of gas per day (bscf/d). Startup is expected within the next two years.
In addition, Shell and Energy Development Oman (EDO) signed an agreement to process the natural gas from Block 10 in EDO’s Saih Rawl facility.