Lebanese upstream oil and gas firm PetroLeb SAL yesterday signed an Exploration and Production Sharing Agreement (EPSA) with the Omani government covering Block 57 — also known as the Al Afif concession — in the southwest of the Sultanate. Dr Mohammed bin Hamed al Rumhy, Minister of Oil & Gas, signed the agreement on behalf of the government. PetroLeb SAL was represented by its CEO, Salah El Khayat. Also present were top officials from the Ministry of Oil & Gas, and senior executives representing the Beirut-based upstream firm.
The pact, granting exploration and development rights to PetroLeb, is the latest in a series of agreements concluded by the Ministry with an array of international and local firms in recent months. Four blocks were awarded last November alone, while another four concessions were offered for investment under the 2017 Licensing Round.
In remarks to journalists, PetroLeb’s chief executive officer Salah El Khayat said the pact effectively marked the Lebanese firm’s maiden foray into the Sultanate’s upstream energy sector. The company plans to invest around $24 million over the initial 3-year period of its commitments under the EPSA pact. This will include costs towards extensive 3D seismic gathering and the drilling of a deep well. Several additional wells are planned in the second phase, he said.
Little is known by way of the hydrocarbon potential of the 2,262 sq km Al Afif concession, said El Khayat. “There is some data we have bought from the Ministry, but we have to do seismic and drill a well to be able to know its potential. We believe it is prospective because there are producing oilfields around it, which is very encouraging.”
A number of factors are behind PetroLeb’s decision to make inroads into the Sultanate’s oil and gas industry, said the CEO. “Firstly, the history of International Oil Companies (IOCs) working in Oman has been encouraging; they have been happy to deal with the Ministry of Oil & Gas. Secondly, there are prospects in Oman that we believe in; by coming and investing here, we hope to participate in finding a commercial discovery here; and Thirdly, we believe in the stability of Oman and its wise leadership.” While the company will seek to focus on its newest acquisition, it will not ignore opportunities for further investment in the Sultanate, the CEO added.
Previously part of Petroleum Development Oman’s (PDO) acreage, Block 57 is located on a regional high between two world-class oil provinces — the South Oman Salt Basin and the Rub Al Khali Basin.
Beirut-headquartered PetroLeb is among a number of international companies eyeing opportunities to explore for hydrocarbons in deepwater areas located off Lebanon.