Shell Integrated Gas Oman and its partners OQ and Marsa Liquefied Natural Gas LLC have signed a concession agreement with the Ministry of Energy and Minerals on behalf of the government of Oman to develop and produce natural gas from Block 10 of the Saih Rawl gas field
Additionally, the parties signed a separate gas sales agreement for gas produced from the block. The two agreements follow an interim upstream agreement signed in February 2019.
“These agreements represent a major step for Shell and for our relationship with Oman. They generate value and strengthen our Integrated Gas business, which we need to deliver the energy Oman and the world need today. And we are looking at how Shell can help Oman with developing low-carbon energy in the future,” said Wael Sawan, Shell Integrated Gas, renewables and energy solutions director.
The concession agreement establishes Shell as the operator of Block 10, holding a 53.45% working interest, with OQ and Marsa Liquefied Natural Gas 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 bscf per day. Start up 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.
Also, in parallel to the development of Block 10, Shell will develop options for a separate downstream gas project in which Shell could produce and sell low-carbon products and support the development of hydrogen in Oman.