Speaking at a handover ceremony at Al Bustan Palace, a Ritz-Carlton Hotel on Thursday, Bjorn Dale, managing director of DNO said effective January 4, Block 8 will be operated by Musandam Oil and Gas Company, a fully-owned subsidiary of Oman Oil Company Exploration and Production (OOCEP). The handover follows the expiry of the 30-year commercial term of the exploration and production sharing agreement between Oman's government and DNO.
The handover ceremony was held under the auspices of H E Salim bin Nasser al Aufi, undersecretary of the Ministry of Oil and Gas in the presence of representatives from DNO, Ministry of Oil and Gas, OOCEP and license partner LG International.
DNO held a 50 per cent interest in the Block 8 license alongside LG International, which held the remaining 50 per cent interest.
Dale said DNO has a long history of operations in Oman. The block was granted to the company around 34 years ago, and the commercial production started in early 1994.
“Since inception, Block 8 has produced 35mn barrels of oil and 285bn cubic feet of gas, generating the sultanate about the US$1bn in total revenues," he said while speaking about the importance of Block 8.
The offshore Block 8, which contains the Bukha and West Bukha fields off the Musandam peninsula, produced an average of 4,458 barrels of oil equivalent per day during 2018.
With the handing over of Block 8, DNO is completely exiting Oman’s upstream exploration and production segment.
On the possibility of re-entering Oman’s hydrocarbon sector, Dale said they are open to it and if there is an opportunity available to them in the future, the company would consider it.
DNO is mainly focused on the Middle East and the North Sea. Besides Oman, the company also has significant operations in other Gulf countries. It is one of the largest producers of oil in Iraq’s Kurdistan region and also holds licenses in Saudi Arabia and Yemen.