April 2001 Vol. 222 No. 4  International

Kurt S. Abraham,  Managing/International Editor

Oman yields two more significant finds

Exploration efforts continue to generate good results in the Sultanate of Oman. The country’s Ministry of Oil and Gas has announced two more discoveries – one gas and one oil – in the last couple of months. Both wildcats were drilled by dominant operator Petroleum Development Oman (PDO) in disparate parts of the country.

The most recent find, Kauther 1, is a major natural gas field that was struck last month. It is about 50 km (31 mi) south of the town of Adam in the Al Dakhiliyah region of northern Oman. Kauther 1 was drilled as part of an enhanced gas exploration program that PDO has been carrying out on behalf of the ministry. The goal is to quantify the Sultanate’s gas resources.

PDO said that a thick, gas-bearing sandstone was found at a depth of about 4,200 m (13,780 ft). Kauther 1 was drilled with Essar’s Rig 85 and is being completed for production testing. Final results are expected by June. PDO said Kauther might be the largest Omani gas field discovered during the last six years. Accordingly, further seismic surveys will conducted over surrounding acreage.

PDO said it was too early to determine field capacity, but Kauther should increase gas reserves by "a substantial amount." Oman’s proved gas reserves are 22 Tcf, with potential reserves more than double that amount. Omani gas demand was 28 MMcmd (990 MMcfd) in 2000 and is expected to reach 70 MMcmd (2.5 Bcfd) in 2005.

The other recent find was announced in late February. PDO said Zalzala 1 struck oil in southern Oman, about 80 km (50 mi) southwest of Marmul oil field and 60 km (37 mi) northeast of the town of Thumrait. The well found a 50-m (164-ft) thick, oil-bearing carbonate structure within a salt formation at a 5,300-m (17,338-ft) depth.

Zalzala 1’s production was due to be tested in the "near future." A second borehole will be drilled out of the original well, to determine the oil field’s extent more precisely. Prior to completion, Zalzala 1 had set a new Omani record for the longest openhole section at 4,050 m (13,287 ft).

Zalzala field is the fifth deep oil find struck in southern Oman during the last several years. PDO credits finding of these fields in large part to the acquisition and high fidelity processing of large amounts of seismic data. The firm has formed a "special team" to expedite oil production from this field cluster. Several new exploration wells are also planned for the area, aimed at adding still more oil to PDO’s reserves. Omani oil production currently stands at about 900,000 bpd, of which about 90% is pumped by PDO.

Oman’s latest discoveries should stimulate a flurry of additional field development work.

Eni strengthens its presence in FSU. Italy’s Eni has made moves in recent months to significantly enhance its positions in Kazakhstan and Russia. Regarding Kazakhstan, Eni in February won the right to operate the newly discovered, giant Kashagan oil field, offshore in the Caspian Sea. Kashagan is touted as one of the largest oil finds discovered worldwide in the last 40 years. For more on this operatorship, please see our interview with Eni Chairman Vittorio Mincato on page E-35.

Meanwhile, Eni is poised to become the first foreign operator to produce oil in Russia under its own name, rather than within a joint venture. The firm at press time was in negotiations with Gazprom to produce oil and gas from Russian onshore fields in the Caspian region. Combined reserves of these fields may be as high as 1 billion bbl of oil. The two firms expected to sign an accord by sometime next month.

Sasol and Qatar in JV. A joint venture agreement for an $800-million gas-to-liquids project has been signed by Qatar Petroleum and South Africa’s Sasol. The project will convert 330 MMcfgd from Qatar’s North field into 24,000 bpd of fuel, 9,000 bpd of naphtha and 1,000 bpd of LPG, beginning in 2005. The two firms have approved $30 million for front-end engineering and design activities. Work will begin as soon as regulatory approvals have been obtained. Qatar Petroleum will own 51% of the venture; Sasol will hold 49%.

Too "hot" to handle. Finally, for those readers that think former U.S. President Bill Clinton has a monopoly on shady dealings and decisions, we offer you this item from Paraguay. According to Reuters, police and court officials said that a gray BMW automobile driven by Paraguayan President Luis Gonzalez Macchi was brought illegally into that country and may also have been stolen. "According to preliminary information we have, that car’s characteristics correspond to a car stolen in a neighboring country," a police official told Reuters.

State prosecutor Alejandro Nissen said that the 1999 BMW 528i purchased by the president’s office was imported illegally. His findings also indicated it had been stolen abroad. Nissen did not comment on which country it may have come from. Paraguay is infamous for its black-market trade in stolen automobiles. According to police, more than 400,000 of the country’s 600,000 cars were bought on the black market, many of them stolen from Argentina, Brazil and Uruguay.