Oman Denies Claims about Negotiations with Iran Over Stakes in Hengam Gas Field

Oman has achieved a balanced increase of 2.1 percent in the production of crude oil and oil condensate during 2021. (Oman News Agency)
Oman has achieved a balanced increase of 2.1 percent in the production of crude oil and oil condensate during 2021. (Oman News Agency)
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Oman Denies Claims about Negotiations with Iran Over Stakes in Hengam Gas Field

Oman has achieved a balanced increase of 2.1 percent in the production of crude oil and oil condensate during 2021. (Oman News Agency)
Oman has achieved a balanced increase of 2.1 percent in the production of crude oil and oil condensate during 2021. (Oman News Agency)

The Omani Ministry of Energy and Minerals stressed that it had not recently participated in any technical discussions or commercial negotiations related to the joint offshore oil field with Iran.

Oman denied recent reports by Iranian media about a bilateral agreement over the Hengam gas field, and Tehran’s acquisition of an 80 percent share. The ministry stated that previous discussions on the development of the field have failed to reach an agreement.

In a statement on Tuesday, the ministry of Energy noted that it had not recently participated in any technical discussions or commercial negotiations related to this joint field and denied any agreement to distribute shares between the parties.

It confirmed, however, that maximizing the benefit of the gas field would only be achieved through joint development.

“The joint offshore oil field (West Bukha - Hengam) is located between the maritime borders of the Sultanate of Oman and the Islamic Republic of Iran, off the Musandam Governorate from the Omani side. The part of the Iranian side is called Hengam and on the Omani side it is called West Bukha in concession area block 8. Production in the West Bukha field of the Sultanate of Oman has started since 1985,” the ministry clarified.

The joint field contains huge reserves of oil and gas, estimated at 700 million barrels of oil, in addition to two trillion cubic feet of gas.

Iranian media recently said that the Omani and Iranian sides reached an agreement on the division of shares, according to which Iran would get an estimated 80 percent of the field’s production, while the Sultanate of Oman would receive 20 percent.

Meanwhile, a senior official in the Omani Ministry of Energy and Minerals stated that the country has achieved a balanced increase of 2.1 percent in the production of crude oil and oil condensate during 2021, maintaining the same levels of oil production. This comes in line with an agreement to reduce production with OPEC and other countries outside the organization.

Dr. Saleh bin Ali Al-Anbouri, Director General of the ministry’s General Directorate of Exploration and Production, said: “The reserves of crude oil and oil condensates have increased by four percent compared to 2020.”

In a report published by the Oman News Agency, Al-Anbouri noted that the ministry has supervised the implementation of several projects with oil and gas operating companies, which aim to develop fields and ensure continuous improvement through latest technologies.

The average production of crude oil and oil condensates during the year 2021 was about 971,000 barrels per day, compared to 951,000 barrels per day in 2020, with an increase of 2.1 percent over the previous year.



OPEC Again Cuts 2024, 2025 Oil Demand Growth Forecasts

The OPEC logo. Reuters
The OPEC logo. Reuters
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OPEC Again Cuts 2024, 2025 Oil Demand Growth Forecasts

The OPEC logo. Reuters
The OPEC logo. Reuters

OPEC cut its forecast for global oil demand growth this year and next on Tuesday, highlighting weakness in China, India and other regions, marking the producer group's fourth consecutive downward revision in the 2024 outlook.

The weaker outlook highlights the challenge facing OPEC+, which comprises the Organization of the Petroleum Exporting Countries and allies such as Russia, which earlier this month postponed a plan to start raising output in December against a backdrop of falling prices.

In a monthly report on Tuesday, OPEC said world oil demand would rise by 1.82 million barrels per day in 2024, down from growth of 1.93 million bpd forecast last month. Until August, OPEC had kept the outlook unchanged since its first forecast in July 2023.

In the report, OPEC also cut its 2025 global demand growth estimate to 1.54 million bpd from 1.64 million bpd, Reuters.

China accounted for the bulk of the 2024 downgrade. OPEC trimmed its Chinese growth forecast to 450,000 bpd from 580,000 bpd and said diesel use in September fell year-on-year for a seventh consecutive month.

"Diesel has been under pressure from a slowdown in construction amid weak manufacturing activity, combined with the ongoing deployment of LNG-fuelled trucks," OPEC said with reference to China.

Oil pared gains after the report was issued, with Brent crude trading below $73 a barrel.

Forecasts on the strength of demand growth in 2024 vary widely, partly due to differences over demand from China and the pace of the world's switch to cleaner fuels.

OPEC is still at the top of industry estimates and has a long way to go to match the International Energy Agency's far lower view.

The IEA, which represents industrialised countries, sees demand growth of 860,000 bpd in 2024. The agency is scheduled to update its figures on Thursday.

- OUTPUT RISES

OPEC+ has implemented a series of output cuts since late 2022 to support prices, most of which are in place until the end of 2025.

The group was to start unwinding the most recent layer of cuts of 2.2 million bpd from December but said on Nov. 3 it will delay the plan for a month, as weak demand and rising supply outside the group maintain downward pressure on the market.

OPEC's output is also rising, the report showed, with Libyan production rebounding after being cut by unrest. OPEC+ pumped 40.34 million bpd in October, up 215,000 bpd from September. Iraq cut output to 4.07 million bpd, closer to its 4 million bpd quota.

As well as Iraq, OPEC has named Russia and Kazakhstan as among the OPEC+ countries which pumped above quotas.

Russia's output edged up in October by 9,000 bpd to about 9.01 million bpd, OPEC said, slightly above its quota.