Monday, The Government of Oman announced that it has signed a concession agreement on April 12 with independent energy company, Harvest Natural Resources Inc. (HNR). The Exploration and Production Sharing Agreement, or EPSA, is for the exploration of gas in Block 64, an area straddling the boundaries of the Dakhiliya and Wusta regions.
Harvest Natural said that it aims to invest around $30 million in exploration activities during the initial three-year exploration phase. Of this amount, around $4.8 million would be earmarked during 2009 towards geology and geophysics, seismic reprocessing and drilling preparation costs.
Additionally, Harvest, which would have a 100% interest during the exploration phase, has signed a joint operating agreement with the wholly Omani government owned energy investment firm Oman Oil Company.
Block 64, also called the Al Ghubar/Qarn Alam licence, is a newly created concession carved out from the Block 6 concession operated by Petroleum Development Oman.
Ali bin Thabit al Battashi, Adviser to the Minister for Strategic Planning and Investments, said, "The parties to the agreement 'broke new ground' in their collective quest to conclude a successful deal."
Omani government noted that this agreement is seen as a shot-in-the-arm for the Ministry's continuing efforts to augment natural gas availability to help meet the nation's rapidly expanding energy needs.
HNR closed Thursday's trading session at $3.74.
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