Apparently, this large offshore exploration area spans 21,000 sq km, is located in Northeast Oman, and provides quite a prominent exploration potential throughout the diverse geological settings, right from shallow to ultra-deep water, confirmed PETRONAS in a statement.

The concession agreement with Oman government involves the wholly owned unit of PETRONAS, PC Oman Ventures Ltd, and is built on the memorandum of understanding – MOU of the national oil company with OQEP in October.

According to PETRONAS, it marks a significant landmark when it comes to strengthening the strategic partnership between both companies and also reinforcing the long-term presence of PETRONAS in the Sultanate of Oman.

The statement by the company further added that the partnership supports the aspiration of PETRONAS to upgrade its competitive upstream portfolio through aligning its offshore exploration capacity with the regional expertise of OQEP, thereby laying the base for a venture that’s mutually beneficial.

It is well to be noted that Block 18 is one of the largest offshore concession blocks located in Oman and apparently was part of the concession blocks launched in 2024 by the state, which was a new approach to investment across the O&G sector and included the execution of a contractual system that is based on concession fees, in addition to allowance for the integrated gas exploitation projects.

PETRONAS vice president of international assets Mohd Redhani Abdul Rahman said, “Building on our technical strengths and successes, PETRONAS continues to expand its exploration activities into new frontiers.”

He further added, “Through our innovative exploration approaches and OQEP’s basin expertise, we aim to jointly unlock the potential of Block 18, contributing to Oman’s long-term energy security.”

According to him, “The addition of Block 18 aligns with our commitment to disciplined portfolio expansion, providing strategic optionality across our international portfolio.”

Interestingly, this latest announcement goes on to add to a series of major discoveries that have been achieved by PETRONAS last year, including the unlocking of hydrocarbon potential in Lebah Emas of Malaysia and the delivery of discoveries in Suriname Block 52.

The statement rolled out by PETRONAS says that being a global energy and solutions partner, PETRONAS stands committed to looking out for global opportunities and at the same time seeks to deepen its collaboration with its strategic partners.

The $273 million EPC contract, which was announced on December 29, 2025, during a meeting between Karim Badawi, the Egyptian Minister of Petroleum and Mineral Resources, and the Managing Director of

OQ Gas Networks – OQGN, Mansoor Ali Al-Abdali, underscores the ever-increasing energy infrastructure cooperation between both the nations.

Apart from the gas pipeline, PETROJET is also going to execute the first phase of the planned hydrogen pipeline network by OQGN by way of undertaking 400 kilometers of the overall 2,000-kilometer project at an expected cost of $250 million.

The Egyptian firm is also going ahead and preparing to compete for the upcoming green hydrogen and Natural Gas Liquids Extraction – NGLE projects, making utmost use of its global expertise. The announcement was made at the Green Hydrogen Summit in Oman, where the leaders went on to discuss collaborative opportunities.

Separately, both Minister Badawi as well as Mohsen Al-Hadhrami, the Undersecretary of the Ministry of Energy and Minerals and also the Chairman of Petroleum Development Oman – PDO went on to review the involvement of PETROJET when it comes to civil works as well as housing as per a new framework agreement, in addition to the five other firms.

Apparently, other Egyptian firms, Engineering for the Petroleum and Process Industries – ENPPI and also Egypt Gas, are going forward with the registration on the Tawreed platform of OQGN.  Both the companies are finalizing their technical pre-qualification documents when it comes to gas pressure reduction stations located at the Duqm Refinery, targeting a completion before the end of 2025.

ENPPI, the present partner with OQGN, Oman Tank Terminal Company – OTTCO as well as Duqm Refinery, is listed as a strong contender for all the forthcoming project tenders.

More discussions have taken place, such as meetings with OQ Alternative Energy and Hydrogen Oman Company focused upon expanding the footprint of the Egyptian company in oil, natural gas, and green hydrogen, as well as ammonia projects, especially in the major regions of Salalah and Duqm.

The suite of agreements indeed makes the deepening relationship between the Egyptian and Omani energy sectors more robust, with PETROJET, ENPPI as well as other Egyptian firms all set to have pivotal roles in the emerging energy as well as industrial development initiatives of Oman.

Oil ministers across the V8 grouping, which comprises countries like Russia, Saudi Arabia, Iraq, the United Arab Emirates, Kazakhstan, Kuwait, Algeria, and Oman, have decided to increase their production by 137,000 barrels a day (bpd) from October 2025, they remarked in a statement.

It is well to be noted that these countries had already gone on to increase the production by 2.2 million bpd in recent months.

In the statement which was issued after an online meeting that took place on September 07, 2025, these nations said that the new incoming cycle could as well witness an extra 1.65 million bpd, which would eventually come to the market.

According to one of the analysts at Rystad Energy, Jorge Leon, OPEC+ has already caught the market off guard rather than pausing, and the group has pretty evidently signalled ambition with a production surge. Although the barrels may be small, however, the fact is that the message is big.

With OPEC+ to boost oil output in October it is indeed prioritizing market share even if it has to face the risks pertaining to softer prices. Oil prices at present are hovering around $65-70 for every barrel. They have witnessed a dip of 12% in 2025 already as global producers outside of the OPEC+ ramp up their supply and the tariffs go on to curb demand.

It is well to be noted that OPEC+, which happens to comprise the 12-nation Organization of the Petroleum Exporting Countries (OPEC) and its allies, in recent years had gone through many output deductions that have amounted to almost six million bpd.

Analysts, only till a week ago, were saying the V8 was most likely to maintain their present output levels in October 2025. However, by raising the output, even by a comparatively modest 137,000 bpd, the V8 has rather indicated that with OPEC+ to boost oil output in October, they would be willing to weather the prices falling down below $60 a barrel if it means regaining the market share.

According to Leon, in reality, the actual production output is going to be far smaller, given the capacity limits as well as the compensation mechanism that is present. However, it is the perception that often matters and not the physical barrels.

However, he still said that the move raises certain questions pertaining to unity, as countries like Russia happen to depend on high prices so as to fund their war machine, while there are others who are willing to test the lower prices when it comes to the market share.

Geopolitical Perspectives

The real test of OPEC+ is going to be the last three months of 2025, a period in which the seasonal demand tends to be much lower.

Oil specialists happen to be keeping a close eye on the war in Ukraine along with other developments pertaining to US-Russia relations – these are some of the geopolitical factors that could affect the oil prices to a great extent.

Donald Trump, the US president, whose efforts to mediate between Russia and Ukraine have failed to produce the breakthrough he was hoping for, has recently targeted Russian oil and those who are buying it.

In August 2025, Trump imposed higher tariffs on India as a kind of punishment for its Russian oil purchases.

In a meeting which took place with the allies of Ukraine who had gathered in Paris recently, Trump had told the leaders through a video conference that he was pretty much frustrated with the Russian oil purchases by the EU, especially by Hungary and Slovakia.

The fact is that curbing the Russian exports could also free up the market space for the countries in OPEC+.

The Khazzan gas field is located in the South of Block 61 at the Ad Dhahirah Governorate of Oman.

The field is estimated to contain proven reserves of about 100trillion cubic feet of natural gas and condensates as of 2012.

Khazzan gas field development details

BP Oman signed an agreement with the Government of Oman to develop the Block 61 and the Khazzan and Makarem gas fields in January 2007. The agreement covers about 2,800km2 in central Oman, which is rich in tight gas reservoirs that were first discovered in 1990s.

“The field development plan includes a 15-year drilling programme involving 300 wells in total.”

The field development plan includes a 15-year drilling programme involving 300 wells in total. Most of the wells will be drilled horizontally by using eight drilling rigs, due to the tight nature of the rocks in Khazzan reservoirs.

The drilling activities were commenced in September 2008. BP drilled 11 wells, including three horizontal wells, so far. The first gas from Block 61 test well was achieved and delivered to the Oman’s Saih Rawl gas plant in March 2011.

The first development well drilled at the field was the KZN-14, which was drilled by Dalma-5 rig in September 2013. It is the first of several hundred development wells to be spudded in the block.

The project will also include construction of a new central processing facility with a designed processing capacity of 1,050 cubic feet of gas, 100km of export pipelines, 600km of flowlines, and other gathering systems.

The produced gas will be transferred to the processing facility in Block 61 via a 500km long gathering system. Construction of the gas gathering pipeline network is expected to start by early 2014.

Contractors involved with BP’s Khazzan gas field development

The Ministry of Oil and Gas (MOG) of Oman signed a gas sales and an amended production sharing agreement with BP for the development of the Khazzan field in December 2013. The agreements will be valid for the next 30 years and will also provide for additional appraisals for future discoveries within Block 61.

BP contracted Dalma Energy to supply two drilling rigs for the Khazzan field development.