Sitting at the centre of the world's richest oil region, Amman has the bad luck to have no significant resources of its own, needing to buy in all its fuel. The challenge for the kingdom has been to persuade international oil companies (IOCs) to invest in what hydrocarbons reserves it has. In September, the hard work appeared to have paid off with the signing of a production sharing agreement (PSA) - the first since 1997 - with the US' Sonoran Energy. Sonoran believes the kingdom's oil reserves could be greater than previously realised. Preliminary technical studies in the Hamza field in the eastern corner of the Azraq block, in the centre of the country, revealed that it may contain up to 30 million barrels of crude oil.
While the rest of the region has proven reserves of 734,000 million barrels of oil, about 62 per cent of the world's total oil reserves, Jordan has a meagre 1 million barrels. However, oil shale is one hydrocarbons resource the country has in abundance. There are 18 known surface and near-surface deposits in the kingdom, which, according to the National Energy Research Centre (NERC), have exploitable reserves of up to 40,000 million tonnes of shale oil. In the 1980s, several studies were carried out to assess the viability of the country's oil and oil shale blocks. The results were mixed - and certainly not persuasive enough to convince most IOCs to make significant investments. But things could be about to change. Sonoran's new agreement, signed with the Natural Resources Authority (NRA), covers the 11,250-square-kilometre Azraq block. According to the terms of the PSA, Sonoran will explore and develop the block with plans to invest $13 million in two phases over the next six years. Under an initial four-year exploration phase, Sonoran plans to carry out 3D seismic surveys over about 300 square kilometres and drill a minimum of two exploration wells. A second two-year phase comprises a number of technical studies. Potential finds 'Using new technology and new types of seismic to remap old NRA data, potential finds could be in the range of at least 10 million-20 million barrels,' says executive vice-president of Middle East operations Ala Nuseibeh. 'Our intention is to increase the Hamza field to 30 million-40 million barrels of crude oil. Any finds would be significant for Jordan.' Sonoran is not alone. Jordan has nine oil and gas blocks (see map). The local/US Trans Global Petroleum Jordan holds a concession for the Wadi Araba area in the west near the Dead Sea. Another concession is held by National Petroleum Company, an NRA spin-off, in the northeast corner of the country. Recently, the NRA inked four more potential PSAs for the exploration and development of oil blocks in the country. Memorandums of understanding (MoUs) for four other blocks were signed in early August with two Indian companies. Monnet Ispat will develop the North and South Sirhan blocks, comprising a total area of 11,610 square kilometres, and Chataranan Industrial will develop the 8,850-square-kilometre West Safawi block. According to NRA officials, a UK company is also considering signing an MoU for the 7,500-square-kilometre North Highlands block. They also expect to conclude soon a PSA with Dublin-based Petrel Resourcesfor the 8,750-square-kilometre East Safawi block in the northeast. The deal follows Petrel's signing of an MoU in January. The estimated $10 million-12 million deal is expected to last six years. Such interest is not a new phenomenon. Several IOCs have expressed interest in the past, including companies from the US, Croatia and Russia, and Australia's NFG Development, which signed an MoU in October 2003 covering the Sirhan blocks. For others - including Russia's Tatneft with Canada's Dauntless Petroleum and the UK's Star Petroleum - the exploration process did not yield sufficient results.