NOC Survey 2008: Petroleum Development Oman

04 July 2008
Oman must secure fresh resources while halting declines in output at ageing fields.

If there is one regional NOC that best encapsulates the challenges facing the hydrocarbons sector, it is Petroleum Development Oman (PDO), the majority state-owned firm responsible for more than 80 per cent of the sultanate’s oil output. Its oil fields are clearly reaching their peaks and even with the introduction of one of the world’s most advanced EOR programmes, it is unlikely that production will ever return to past highs.

CompanyPetroleum Development Oman
Oil Reserves5.6 billion barrels
Oil Production2007718,000 barrels a day*
Gas Reserves24.4 trillion cubic feet
Gas Production 200724.1 billion cubic metres
*includes NGLs. Source: BP Statistical Review 2008

In light of this, PDO is introducing a range of increasingly advanced EOR technologies to the sultanate - from thermally assisted gas/oil gravity drainage and steam injection to polymer flooding, alkaline/surfactant/polymer flooding and microbial EOR.

Falling output is not its only challenge. The volume of water infiltrating reservoirs is rising fast and water cut rates are expected to inc-rease by 35 per cent over the next 10 years. The energy-intensive EOR schemes will require a 170 per cent increase in power over the same period.

Unsurprisingly perhaps, the consensus among respondents to MEED’s NOC survey is that finding more natural resources is the company’s greatest priority.

To its credit, PDO does not shy away from these issues, finding innovative and creative ways to deal with the challenges. One example is the region’s first private sector concession to offtake effluent water from wellheads and treat it in reed beds before selling it for crop irrigation or biofuel production.

The firm is also looking at being the region’s first NOC to import coal to use as fuel for power generation. Muscat has also detached some concessions from PDO’s mandate and transferred them to IOCs, which it hopes will bring in some additional cash and expertise.

PDO’s main task will be to engage its own exploration programme while ensuring that production does not decline further. To its credit, the firm has a good staff training programme, with one of the highest local national employment rates of any NOC, critical for a country that desperately needs jobs.

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