Norwegian firm quits Oman offshore oil block operations

06 January 2019
Operator hands over its stake in offshore block to local state-owned firm

Norwegian oil and gas operator DNO has said its subsidiary in Oman has relinquished operatorship and participation in the sultanate’s Block 8 to state-owned Oman Oil Company Exploration & Production (OOCEP).

MEED previously reported that DNO was preparing to quit its licence in the offshore block, and hand it over to OOCEP.

Block 8 is located off the Musandam peninsula, and contains the Bukha and West Bukha fields. It produced an average of 4,458 barrels of oil equivalent a day in 2018.

DNO has formally handed over the block to OOCEP-owned Musandam Oil & Gas Company following the expiry of its 30-year exploration and production-sharing agreement with the Omani government.

"Since inception, Block 8 has produced 35 million barrels of oil and 285 billion cubic feet of gas, generating Oman about $1bn in total revenues," DNO's managing director Bjorn Dale has been quoted as saying at the handover event in Muscat.

Oslo Stock Exchange-listed DNO had a 50 per cent interest in the licence, alongside South Korea’s LG International, which holds the remaining 50 per cent stake.

The Norwegian company, whose largest shareholder is RAK Petroleum Holdings with a 40.45 per cent stake in the company, is one of the largest oil producers in Iraq’s Kurdistan region.

It also holds licences in Norway, the UK and Yemen.

DNO is engaged in a tightly contested takeover bid for UK-registered Faroe Petroleum, in which it owns a 30 per cent stake.

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