“Our respective teams are now finalising the relevant technical and financial agreements,” said chairman and chief executive officer Ray Irani. “Various Bahrain agencies and government authorities have already approved [Occidental] as the winning bidder for the project, and we hope to have the completed agreement approved by the Bahrain parliament before year-end.”
He was speaking following the publication of the company’s fourth quarter and full year results for 2008.
A source at Noga previously told MEED that a formal contract signing would take place in April following government approval (MEED 13:1:09).
Neither Occidental or Noga were available for comment on the reason for the delay.
Occidental submitted the lowest bid for the work ahead of Denmark’s Maersk Oil and the US’ ExxonMobil Corporation in December (MEED 22:12:08).
The company is already carrying out offshore exploration work on existing blocks in the southeast of Bahrain.
Oil majors have previously pledged to more than double the capacity of the onshore Awali field to 70,000 barrels a day (b/d), from 33,000 b/d currently, and boost gas production to 2 billion cubic feet a day (cf/d) from 500 million cf/d (MEED 9:11:07).
Noga is expected to form a joint venture company with Occidental to run and manage the operation of the field over an expected 20-year term.
Rising domestic demand has increased the urgency for fresh production in the country. The authority estimates that domestic demand for oil will increase by at least 3 per cent a year over the next few years, reaching 45,000 b/d by 2011, while there has been a gradual decline in local crude output to 33,000 b/d, from 70,000 b/d in the 1970s.