Omani Energy Minister Salem Al-Awfi said that oil prices are difficult to determine accurately. Even the expectations of international financial institutions differ from month to month.
Today, Monday, February 6, 2023, Al-Awfi said that the production of oil and condensate exceeds 1.1 million barrels per day, with the possibility of increasing production quickly without delay, according to his statements to the official radio of the Sultanate of Oman.
The Omani Minister of Energy stressed that oil prices in the Sultanate of Oman have been stable at $80 since the beginning of this year, indicating that there are attempts to focus on the gas sector, according to statements seen by the specialized energy platform.
Will oil prices rise?
The Omani Minister of Energy commented on the expectations of JP Morgan Bank at the beginning of the Russian war that oil prices might reach $180, saying that setting prices is difficult, explaining that the expectations of international institutions differ every month between high and low, according to geopolitical conditions.
And he added, “However, in the Sultanate of Oman, we do not rely strongly on oil price expectations, but rather depend more on sustainable production,” pointing out that the annual production cost ranges between 20 and 25 dollars per barrel, and the operating cost is in the range of 7 to 9 dollars.
The Omani Minister of Energy stated that all the activities of foreign or local companies in the Sultanate of Oman did not stop. As the state continues to support oil and gas exploration, and to explore more opportunities to increase production.
The minister confirmed that it is difficult to predict figures related to average oil prices for the year 2023, but he expressed hope that they will not fall below $75, according to statements monitored by the specialized energy platform.
He continued, “During the next 3 years and the indicators that we have seen, I expect it to be between 60 and 70 dollars, which is convenient for producers and consumers. Our problem is not with the price falling or rising, but the fluctuations that make us not take decisions related to projects.”
exploration in the Sultanate of Oman
Omani Energy Minister Salem Al-Awfi said that exploration operations are continuing in the oil and gas sectors, explaining that his country believes that exploration is the only source of continuity of production, according to statements seen by the specialized energy platform.
And he continued, “Our policy is to offer new concession areas, as long as they are available, and in this quarter we will offer 3 or 4 areas, so that investors – whether foreign or local – enter into the bidding and present the technical programs that will be implemented, and participate with the government in terms of profit sharing.”
Al-Awfi indicated that his country does not have large oil projects at the present time, but it is working to develop the gas sector. Where square 11 entered into exploration, and in the event that any commercial exploration is approved; Development work will begin immediately.
The country’s reserves of oil and gas
On the oil reserves in the Sultanate of Oman, Energy Minister Salem Al-Awfi said that this matter depends on production, but for oil there are 4.8 billion barrels, and the state is working to add new reserves to cover annual production.
As for the gas reserves in the Sultanate of Oman, the Minister of Energy and Minerals said that there are 23 trillion cubic feet of reserves in the country, in addition to efforts and attempts by the state to increase reliance on renewable energy sources.
Al-Awfi pointed out that the current LNG contracts were signed in 1995 and are expected to expire in 2024. Therefore, the Sultanate of Oman needs new contracts, otherwise the liquefied gas export terminal in Sur will stop. Therefore, the country is working to open new markets.
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