Muscat: The Ministry of Energy and Minerals, representing the Government of the Sultanate of Oman, has finalized a concession agreement for Offshore Block (18), aiming to bolster exploration and production efforts and expand the hydrocarbon resource base within the country.
According to Oman News Agency, the agreement was formalized by Eng. Salim Nasser Al Aufi, Minister of Energy and Minerals, on behalf of the Omani government. Mahmoud Abdullah Al Hashmi, Acting CEO of OQ Exploration and Production, signed for OQ Exploration and Production. Meanwhile, Muhammad Redhani Abdul Rahman, Vice President of International Assets at PETRONAS, signed for PC Oman Ventures Limited, a subsidiary of Malaysia's PETRONAS, which will operate the concession area.
Under the agreement's terms, PETRONAS will hold a 70% participating interest and assume operatorship, while OQ Exploration and Production will retain a 30% stake. The agreement outlines an initial exploration phase of four years, with the potential for extension and the possibility of declaring commerciality, leading to a production concession of up to thirty years.
Offshore Block (18), spanning over 21,000 square kilometers in the Sea of Oman, is recognized for its geological potential despite the technical challenges of deepwater exploration and drilling, as no confirmed discoveries have been made previously in the area.
Eng. Al Aufi highlighted that exploration is crucial for optimal utilization of Oman's natural resources, aiming to increase reserves and support production, thereby contributing to sustainable economic and social development and reinforcing the oil and gas sector's role in the national economy.
He emphasized that the agreement showcases Oman's attractive investment incentive framework, drawing leading international companies like PETRONAS to invest in offshore areas. Strategic partnerships between national companies and international expertise are vital for transferring advanced technologies and developing Omani talent in the sector. The agreement is seen as the start of a broader partnership with PETRONAS in Oman.
The concession for Block (18) aligns with Oman Vision 2040's objectives to ensure energy sector sustainability and maximize the added value of natural resources. Eng. Al Aufi expressed hope that drilling operations and seismic surveys will lead to new hydrocarbon discoveries, enhancing national reserves and strengthening Oman's global energy position.
He also noted the comprehensive work program planned by the investing companies, involving technical studies and potential geophysical surveys in deepwater areas, alongside exploratory drilling to fully assess the concession's potential. He wished the partners success in their exploration activities in Block (18).
Dr. Anwar Sulaiman Al Kharousi, Chief Commercial Officer of OQ Exploration and Production, stated that the agreement adds significantly to the company's offshore portfolio, reinforcing its exploration and production activities. The partnership with PETRONAS builds on strategic cooperation, supporting expertise transfer and technical knowledge exchange.
Muhammad Redhani Abdul Rahman of PETRONAS affirmed the company's commitment to expanding its exploration portfolio in promising areas, building on a Memorandum of Understanding with OQ Exploration and Production signed in the third quarter of 2025.
He added that PETRONAS will utilize its offshore exploration expertise and modern deepwater technologies, in collaboration with partners, to assess the block's hydrocarbon potential, support long-term energy security, and strengthen its investment presence in Oman.
The investing companies are expected to conduct comprehensive geophysical surveys and technical studies, along with exploratory drilling, to assess the hydrocarbon potential of the area, thereby enhancing Oman's position on the regional and global energy map.