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Oman : -$1.2bn contract for BP’s Khazzan project
Publish Date : 24-Feb-2014
Petrofac, the international oil and gas services provider, has won a contract to set up a central gas processing facility valued at around $1.2 billion for BP's Khazzan gas project in Block 61 onshore Oman.
The scope of work will include engineering, procurement and construction (EPC) of the central processing facility (CPF) at the Khazzan field. The CPF will include two process trains, each having a capacity of 525 million standard cubic feet of gas per day. The project also includes an associated condensate processing system, power generation plant, water treatment system and all associated utilities and infrastructure. The project is expected to be completed in 2017.
Subramanian Sarma, Managing Director of Petrofac's Onshore Engineering & Construction business, commented: “Petrofac has executed a large number of projects for BP across many aspects of our business and we are delighted to be supporting them on this pioneering project at Khazzan, the largest new upstream project in Oman. We have a very strong record for project execution in Oman with this project representing Petrofac's eighth EPC contract in the Sultanate and follows the recent award of the $2.1 billion Sohar refinery improvement project which was announced in November. Furthermore, consistent with our commitment to developing Omani in-country value whilst also providing opportunity for local content wherever we work, we will also seek to do so for the duration of this contract via the supply chain and recruitment of local resources.”
The contract award comes just a week after His Majesty the Sultan issued a Royal Decree ratifying the amended production sharing agreement between the Omani government and BP for the development of the Khazzan field. The amended agreement along with a landmark gas sales agreement was inked by the two sides last December.
The Khazzan Project has been described as the largest new upstream project in Oman and a pioneering development in the region in unlocking technically challenging tight gas through technology. Its successful exploitation will contribute to meeting the growing demand for energy over the coming decades and stimulating economic development in the Sultanate.
With the award of the contract for the central processing facility, development of the Khazzan field is expected to pick up pace. Full field development will involve a drilling programme of around 300 wells over 15 years to deliver plateau production of one billion cubic feet (28.3 million cubic metres) of gas per day and 25,000 barrels per day of gas condensate.
This volume is equivalent to around a third of Oman's total daily domestic gas supply and will make a significant contribution to ensuring continuing stable supplies from domestic sources.
