Oil and gas multinational BP has signed deals on tight gas projects worth $16 billion in Oman as well as a non-binding agreement to develop a 1 million t/y acetic acid plant at Duqm, Oman, on the Arabian Sea.

The Khazzan gas project is said to be the largest new upstream project in the Middle East sultanate, aiming to extract around 1 billion cubic feet of gas. It is expected to be a showcase for BP's extraction technology.

The British group plans to develop about 7 trillion cubic feet of gas as well as pumping around 25,000 barrels per day of gas condensate from the field. The production sharing agreement and a gas sales agreement allow BP to appraise more gas resources in Oman's in block 61, in which it will own a 60% stake. Oman Oil Company Exploration & Production (OOCEP) will have a 40% stake.

BP plans to use technology relatively new to the Middle East, including horizontal wells and advanced hydraulic fracturing (fracking) to reach gas tightly embedded in sandstone.

If the project is successful, it could be a precursor to other unconventional natural gas extraction efforts in the Persian Gulf and North Africa, experts suggest. When maximum output is reached in 2018, it is thought likely to increase Oman's current production by about a third.