Oman Eyes 2010 Crude Output Hike

Oman aims to boost crude output for the third year in a row in 2010, a top official said, even after its largest producer, PDO, saw output fall in 2009.

Oman is a small, independent producer, but has an influence on the price of more than 10 times more crude than it produces. Oman's oil is part of a benchmark price used to value around 10 million bpd of crude exports from the Middle East to Asia.

The country plans to boost output to an average of 860,000 bpd in 2010, said state undersecretary for oil and gas Nasser Al-Jashmi at a press conference in Oman.

That would be up nearly 6% from output of 812,500 bpd in 2009 and would mark the third consecutive year of increased crude output from Oman.

The sultanate has spent heavily to reverse output decline from its ageing fields. Output peaked in 2001 at 956,000 bpd before declining every year through 2007.

The country's largest oil producer, state-controlled Petroleum Development Oman, pumped less crude in 2009 than the previous year even as the country's total output rose by 7.4 %.

PDO, an affiliate of Royal Dutch Shell, pumped 552,000 bpd of crude in 2009, the company said in a statement on 15 February 2010. That was down from the 566,000 bpd crude output the company reported for 2008.

PDO pumps just under 70% of Oman's crude output and sees little change in its production targets over the next few years, said managing director John Malcolm.

"We will continue with the target of 540,000 bpd to 560,000 bpd for the next few years," Malcolm said. That was steady from the previous two years.

Still, PDO's total oil output, which includes condensates and liquefied petroleum gas (LPG), rose to 641,000 bpd in 2009 from 633,000 bpd the year before.

PDO made four oil discoveries last year that could eventually add up to 1 billion barrels of recoverable reserves in Oman over the next 10-15 years, Malcolm said. Oman had reserves of 5.6 billion barrels of oil at the end of 2008, according to BP's statistical review.

Malcolm declined to say when the new discoveries might start producing oil. - Trade Arabia