TBY talks to HE Salim bin Nasser bin Said Al Aufi, Undersecretary to the Ministry of Oil and Gas, on key developments in 2015, and increasing oil demand.

HE Salim bin Nasser bin Said Al Aufi
HE Salim bin Nasser bin Said Al Aufi is a graduate of Heriot-Watt University with Master's Degree in Petroleum Engineering. He joined Petroleum Development Oman (PDO) in 1992 and progressed within the organization in different technical and leadership capacities to become the North Oman Director in 2010. Throughout his career Salim held different local and international posts, including head of corporate planning, chief petroleum engineering and operation manager roles. During his period with PDO, Salim was posted to work for Shell Nigeria as Petroleum Engineer and Asset Planner and also to Shell Canada as the VP of Production. Salim was appointed as the Chief Executive Officer for the Public Authority for Civil Aviation in 2012 and in 2013 he was appointed as the Undersecretary for the Ministry of Oil & Gas.

What are the most important developments that have taken place under the Ministry of Oil & Gas in the past year?

We have recently added 393 million barrels of oil and condensate of reserves, which brings the total expected reserves to 5,306 million barrels. On the gas side, we have added 1.9tcf, and the total of expected gas reserves is 24.3tcf. Production-wise, we produced an average of 943,000 barrels per day last year. If the numbers are converted to annual figures, there was a positive delta on both sides. The upstream and downstream operating companies in total have added an additional 1,600 Omani jobs, making the total Omani jobs almost 12,000 positions against a total of 15,000; Omanization is at about 79%. We have also signed an agreement with Medco Arabia, the Indonesian company, and Intaj, a local company, to initiate a six-year exploration program of Block 56.

What is the emphasis for the MOG this year?

We are continuing to target 980,000 barrels of production. In March we had reached close to 970,000. This year will present a challenge because we are adding 40,000 barrels from last year. It goes without saying that we are aiming to meet the national requirement in terms of gas demand, and we will continue to produce 110 million cubic meters of gas, plus imports, which cannot exceed 5.8 million cm. We are looking ahead in terms of what we can supply because demand is increasing every year. Production levels are higher so we will need to use more reserves. Nevertheless, we will aim to replace whatever we consume during the year.

How are the Khazzan and the Iranian projects progressing?

Khazzan is operating six rigs, and there is a lot of activity on the facilities side. All indications say that gas will be ready for delivery by early 2018. From what we have seen thus far, the project will be able to deliver 1bcf as expected. The Oman-Iran gas project is moving in the right direction, and we are now in ongoing discussions regarding the route that the pipeline will take. After we survey the 200km offshore stretch from Oman to Iran and the 200km onshore on the Iranian side, we can begin talks about financing.

What are the Minstry of Oil and Gas's priorities for 2015 and future expectations?

Our main priority for 2015 is to ensure that we maintain production for the country at, or above, the national objective of 950,000 barrels/day. We are also aiming to keep the reserve replacement ratio at or above one. We will also focus on maintaining Omanization at the correct level and increasing development and training in order to advance Omanis to senior positions. We need to continue marketing the open blocks to maximize the exploration efforts and results. We have 14 open blocks onshore and offshore, and we will continue to market these. We plan to do more in terms of data acquisition and applying that data to improve our marketing strategies. This will give us a better advantage and put us in a slightly stronger position to demand more for the blocks we have worked on.