Iran and Oman have agreed to jointly develop the Hengam oilfield, near the Strait of Hormuz in the Persian Gulf.

Iranian Oil Minister Javad Owji said this week that both nations have agreed to form a committee to develop the oilfield, Iran’s semi-official news agency Fars reported.

“As the first basis of my talks with Omani Oil Minister Mohammed bin Hamad al-Rumhi, it was agreed to form a joint technical committee to develop the next phases of the Hengam oilfield in a seamless manner between Iran and Oman,” Owji said.

Both nations had previously signed an agreement in 2005 to jointly develop the Hengam field — the reservoir of which is shared by Iran and Oman — but the deal did not materialise and Iran decided to develop the field independently in 2012.

However, in a fresh impetus to the oilfield’s development, Owji said that “joint exploitation, in contrast to competitive exploitation, will be mutually beneficial to both countries as this method leads to less damage to the reservoir and allows for more extraction”.

Oman and Iran have signed eight memoranda of understanding and four co-operation programmes in sectors including oil and gas, Oman’s state news agency reported on Monday.

The agreements were signed during a visit by Iranian President Ebrahim Raisi to Muscat, it noted.

The Hengam reservoir has extremely light oil of 50 degrees API, which is described by some as condensate and by others as gas.

A few years go, Hengam was producing about 30,000 barrels per day from four wells, but its present production could not be confirmed by Upstream.

Iran has previously asserted claims for 80% of the reserves at Hengam, which has been estimated to hold 700 million barrels in place, of which 100 million barrels are seen as recoverable reserves.

Tehran has also recently agreed to revive a long-stalled project to lay a subsea pipeline to carry the gas to Oman.