Shell starts gas production from prolific Middle East onshore asset

Shell Integrated Gas Oman has started gas production from the Mabrouk North East field in Block 10 onshore Oman.

The subsidiary of UK supermajor Shell confirmed production start-up from the key Omani asset and said that production from Block 10 is expected to reach 500 million cubic feet per day of gas by the middle of next year.

Shell said the gas produced from Block 10 “will be supplied to the OQ Gas Network, feeding local industries and export facilities”.

However, the company did not disclose the initial gas production volumes from Block 10.

Shell holds a 53.45% working interest in Block 10, with Oman’s OQ and Marsa Liquefied Natural Gas — a joint venture between TotalEnergies and OQ — holding 13.36% and 33.19%, respectively.

The concession agreement for Block 10 was signed in December 2021 and Shell was later appointed the block’s operator.

Strategic block

Block 10 is said to be strategic for Oman and is expected to bridge the gap between the nation’s gas supply and future consumption needs.

Salim bin Nasser Al Aufi, Oman’s minister of energy and minerals, said the accomplishment strengthens the nation’s rich natural gas reserves “while bringing value to support Oman’s energy transition and net-zero ambitions by 2050”.

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“Attracting foreign investment to Oman is a key enabler for achieving economic growth and realising [the] Oman Vision 2040,” he noted.

In the initial phase, state-controlled Petroleum Development Oman is building the infrastructure for the project, including the main pipeline to the Saih Rawl gas processing facility, Shell said in 2021.

A senior Omani official earlier said that Shell and its partners in Oman’s Block 10 are expected to invest $2 billion in developing key facilities required for the gas-rich onshore acreage.

Key milestone

Walid Hadi, Oman Shell’s senior vice president, said the Block 10 start-up is an “important milestone ahead of schedule”.

In addition, Shell and the government of Oman are developing options for a separate downstream gas project whereby the supermajor could produce and sell low-carbon products and support the development of blue hydrogen in Oman.

“The proposed blue hydrogen project is subject to further agreements and future investment decisions,” Shell added.

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The gas-rich Block 10, which covers 1200 square kilometres, is located in the Al Wusta region of Oman about 400 kilometres from the capital city, Muscat.

LNG export facility

The Marsa LNG joint venture, in which TotalEnergies holds an 80% stake, was created recently as a liquefied natural gas export company.

It plans to sell gas from Block 10’s Saih Rawl field to the government for 18 years, or until the start-up of the planned LNG plant.

TotalEnergies is understood to be separately carrying out a tender process for the LNG export facility destined for Marsa LNG, but is yet to formally announce the winner.