Sweden based Oil and Gas firm, Tethys Oil announced in a statement that through its wholly owned subsidiary Tethys Oil Montasar Ltd (Tethys), has entered into an agreement with EOG Resources Oman Block 49 Limited (EOG), a wholly owned subsidiary of EOG Resources, Inc., for EOG to obtain a 50 percent interest in the Exploration and Production Sharing Agreement (EPSA) covering Block 49 onshore Oman.
Block 49 comprises of 15,439 km2 (approximately 3.8 million acres) onshore the South West of the Sultanate of Oman . Under the agreement, EOG will also have the option to assume operatorship of the Block and increase its interest to 85 percent for any operation relating to unconventional hydrocarbon resources.
As per the statement, the agreement is subject to government approval.
EOG will acquire access to the data from several thousand line kilometers of 2D seismic grids, two recently acquired seismic surveys (2D and 3D), nine exploration wells plus additional geotechnical studies and reports.
As consideration for both the 50 percent interest and access to data, EOG will refund all costs incurred on the Block and fund the Thameen-1 exploration well, up to a combined amount of MUSD 15.
Tethys will continue as operator for the first exploration period including the drilling of the Thameen-1 well. After the commitments for the first period have been satisfied, EOG will have the option to take over operations of the block and increase its interest to 85 percent for any operation relating to unconventional hydrocarbon resources.
Should EOG exercise its option, Tethys would retain a 15 percent interest. The agreement includes consideration if the option is exercised and in the case of commercial development of unconventional hydrocarbon resources. The parties would retain 50 percent each of any operations relating to conventional hydrocarbon resources.
Tethys Oil was awarded Block in 2017. After three years of seismic work, including reprocessing of older seismic data and processing and interpretation of seismic data from two new campaigns, Tethys is ready to drill the Thameen-1 well. The well is expected to spud in mid-December 2020 and to be drilled to a depth of close to 4,000 meters to evaluate three potential reservoir targets.
The initial three-year exploration phase for Block 49 has been extended with one year and runs until December 2021. The EPSA holders can elect to enter into a second exploration phase of an additional three years.
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