Tethys Oil announced that it has entered into an Exploration and Production Sharing Agreement (EPSA) with the Government for Block 58 onshore Oman.

The block is located in the southern part of the Sultanate adjacent to Tethys Oil’s operated exploration licence Block 49. Tethys Oil will through its wholly owned subsidiary Tethys Oil Qatbeet be the operator of the block and hold a 100 per cent license interest.

A total of 7,600 km of 2D seismic and 1,100 km2 of 3D seismic data acquired by previous operators has been made available to Tethys Oil as well as raw logs and well reports from two wells drilled within the block boundaries. Both wells encountered hydrocarbon shows.

“We are very happy to have been given the opportunity to explore for hydrocarbons on Block 58. The signing of this EPSA represents another step in Tethys Oil’s strategy in Sultanate of Oman. I would like to take this opportunity to express our sincere thanks to the Government of the Sultanate of Oman for this exciting opportunity,” says Tethys managing director Magnus Nordin.

The EPSA deal for Block 58 covers an initial exploration period of three years with an optional extension period of another three years. In case of a commercial oil or gas discovery, the EPSA will be transformed in to a 15 year production license which can be extended for another five years.

In case of a commercial discovery, an Oman Government Company has a right to acquire up to a 30 per cent interest in Block 58 against refunding of past expenditure. The initial work commitments during the first period include a 3D seismic campaign and drilling of two exploration wells.

 (Source: Pipeline)