Swedish energy firm Tethys Oil has pledged to invest between $85 - 95 million in the development of its upstream oil and gas assets in the Sultanate of Oman during 2023.

The allocation is roughly on par with the company’s investments made across its sizable portfolio last year, the Stockholm-headquartered oil exploration and production firm said in a press statement. It includes the non-operated Blocks 3&4 where it holds a 30 per cent working interest, and its fully operated Blocks 49, 56 and 58.

The lion’s share of its allocation for 2023 is earmarked towards onshore Blocks 3&4 located in eastern Oman. Operated by CC Energy Development (with a 50 per cent interest), the producing blocks currently account for all of Tethys Oil’s revenues from its Oman assets. Tethys’ share of production from 3&4, corresponding to its net working interest after government take, averaged 11,136 barrels per day (bpd) in 2021, although the output for 2022 is understood to have marginally declined due to technical challenges. Mitsui E&P Middle East holds the remaining 20 per cent equity interest in the two adjoining blocks.

Tethys’ investments in Blocks 3&4, estimated at $65-75 million in 2023, will go towards, among other things, the drilling of a total of 47 new wells (compared to 36 in 2022), as well as support power generation and produced water handling capabilities, the company said.

Spending on Tethys Oil’s majority-owned and operated Block 56 is estimated at $8 million during 2023, down from $23.8 million last year. A good part of last year’s expenditure went towards the acquisition of 2,000 km2 of state-of-the-art 3D seismic, which is now ready for interpretation, according to Magnus Nordin, Managing Director.

“Over the next months, work on this Block should reach the same milestone of maturity, definition of drillable prospects with estimates of prospective resources, as we have reached on Block 58. While in parallel we continue to wait for the long-term test results from the Al Jumd discovery in Block 56,” he stated.

 

2023 spending on Block 49, another of Tethys Oil’s operated assets, is expected at a modest $1.5 million primarily to fund the re-entry and re-testing of the Thameen-1 well.

 

Nordin commented: “On Block 49 the Thameen-1 well will undergo re-testing in the first half of the year. Rock studies completed during 2022 suggests that the reservoir rock is very tight. To attempt to establish flows during the re-test, the reservoir sandstones will be fractured to create increased permeability to allow the reservoir fluids to flow to surface.”

 

Rounding off the list is Block 58 which stands to receive around $10.5 million of investment in 2023, primarily to finance the drilling of an exploration well at the beginning of Q3 2023 – an investment that could potentially unlock a new hydrocarbon resource for Tethys Oil.

 

“On Block 58 we have reached the important milestone of establishing drillable prospects with estimates of prospective resources that could be unlocked by the exploration drilling scheduled for the second half of 2023. And the numbers are impressive. If drilling is successful, the time, effort and money spent on Block 58 could be a transformative event for Tethys and a new source for future oil reserves,” Nordin added.

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