Oman's premier oil company, Petroleum Development Oman, held its annual media briefing in late February. It was the first given by new managing director, Raoul Restucci. PDO's production of crude oil for 2010 averaged 553,000 barrels/day (b/d), well within its target range of 540,000-560,000 b/d, but only a disappointing 1,000 b/d more than average daily production for 2009. This was in part due to the delay in the commissioning an enhanced oil recovery (EOR) project at Harweel, which had been scheduled for mid-2010. Although the production of crude oil has changed little, the amount of condensate increased by 7% year on year to 95,000 b/d in 2010. The most significant increase however was gas production, which rose by 9% from an average of 410,000 barrels oil equivalent/day (boe/d) in 2009 to 446,000 boe/d. Gas now accounts for more than 40% of PDO's production. The briefing document emphasises that in 2010 gas availability to PDO's customers was 100%; in other words, customers were always able to call on their contracted volumes of gas. This should be welcome news to the government, as there have been concerns for some time about gas demand outstripping supply. Overall, PDO's total production of hydrocarbons increased by 4% year on year in 2010, to 1.09m boe/d. Mr Restucci said that PDO is committed to a long-term oil-production target of 550,000 b/d for the next few years, while total hydrocarbons production is expected to rise to 1.2m boe/d by 2014.

PDO is investing heavily in EOR projects to help maintain production of crude oil in its mature and geologically complex oil fields. Mr Restucci acknowledged that the company's flagship EOR projects, each of which is expected to contribute an additional 40,000 b/d to production, have experienced delays. At Harweel, a miscible gas project involves gas being injected into the oil reservoir under high pressure. The oil dissolves in the gas and the mixture moves more easily through the rock to be extracted through producing wells. Harweel is now expected to start producing oil in the second quarter of 2011. At Qarn Alam, a steam-assisted gravity-drained project has also experience delays. The first steam stages are now expected in October 2011. PDO has become, of necessity, a pioneer of EOR techniques; it is therefore hardly surprising if technological challenges have contributed to delays. This will no doubt be of little comfort to the government, who are primarily interested in increasing production and seeing a return on the large sums of money being invested in EOR. It is fortunate for Oman that high oil prices in recent years have made this production economically viable. PDO policy on future EOR projects changed during 2010 as plans for a thermal project at Thayfut, and miscible gas injection at Budour North-east, were scrapped in favour of lower-energy solutions of polymer injection and water flooding respectively.

Mr Restucci outlined oil and gas discoveries made by PDO during 2010, which potentially total over 800m boe. A large gasfield was discovered, together with four new oilfields. The most significant of these is at Amal South-east which could contain over 300m barrels of oil. It is near to the existing Amal oilfield where Oman's latest EOR project is under development. The oil discovered is viscous, and most production will therefore require EOR as part of the Amal steam-injection project. Oil discoveries were also made at Sayyah, Al Ghubar East, and Aqeeq. The gasfield was discovered at Khulud West. Although considered significant, the find, like much of Oman's gas, is what is described as "tight" gas, at high pressure and temperature, and with low permeability, making it hard and expensive to exploit.