BP has agreed a price for any gas produced from Oman’s Khazzan project as part of a commercial framework agreement with the government, the energy company said on Thursday.
BP has been negotiating for months over the price it will get for selling any gas produced from the Khazzan tight gas project to the local market.
The two sides have now agreed the price as part of a commercial framework which includes expected volumes and investment costs.
“We are pleased to have reached a price agreement that is acceptable to the government of Oman and delivers value to BP,” a spokesman for the company said.
Artificially low government-controlled prices typical across the Gulf have discouraged new projects needed to meet the region’s rising demand for natural gas.
The spokesman declined to give the agreed gas sales price.