Indian Oil makes its first producing upstream acquisition in Oman

Leading oil marketing company Indian Oil Corporation (IOC) has acquired 17 percent participating interest in Mukhaizna Oil Field, including the marketing rights for entitlement oil, by acquiring 100 percent equity stake in Shell Exploration & Production Oman Ltd (SEPOL) from Shell Overseas Holdings for US$ 329 million (Rs 2,078 crore).

This move, according to IOC, will provide a major boost to its E&P business and is aimed to enhancing Indian Oil’s presence in the upstream sector in the Middle East. 

The Mukhaizna oilfield is the single largest producing individual oil field in Oman, contributing  around 13 percent of total Omani crude production with current production of 120,000 barrels per day. One barrel equals 42 US gallons or 35 UK (imperial) gallons, or approximately 159 litres.

The Mukhaizna oilfield is also the largest steam flood project in the Middle East. The field is operated by Occidental Mukhaizna (45%). The other partners are Oman Oil Company S.A.O.C (20%), Liwa Energy Ltd (15%), Total E & P Oman (2%) and Partex (Oman) Corporation (1%). 

This is Indian Oil’s first producing upstream acquisition in Oman which will further enhance its growth in the upstream sector in the Middle East. The acquisition also has a significant strategic importance to India, both in terms of augmenting India’s energy security as well as enhancing India’s stature in the global political and economic arenas.