Oman Oil and Gas Report Q4 2010
Friday, Oct 22, 2010

Research and Markets (http://www.researchandmarkets.com/research/73ad8c/oman_oil_and_gas_r) has announced the addition of the "Oman Oil and Gas Report Q4 2010" report to their offering.

“Oman Oil and Gas Report Q4 2010”

Business Monitor International's Oman Oil and Gas Report provides industry professionals and strategists, corporate analysts, oil and gas associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Oman's oil and gas industry.

The latest Oman Oil & Gas Report from BMI forecasts that the country will account for just 0.8% of Middle East (ME) regional oil demand by 2014, while providing 3.07% of supply. Regional oil use of 4.98mn barrels a day (b/d) in 2001 rose to 7.15mn b/d in 2009. It should average 7.42mn b/d in 2010 and then rise to around 8.38mn b/d by 2014. Regional oil production was 22.83mn b/d in 2001 and averaged 24.41mn b/d in 2009. After an estimated 24.86mn b/d in 2010, it is set to rise to 26.67mn b/d by 2014. Oil exports are growing steadily, because demand growth is lagging the pace of supply expansion. In 2001, the region was exporting an average 17.85mn b/d. This total eases to an estimated 17.44mn b/d in 2010 and is forecast to reach 18.30mn b/d by 2014. Iraq has the greatest export growth potential, followed by Qatar.

In terms of natural gas, the region consumed 379.2bn cubic metres (bcm) in 2009, with demand of 481.4bcm targeted for 2014, representing 22.1% growth. Production of 407.2bcm in 2009 should reach 588.9bcm in 2014 (+26.2%), which implies net exports rising to 108.0bcm by the end of the period. In 2010, Oman will consume an estimated 3.80% of the regions gas, with its market share forecast at 4.22% by 2014. It will contribute an estimated 5.57% to 2010 regional gas production, and by 2014 will account for 5.69% of supply.

For 2010 as a whole, we continue to assume an average OPEC basket price of US$83.00/bbl, +36.4% year-on-year (y-o-y). Risk is now clearly on the downside, thanks to the slow progress made during June. However, a full-year outturn in excess of US$80 remains a strong possibility and we see no need to review our assumptions at this point. The 2010 US WTI price is now put at US$87.63/bbl. BMI is assuming an OPEC basket price of US$85.00/bbl in 2011, with WTI averaging US$89.74. Our central assumption for 2012 and beyond is an OPEC price averaging US$90.00/bbl, delivering WTI at just over US$95.00.

For 2010, the BMI assumption for premium unleaded gasoline is an average global price of US$95.45/bbl. The overall y-o-y rise in 2010 gasoline prices is put at 36%. Gasoil in 2010 is expected to average US$93.23/bbl. The full-year outturn represents a 35% increase from the 2009 level. For 2010, the annual jet price level is forecast to be US$95.90/bbl. This compares with US$70.66/bbl in 2009. The 2010 average naphtha price is put by BMI at US$83.53/bbl, up 41% from the previous years level. Omans real GDP is assumed by BMI to rise by 4.4% in 2010, with average annual growth of 3.0% forecast in 2010-2014. We expect oil demand to rise from an estimated 67,000b/d in 2010 to 82,000b/d in 2014. Partly state-owned Petroleum Development Oman (PDO) accounts for more than 80% of the oil and gas produced in the country, but relies on international oil companies (IOCs) to maintain volumes. Our estimates assume 850,000b/d of 2010 production, before volumes sink to 820,000b/d by the end of the forecast period. Gas production should reach 33.5bcm by 2014, up from an estimated 26.0bcm in 2010. Consumption is expected to rise from an estimated 15.0bcm to 20.3bcm by the end of the forecast period, allowing net exports of 13.2bcm.

Between 2010 and 2019, we are forecasting a decrease in Omani oil production of 23.8%, with crude volumes peaking at 850,000b/d in 2010, before falling steadily to 648,000b/d by the end of the 10-year forecast period. Oil consumption between 2010 and 2019 is set to increase by 55.1%, with growth slowing to an assumed 5.0% per annum towards the end of the period and the country using 104,000b/d by 2019. Gas production is expected to reach 40bcm by 2018-2019. With 2010-2019 demand growth of 69.8%, this provides an export capability peaking at 15.7bcm in 2018. Details of BMIs 10-year forecasts can be found in the appendix to this report.

Oman holds seventh place, above Kuwait and Saudi Arabia, in BMIs composite Business Environment (BE) ratings table, which combines upstream and downstream scores. The country now holds seventh place, ahead of Kuwait, in BMIs updated upstream Business Environment ratings. Its score benefits from a sound country risk profile, good licensing terms and a healthier privatisation trend than that seen elsewhere in the region. It is capable, over the longer term, of challenging Iran, which is currently above it. Oman is below the middle of the league table in BMIs updated downstream Business Environment ratings, with a few high scores and further progress up the rankings a medium-term possibility. It is ranked seventh, ahead of Kuwait and Bahrain, owing to low scores for refining capacity, oil demand, retail site intensity and gas demand growth outlook. Healthy country risk factors, oil demand growth potential and moves towards deregulation and privatisation help bolster the overall score.

 

Source: Business Wire

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