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Omans economy is dependent on oil resources. Over 30 years petroleum products have enabled the countrys national development.

The main markets for oil exports are Asia, China and Japan. South Korea and Japan are the primary customers for consumption of natural gas. Natural gas reserves of Oman stand at 18 trillion cubic feet, which supplies the fuel for power generation and desalination. An LNG processing plant was opened in 2000, which is located in Sur with production capacity of 6.6 million tons/YR. In 2010 total petroleum liquid production in Oman was estimated to be 867,900 bbl/ day. Out of which 860,000 was crude oil. The standard taken to measure is total oil produced in barrels per day (bbl/day).

Country Oman

2001

2004

2005

2006

2007

2008

2009

963,800 775,000 769,000 740,000 714,300 758,600 816,000

The figure states that from 2001 2004 oil production in Oman had a steep fall, around 2004 to 2007 there was a stagnated phase and after 2007 there has been an increase in the oil production by 20 percent. The increase in production after 2007 was due to growth of new oil wells, improvement in reservoir management and advancement in implementation of shut-down activities. Oman increased productivity of oil by enhanced oil recovery (EOR) techniques. EOR deals with unconventional oil production methods, which involves altering the properties of oil. It is done so that the oil flows easily to the production well. Injection of steam is most commonly used approach of EOR, in this method high pressure is injected into the oil fields, and the steam heats the oil and makes it accelerate. The pressure even pushes the oil in the production well.

PETROLIUM DEVOLOPMENT OMANOil was first discovered in 1964 in Fahud area. Petroleum development Oman (PDO) initiated in 1967.PDO is the leading oil and gas production company of Oman. It withholds more than 70 percent of countrys crude oil and nearly all its Natural gas supply. PDO discovered and developed 180 fields totally, from which 126 still supplies Oil and gas, and the company drilled more than 4800 oil and gas Wells Well and reservoir management: The company made many contributions through well and reservoir management, which targets to optimise production from existing oil and gas fields. In 2006 average oil production was 589,000 barrels per day. There was even a growth in natural gas delivery. In 2008 total hydrocarbon production exceeded up to one million barrels of oil equivalent. In the year 2010 average oil production was 553,000 barrels.

Combined gas and condensate production was equivalent to 445,000 barrels of oil per day in 2007, the next consecutive year Combined gas and condensate production rose for the first time since 2000.In 2009 combined production of oil, gas and liquid petroleum gas was 641,000 barrels. The reason for increase in production was due to continues increase in condensate and LPG production. Combined production in 2010 reached up to one million barrels of oil equivalent per day. Operational Excellency: Operational Excellency deals with top class maintenance and conservation of all surface amenities. There is efficiency in the facilities and it also reduces cost of operations.

During 2005-2010 there were many smart field technologies initiated. Naith smart fieldwas launched in 2006 as a sustainable program to optimise oil production and minimise flaring of association gas. In 2007 smart field technology was proven worth at Fahud, Lekhwair, and Naith fields. In the following years Naith and Fahud fields were made more efficient through the installation of high-tech monitoring and controlling devices in well. This improved the field life and it made possible to increase the number of wells and equipments which were to be managed. Qarm Alam operations became more efficient in 2008. State of drilling control room was opened at Mina al Fahal in 2009, which lead to improvement in drilling activities. PDO drilled 480 new oil and gas Wells in this year. In 2010 the company focused on Smart technologies, they put into effect collaborative work initiative; they made efforts to reduce cost of operation. This year PDO drilled the deepest well in the Middle East using State-of-art technologies. Project delivery: Project delivery comprises of drilling and completing wells, building and commissioning facilities on time and within the budget. Kauther gas projects design was completed in 2006 and its gas plant was completed in 2007. Projects Mabroauk field development and Ufuq field facilities were commissioned in the year 2009. Marmul Polymer which is an enhanced oil recovery project (EOR) was given shareholders approval to initiate in 2006. In 2010 this project was inaugurated, the project indicated to add 10,000 barrels per day for the coming years. Gas directorate project was completed and Harweel misable gas project was also initiated in this year. Exploration and hydrocarbon maturation: In exploration and hydrocarbon maturation, the company finds hydrocarbon bearing reservoirs and built efficient ways to extract hydrocarbons from them. In 2006, new oil field Budour northwest was discovered in southwest, and stock tank oil initially in place (STOIIP) rose by 1.7 billion barrels in 2006. In 2007 STOIIP further increased by 3.2 billion barrels. Gas discoveries were made at Simr and Fahud southeast fields and a significant oil reservoir was discovered at Budour northwest. In 2010 a large gas field was found and PDO discovered four new oil wells, one with huge material quantity of oil.

SUSTAINABLE DEVOLOPMENT:

Sustainability refers to the development which meets the needs and requirements of the present generation without affecting the needs and requirements of future generation. It involves companys impact on environment, society and economy. While contributing to the national economy, a business must consider long term view when planning and implementing its operations .The three pillars of sustainable development can be classified as Planet, people and profit. Under these three factors, six major principles were stated by PDO. To protect the environment, manage its resources efficiently, generate profitability, benefit communities, respect and safeguard people and lastly work cooperatively with their stakeholders. The government of Oman anticipates its country in 2020 to have developed, trained and highly skilled workforce; Government and private sector to have an effective interface; efficient utilisation of natural resources and conservation of all the achievements with economic diversification.

CHALLENGES WHICH LIE AHEAD IN SUSTAINABLE DEVOLOPMENT: A number of challenges are faced by our globe; challenge of global warming is the main one. Other problems include pollution, loss of habitat and depletion of natural resources. These are the main treats caused by the human activities. Oil sector Companies should aim to reduce such damages to the environment. Other challenge is Drilling fluids also known as muds, which are used in drilling activities by the oil production companies. They can be very dangerous after use as they contain hazardous substances. They need to be managed properly or they can contamination to land and surface water. Saline Water is a by-product of oil production, the quantity of water obtained in the process is more than that of the oil obtained, and therefore it is a challenge for sustainable development. PDO states that it produces 6 barrels of water for every 1 barrel of oil. Large amount of saline water is produced in this process. This water cannot be directly disposed. Disposing will be a very expensive method; this water contains metals and other harmful waste elements, thereby bringing a challenge to sustainability.

MEASURES TAKEN FOR SUSTAINABLE DEVOLOPMENT In order to meet the future energy demands, investments must be made in renewable energy like hydrogen fuels, solar energy, and wind projects. In oil production industry cleaner production (CP) technique should be implemented. Cleaner production is an initiative used by a company. They are techniques to minimise wastage and maximise product output, it is a best way for sustainable development. Oman refinery and petrochemical industrys Mina al fahal (MAF) refinery have adopted cleaner production (CP) which processes crude oil to develop LPG, gasoline, kerosene, aviation turbine fuel (ATF), diesel, and fuel oil/long residue. This CP paper is an initiative taken by the company to protect the environment, and is a measure to prevent environmental degradation. Another sustainable development method which can be adopted is efficient utilisation of the main by-product of oil i.e. water.PDO adopted water management technique to maximise reuse and minimise the waste waters harmful environmental impacts, Re-use options of waste water by Reed bed system was established in southern Oman 2000. In this method Oilcontaminated water is filtered in the reed beds and then used to irrigate bio saline trees and bushes. This method proved to be most suitable and effective. To solve various problems of waste water in Oman another method was adopted, a compact container-size pilot plant is developed. The pilot plant will be used to demonstrate and verify water treatment through on-going operation, and serve as basis for the design of a full-scale plant. PDO implemented various objectives for sustainable development in economic performance also. Some of them are to focus on local tribe people in their operations with their

employment needs, local business development, contribute to young Omani companies and to maintain honest business relationships with its stakeholders. References: Petrolium devolopment Oman. 2011. Sustainable devolopment. [ONLINE] Available at: http://www.pdo.co.om/pdoweb/tabid/131/Default.aspx. [Accessed 25 March 12] Sultan Qaboos University. 2010. Third SQU-JCCP Joint Symposium. [ONLINE] Available at: http://www.squ.edu.om/portals/65/PDF/JCCP-SQU%20Program%20112-2010.pdf. [Accessed 25 March 12]. Petrolium Devolopment Oman. 2011. Annual reports. [ONLINE] Available at: http://www.pdo.co.om/pdoweb/tabid/161/default.aspx. [Accessed 16 March 12]. The oil drum. 2011. Oil Production Fears Increase as Unrest Spreads to Oman. [ONLINE] Available at: http://oilprice.com/Energy/Crude-Oil/Oil-Production-FearsIncrease-as-Unrest-Spreads-to-Oman.html. [Accessed 16 March 12]. The world factbook. 2011. Economy of Oman. [ONLINE] Available at: http://motherearthtravel.com/oman/economy.htm. [Accessed 16 March 12].