OQEP reports nine-month revenue of $1.64bn

17/11/2025 04:06 AST

Oman's leading exploration and production company, OQ Exploration and Production (OQEP), has announced its financial results for the fiscal nine months ended September 30, 2025.

The company reported significant financial highlights, including revenue of OMR 633.8 million (approximately $1,648.3 million) and an EBITDA of OMR 471.2 million (around $1,225.6 million).

Additionally, the adjusted cash flow from operations increased by 10 per cent to OMR 424.8 million ($1,104.8 million), with a solid return on capital employed (ROCE) of 23.3 per cent.

Operationally, OQEP maintained stable production levels at 224.4 kboepd, comprising oil and condensate production of 121.2 kbblpd (compared to 125.3 kbblpd in 9M 2024) and gas production of 103.2 kboepd (slightly down from 103.5 kboepd in 9 million 2024).

This growth has been supported by key asset enhancements, including the Bisat C Expansion at Block 60, which is now producing over 70 kboepd (gross), and the extension of the Block 53 EPSA to 2050, offering improved fiscal terms.

Future revenue prospects are bolstered by new commercial agreements, such as the Natural Gas Sales Agreement to supply Marsa LNG from Block 10 and the Gas Sales Agreement with the Integrated Gas Company.

Moreover, OQEP has formed new partnerships, signing exploration agreements with Genel Energy for Block 54 and MOUs with Turkish Petroleum Corporation and Petronas.

Regarding shareholder returns, OQEP has declared a total base dividend of OMR 173.1 million at 7.21 baizas per share.

Additionally, a Performance Linked Dividend (PLD) for H1 2025, amounting to OMR 44.2 million or 5.52 baizas per share, will be paid in two equal instalments.

The second instalment of the H1 2025 PLD, set at 2.76 baizas per share, is scheduled for payment on 25 November 2025 to shareholders registered before 13 November 2025.

The current share buyback program targets 45-60 million shares, with approximately 50 per cent of this target already achieved.

Mahmoud Al Hashmi, Acting Chief Executive Officer, OQEP, commented: "OQEP's strategy supported its performance over the past nine months despite market challenges. The Company increased its sales volume of oil and condensates by nearly 12 per cent during this period, which offset lower oil prices and resulted in revenue and EBITDA similar to last year's results. OQEP also reported a 10 per cent rise in its adjusted cash flow to OMR 424.8 million and a return on capital employed of 23.3 per cent.

"The Bisat C Expansion at Block 60 is now fully operational which directly enhances the production from Block 60. Several new commercial agreements were signed, including the extension of the Block 53 EPSA to 2050 with new fiscal terms. Marsa LNG entered into a Natural Gas Sales Agreement for 150 mmscfd from Block 10; the Marsa LNG project is currently over 25 per cent complete. OQEP and its partner Oxy signed the Block 65 Gas Sales Agreement with Integrated Gas Company (IGC), allowing the monetisation of produced equity entitlement."

"OQEP also entered partnership and exploration agreements with international operator Genel Energy in Block 54 and signed MOUs with Turkish Petroleum Corporation (TPAO) and Petronas."

"OQEP delivered significant value to its shareholders during the past nine months. OQEP paid out more than OMR 173 million in base dividend, the quarterly dividend of 7.21 baizas per share. OQEP also paid its first Performance Linked Dividend for the first half of the year. This totalled more than OMR 44 million or 5.52 baizas per share which were paid in two equal instalments at 2.76 baizas per share whilst the second instalment is due for payment on 25 November 2025. The share buyback programme has made good progress with around 50 per cent of the target 45-60 million shares have been acquired reflecting our commitment to enhance the shareholders' value."

"OQEP continues to operate as the National Upstream Champion in support of Oman Vision 2040 and aims to close out the financial year in collaboration with employees, partners, and the Government of Oman."

On a year-over-year basis, OQEP delivered financial results that were broadly consistent with the previous period, despite a nearly 13 per cent decline in the average realised sales price of Oil and Condensates.

The Company increased its sales volumes of Oil and Condensates by 11.8 per cent compared to the nine months of 2024, which contributed to achieving revenue performance comparable to that of 2024.

The average realised sales price for Oil and Condensates was $72.0 per barrel, compared to $82.6 per barrel for the same period in 2024.

EBITDA remained steady at OMR 471.2 million ($1,225.6 million), with a margin of 74 per cent. Net profit, excluding Abraj, fell 9 per cent to OMR 236.9 million ($616.0 million), primarily driven by higher finance costs and lower oil prices.

Capital Expenditure rose 7 per cent to OMR 198.7 million ($516.7 million), mainly due to completing the Bisat C Expansion at Block 60 and investing in Block 53.

Free Cash Flow reached OMR 198 million, while Return on Capital Employed for the nine months of 2025 was 23.3 per cent, a top quartile return performance for the energy sector.

OQEP's cash balance of OMR 161.2 million ($419.3 million) reduced Net Debt to OMR 222.1 million ($577.6 million), resulting in a leverage ratio of 0.35x EBITDA.

OPERATIONAL REVIEW
OQEP manages a diverse portfolio of fourteen upstream oil and gas assets in Oman, with nine currently producing.

The Company either operates these concessions or partners as a non-operating participant with joint venture partners. Assets range from development and production to appraisal and exploration stages.

Throughout the first nine months of 2025, OQEP undertook several initiatives and entered into agreements to develop and expand its asset portfolio.

The Bisat C Expansion at Block 60 became fully operational, resulting in increasing production.

OQEP, together with Oxy and its other Block 53 partners, signed an agreement with the Ministry of Energy and Minerals to extend the Block 53 EPSA to 2050.

Block 53 EPSA is an oil asset which accounted for approximately 7 per cent of the Company's working interest production.

The Block 53 EPSA partners envisage a potential additional 800 million gross oil barrels for future development, with the Block 53 EPSA extension providing improved fiscal terms.

OQEP continues to collaborate with BP and the other Block 61 partners to revise the asset development plan for Block 61.

The updated plan anticipates the development of up to 2 TCF of additional recoverable gas resources to support future growth initiatives.

Block 61 accounts for approximately 41 per cent of the Company's working interest production and is recognised as one of the largest tight gas reservoirs, representing a significant new source of natural gas for Oman.

Block 61 produces 1.5 billion cubic feet of gross gas per day, which is distributed through Oman's national gas grid.

Marsa LNG has signed a Natural Gas Sales Agreement with IGC for its 150 mmscfd equity from Block 10.

The Marsa LNG project is over 25 per cent complete and will feature a fully electric liquefaction plant powered by a dedicated solar facility, aiming to be among the lowest GHG emission LNG plants globally.

The plant will help meet rising marine LNG demand.

Additionally, OQEP on 2 November 2025, together with its partner, Oxy, signed a Gas Sales Agreement with the IGC to supply gas from Block 65. This long-term agreement, effective though 2037, supports the monetisation of OQEP's equity gas entitlement and strengthens the Company's long-term cash-flow profile.

In terms of exploration, OQEP continued to develop its growing roster of international partners to mitigate risk and develop technical knowledge.

OQEP entered into an Block 54 EPSA with Ministry of Energy and Minerals and Genel Energy on 10 March 2025. Extensive evaluation of previous exploration data is well under way.

Following promising exploration results, OQEP, together with its Block 47 partner, ENI Oman B.V. ("ENI"), has been granted a six-month extension to the Block 47 EPSA.

This extension allows the completion of post-well technical studies and the development of a firm strategy for Block 47.

OQEP, as part of its co-operation with the Ministry of Energy and Minerals, together with the financial advisor, Scotiabank, continued to assist in the marketing of Blocks 18, 36, 43A and 66, to bring further new investment into Oman's exploration and production sector.

These blocks form part of the 15 blocks that the Ministry of Energy and Minerals intends to market during the course of 2025 and 2026.

Post-period, OQEP and Petronas, Malaysia's national energy company, entered into a Memorandum of Understanding establishing a framework for strategy collaboration in international upstream oil and gas ventures.

DIVIDEND AND SHARE BUYBACK PROGRAMME
OQEP's dividend policy prioritises sustainable returns and disciplined capital allocation. The Company plans to deliver a base dividend of OMR 230.7 million ($600 million) in both

2025 and 2026, with an additional Performance-Linked Dividend ("PLD") equal to 90 per cent of the Company's expected free cash flow minus the base dividend.

The dividend payment remains subject to Board and shareholder approvals, the prevailing market conditions and the long-term value considerations for the Company.

OQEP also initiated its first share buyback programme to further enhance shareholder value. The programme is targeting the repurchase of 45-60 million shares by February 2026.

OUTLOOK
OQEP expects production for the full year 2025 to be within the range of 220-230 kboepd net working interest; Operating Expenditure to be less than $10/boe; and Capital Expenditure to be within the range of $0.8 - 0.9 billion.

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