Oman, which is in talks with BP over the development of its first major unconventional gas project, has also been in talks with Iran to import gas for domestic consumption, a senior government oil official said.

"We've been discussing with Iran to import gas to Oman and we will continue to discuss that, for Oman requirements," Nasser bin Khamis Jashmi, undersecretary at Oman's ministry of oil and gas said.

"There is a discussion about a gas pipeline to India but we have not reached that stage of serious discussion," Jashmi said, adding talks involved private entrepreneurs and not the ministry. "It's mainly the call on Iran, if they finalize that agreement." 

 

Non-Opec oil producer Oman sees oil prices at a range of $90 to $100 per barrel in 2012 and is not expecting any major changes in the market, he added.

"We're expecting the same range to continue next year, from $90 to $100," said Jashmi.

"We don't see anything that will drastically change the market next year... What we'd like to see is something different but it's whatever the market dictates," he said.

The small oil producer expects to exceed its crude oil production target by at least 5 percent in 2011 to reach up to 920,000 bpd this year, giving its oil revenues, crucial for its budget, a boost.

"There are fundamental demand and supply factors which we think should hold for next year. But there are also other factors, geopolitical issues and other factors which might affect," Jashmi said.

Oman's crude oil production rose 3 percent in the first eight months of the year, while its exports edged up by less than 1 per cent, finance ministry data showed.

The sultanate produced a total of 188.78 million barrels of crude in the period from January 1 to August 31, with average daily production rising to 881,900 barrels per day (bpd) from 858,200 bpd in the same period of 2010.

The country's exports rose to 177.19 million barrels in January to August from 175.92 million barrels in the corresponding period last year.

Its biggest customer was China, accounting for almost 45 percent of Oman's crude exports, followed by India and Japan.

It sold at an average price of $100.99 a barrel in the first eight months. The price for August only was at $107.84 a barrel, down from July's $109.20 a barrel.

The country based its 2011 budget on a projected oil price of $58 a barrel.

The country's natural gas production rose by 5.4 per cent to 23.029 billion cubic meters in Jan-August period, the data showed.