Minister of Petroleum Javad Owji says Iran agreed to form a committee with Oman to jointly develop the Hengam oilfield, which straddles their sea border.
Iran has its longest maritime border with Oman with which it has maintained the most sustained coexistence over the past five decades.
The two countries signed a memorandum of understanding in 2005 to jointly develop the Hengam oil field but the agreement did not materialize.
Owji visited Oman ahead of President Ebrahim Raeisi’s visit to the sultanate on Monday and agreed to revive a long-stalled project to lay an undersea pipeline to carry gas to Oman.
The project dates back to 2013 when the two countries signed a deal, valued at $60 billion over 25 years, for Iran to supply gas to Oman through an undersea pipeline.
On Monday, Owji was quoted as saying that the two sides also agreed to jointly work on Hengam which Iran had decided to develop independently in 2012.
"As the first basis of my talks with Omani Oil Minister Mohammed bin Hamad al-Rumhi, it was agreed to form a joint technical committee to develop the next phases of the Hengam oil field in a seamless manner between Iran and Oman," Owji said.
"Joint exploitation, in contrast to competitive exploitation, will be mutually beneficial to both countries as this method leads to less damage to the reservoir and allows for more extraction," the minister added.
President Raeisi took his “economic diplomacy” to Oman on his fifth foreign visit since taking office in August. A delegation of 50 business actors and executives are accompanying him in the visit.
The president has called for strengthening regional bonds especially in the Persian Gulf region.
Last year, Iran’s trade with Oman stood at $1.3 billion. Raeisi, however, said in Tehran before leaving for Muscat that this volume of trade did not reflect their full potentials in various sectors of economy.
According to the president, the two sides are set to sign several memoranda of understanding during his visit, mainly focusing on transportation, energy and tourism.