Occidental Petroleum Corporation (Oxy) and Mubadala Development Company of Abu Dhabi (Mubadala) will jointly develop four existing gas fields and explore for potential new discoveries in a newly-formed contract area in Northern Oman.

The companies have signed an exploration and production sharing agreement (EPSA) with the ministry of oil and gas in the Sultanate of Oman in this regard, said a Gulf News report. 

The 20-year agreement covers a 2,269 square kilometre area.

Oxy will serve as operator under the EPSA and hold a 48 per cent interest, with Mubadala holding a 32 per cent interest and the Oman Oil Company holding the remaining 20 per cent.

The development of the substantial natural gas resources contained within the contract area will create significant value for the people of Oman and for our shareholders,' said Ray Irani, chairman and CEO of Oxy.

The production from the area is expected to begin in 2010, the report said.