US firm PetroTel has signed a three-year exploration and production sharing agreement with the Sultanate of Oman, a senior government official said on Sunday.

The Texas-based company will be developing Block 17 in the north of the Gulf state, Nasser Al Jashmi, state undersecretary for oil and gas told Reuters.

"The 2,378 square kilometre block in Musandam will be operated by Petro to help Oman increase its hydrocarbon output," he said.

This is the fourth deal which the non-Opec producer has signed with foreign companies to develop and explore for oil and gas as it seeks to boost production, Al Jashmi said.

Other international companies that have signed production-agreements with Oman this year include, Canada's Epsilon Energy Limited, US listed Harvest Natural Resources and Malaysia's Petronas.

"We hope to sign other such deals this year," Al Jashmi said.

Oman's oil output in the first-quarter of 2009 rose 6.1 percent on the year to 786,700 barrels per day (bpd), official data showed.
   
Oman's oil price forms part of the benchmarks used in pricing the 12 million barrels of crude exported from the Middle East to Asia daily.

Oman is targeting output crude and condensate at around 805,000 bpd in 2009. - Reuters