Oil major BP and its partners Oman Oil have agreed to develop a second phase of the Khazzan natural gas field bringing investment in the project to an estimated $16billlion.
The agreement with the government Oman is also expected to bring more than 1,000 square kilometres to the original 2,700 square kilometre block.
BP said the project is expected to deliver gas in late 2017.
Meanwhile, the second phase is expected to come on stream in 2020, and together they are expected to produce 1.5billion cubic feet of gas per day.
BP is the operator of the block with a 60% interest while Oman Oil holds the other 40%.