Abstract In July 2004 a Northern Oman Carbonate reservoir asset team embarked on an Underbalanced Drilling (UBD) campaign after a detailed feasibility study. The main objectives of the UBD campaign were to improve the Productivity Index (PI) and test the validity of real time reservoir characterizations (RTRC) in UBD operations. To date 16 wells have been successfully drilled UBD resulting in almost double the PI and better initial well production with a decline trend better or comparable to the offset conventional wells in the area. Real time reservoir characterizations (RTRC) helped identifing the features contributing to water production and enabled real time decision making to optimize well path and sometimes extension of the well length by correlating real time resistivity data with real time production. RTRC also enabled optimum completion selection to maximize production as well as ESP sizing and installation of proper water shut off mechanisms (the preferred water shut off method is expandable Open Hole Clad "OHC"). Reservoir and geological models were updated in accordance with this analysis. Other benefits seen from the UBD campaign include eliminating the need for stimulation, TLC logging (i.e. MPLT, FMI, etc…) and curing losses while drilling the reservoir section along with technology maturation of improved Down Hole Isolation techniques and the running of the OHC in UB situation. A key success factor was the assimilation of a multidisciplinary integrated team comprising of the asset team, well engineering, new technology, drilling and UBD contractors. They all contributed to the success of UBD campaign which resulted in new oil delivery ahead of time and within budget. As a result of the high success of the UBD campaign in 2004/2005 the asset team decided to drill all its oil producers underbalanced. However, the challenges that have arisen are mainly in the cost of UBD packages and services as well as improving the reliability of some of the well control tools such Down Hole Isolation Valves (DHIV) and the application of contingencies in case of their failure.