UPDATE 1-Qtel unit wins Oman fixed-line phone licence-sources

(Adds details, background)

MUSCAT, Nov 18 (Reuters) - Nawras, the Omani affiliate of Qatar Telecommunications Co QTEL.QA (Qtel), has won a licence to set up Oman's second fixed-line network, a source at Nawras told Reuters on Tuesday.

The award ends the monopoly of state-run Oman Telecommunications Co OTL.OM as the Gulf Arab state liberalises the sector as part of efforts to encourage foreign investment to counter falling oil production.

The source spoke on condition of anonymity because he is not authorised to discuss the issue with media.

Officials at the Telecommunications Regulatory Authority could not be reached, but a government source confirmed the report to Reuters.

Oman had shortlisted six bidders for the licence and an official had said the country of about 2.7 million people was looking for a company that could invest at least $300 million in the first five years of the contract. The sultanate has a fixed-line penetration of just 10 percent.

Omantel lost its mobile telephone monopoly when Nawras, which is 70 percent owned by Qtel, started operations in 2005.

Oman, which owns 70 percent of Omantel, invited investor interest in July for the sale of a 25 percent stake in the operator, which it hopes will further boost competitiveness.

States across the world's biggest oil-exporting region are opening up their telecom sectors as their economies boom and subscriptions grow. (Reporting by Saleh al-Shaibany; Writing by Firouz Sedarat; Editing by Erica Billingham)