MUSCAT, SEPT 30 – Oman Oil Duqm Development Company — a key vertical of the wholly government-owned Oman Oil Company (OOC) —has reported further headway in the implementation of a mega petrochemical complex downstream to Duqm Refinery currently under construction at the Special Economic Zone (SEZ) in Duqm. According to a high-level official, the petrochemicals complex — estimated to cost between $8 — $10 billion — is set to be the biggest industrial investment in the Sultanate, surpassing in scope and size the Liwa Plastics petrochemical scheme under development in Suhar.
“This will be the largest project in the country — even bigger than Duqm Refinery,” said Hilal bin Ali al Kharousi (pictured), Executive Managing Director of Oman Oil Duqm Development Company. “We will have a natural gas liquids (NGL) extraction plant in central Oman, connected via an NGL pipeline to a steam cracker in Duqm, similar to Liwa Plastics, except that the project size is far bigger.”
Speaking to the Observer, Al Kharousi said feasibility studies linked to the establishment of the petrochemicals complex have been completed with the company currently focused on the next steps for the implementation of the ambitious scheme.
“We are about to award a contract for the (Front End Engineering Design – FEED). Hopefully that will be done in a couple of weeks from now. The design will take about a year and a half to be completed, and then we will start the process of financing and so on.”
The petrochemicals complex, said the official, will produce a range of commodities, including Ethylene Glycols, High Density PE (HDPE), Oxo chemicals, Polypropylene, Butadiene, MTBE, and Aromatics. Some of these products will be produced for the first time in the Sultanate, effectively bolstering Oman’s credentials as a global-scale petrochemicals producer.
Feedstock for the petrochemicals complex include naphtha and LPG from Duqm Refinery, as well as natural gas liquids (NGLs) from government facilities, Al Kharousi said.
Significantly, Oman Oil Duqm Development Company is also making headway in the financing of the debt component of the $7-billion Duqm Refinery project. “We are almost closing the financing for the refinery. Hopefully by the next couple of weeks, the financing will be completed,” the executive managing director said.
Oman Oil Company and Kuwait Petroleum International (KPI) are 50:50 joint venture partners in Duqm Refinery and Petrochemicals LLC, which will own the refinery as well as the downstream petrochemicals complex.
Asked if Oman Oil Duqm Development Company is open to private investment in the petrochemicals complex, Al Kharousi stated: “At the moment, the same two shareholders — Oman Oil Company and Kuwait Petroleum International — are leading the projects. There are interested parties knocking on our doors. We welcome investors to come in. However, we would like to wait when the FEED is completed. By then, the partnership strategies will become crystal clear and we will understand who is serious and who is not, what are the terms and conditions, and so on.”