Pact to extend operational life of 3,500 MW of Oman power assets

MUSCAT: Three major power companies in the Sultanate of Oman have secured new Power Purchase Agreements (PPAs) that will extend their operational lives for another 15 years upon the expiry of their current contracts with Nama Power and Water Procurement Company (Nama PWP) — the single buyer and procurer of electricity and desalinated water capacity.
Publicly traded Phoenix Power Company SAOG, Al Batinah Power SAOG, and Al Suwadi Power SAOG announced in regulatory filings on Tuesday, March 17, 2026, that they have received Letters of Award for new contracts covering a combined 3,500 MW of generation capacity. All three gas-fired Independent Power Projects (IPPs) began commercial operations between 2013 and 2014.
Phoenix Power, backed by AXIA Power as the anchor investor, operates one of Oman’s largest gas-fired IPPs, a 2,000 MW plant in Sur. Ahmed al Abri, Chief Financial Officer of Phoenix Power, said: “The new agreement will commence on April 1, 2029, immediately following the expiry of the current agreement and will remain in effect for 15 years, ending on March 31, 2044”.
Al Suwadi Power Company SAOG, backed by French global energy giant Engie, operates a 745 MW plant in Barka (Barka-3 IPP). Preetam Saraf, Company Secretary, noted: “Subject to the execution of the New PPA anticipated under the Letter of Agreement (LOA), the term of the New PPA is expected to commence on April 1, 2028, immediately following the expiry of the current agreement and will remain in force for 15 years until March 31, 2043 under mutually agreed commercial terms”.
Similarly, Al Batinah Power, also majority-owned by Engie, operates a 745 MW plant in Suhar. CEO Saud al Waili added that the new agreement will come into force on April 1, 2028 and “remain in force for 15 years until March 31, 2043”.
From Nama PWP’s perspective, the new PPAs help ensure reliable electricity supply in Oman by keeping well-performing plants operational as older units retire and new, particularly renewable, capacity comes online. The agreements also enhance cost efficiency through lower fuel consumption and competitive generation costs, support grid stability amidst rising renewable penetration and provide flexibility during the country’s energy transition.
Over the past couple of years, Nama PWP has pursued a dual-track strategy: granting new PPAs to ageing but still viable gas-fired plants while contracting new capacity for the future. In 2024, it signed agreements for legacy facilities including Barka 1 Power & Water Plant, Barka 2 Power & Water Plant, Al Rusail Power Plant and Manah Power Plant, covering over 1,500 MW for up to nine years, in some cases integrating both power and desalination output.
More recently, Nama PWP has signed new long-term agreements for two new gas-based projects: Misfah IPP (1,600 MW) and Duqm IPP (800 MW), which are intended to gradually replace older capacity while maintaining system balance during the transition.