MUSCAT, Jan 16
National Gas Company, a long-established Omani energy firm that markets and distributes liquefied petroleum gas (LPG) in Oman and other overseas markets, says it is weighing investments of around $100 million in a small-scale liquefied natural gas (LNG) plant to serve the low-carbon energy requirements of oil and gas rigs in the Sultanate of Oman.
For publicly traded National Gas, which is listed on the Muscat Stock Exchange (MSX), the move marks a further diversification of its business portfolio — currently focused on the bulk supply of LPG, among other energy solutions such as synthetic natural gas (SNG) systems — with the addition of LNG.
Once greenlighted for implementation, the proposed mini-LNG project would be the first investment of its kind in a sector currently dominated by large players, notably Oman LNG, Qalhat LNG and the under-development Marsa LNG schemes, each entailing billion-dollar-plus investments.
Muscat-based National Gas outlined its LNG investment strategy in an interview with The Energy Year, a UK-based international business news portal. Rachid Majjad, CEO, said the company has already signed an MoU with leading Omani drilling and well services company Abraj Energy Services to support its energy transition needs. The goal is to convert diesel generators at Abraj’s rig sites to a dual-fuel model using LNG. This retrofitting is expected to reduce CO₂ emissions by 30 per cent while cutting operating costs by 15 per cent.
“We plan to invest $100 million to build our own LNG production facility”, said Majjad. “It will source gas from (state-owned integrated energy group) OQ, liquefy it and distribute it to rig sites. Since rigs change locations, the regasification units, cryogenic tankers and associated equipment will all be mobile. Abraj, which controls around 50 per cent of Oman’s rig market, will be the anchor off-taker. Initially, we aim to supply 85 rigs”.
Final pricing approval is currently awaited from Integrated Gas Company (IGC), the wholly Omani state-owned natural gas aggregator and shipper. “If approved, we will start construction in Q1 2026, with a two-year execution window. LNG in Oman is primarily exported and not readily available for domestic use, so this investment fills a strategic gap”, he added.
When operational, the mini-LNG plant would enable — for the first time in Oman — the regular supply and distribution of LNG for domestic consumption. Loaded into insulated cryogenic road tankers, it can be transported over short or medium distances within the country for delivery directly to factories, industrial sites, power plants, remote communities and mining operations, among other users.
Production follows the same process applied in large-scale liquefaction plants. In both export LNG and domestic trucked LNG, the feedstock comes from upstream gas that is cooled to approximately –162°C. The difference is not the fuel itself, but the scale, logistics and purpose of the supply chain. Export LNG is stored in massive cryogenic tanks, loaded onto specialised LNG carriers, shipped over long distances and delivered to receiving regasification terminals before being piped into national grids.
For domestically trucked LNG, however, the cost-intensive storage, shipping and regasification elements of the export supply chain are not required. In many countries, trucked LNG is widely used to decarbonise industries located off the pipeline grid and as a reliable back-up fuel source.
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