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BP eyes launch of $1billion acetic acid project in Oman in 2023-24


MUSCAT, NOV 1 - Energy major BP says it is in discussion with the Omani government, its energy investment arm Oman Oil Company (OOC) as well as a potential partner, to press ahead with the implementation of its world-scale acetic acid plant in Duqm — a project involving an investment of around $1 billion. The revelation was made by Yousuf al Ojaili (pictured), President — BP Oman, at a panel discussion of chief executive officers of major Oman-based producers held as part of the OPAL Oil & Gas Conference 2017 on Tuesday. Salim bin Nasser al Aufi, Under-Secretary of the Ministry of Oil & Gas, was the Chief Guest at the event.

The proposed Duqm Acetic Acid project, first unveiled in 2013, envisions a large-scale greenfield, petrochemical scheme based on BP’s proprietary SaaBre technology.

A Memorandum of Understanding (MoU) was signed with the Ministry of Oil & Gas, to this effect at the time. Oman Oil Company, which is a 50 per cent equity partner in the $7 billion Duqm Refinery project, is also expected to play a key role in the venture.

“We hope to put (the project) on stream by 2023-24 in line with the petrochemical developments of Duqm Refinery. It is still in the feasibility stage,” Al Ojaili said, adding that BP recently “had a discussion with a partner — and the government — that has shown interest in developing this project further”.

Billed as a fundamental building block of the petrochemical industry, acetic acid is used as a raw material in the production of a wide array of petrochemicals that serve as intermediaries in the manufacture of adhesives, paints and solvents, as well as the production of purified terephthalic acid (PTA), one of the most common polymers at the source of the multiple forms of polyesters.

The plant is also expected to spawn investments in a wide range of downstream petrochemical ventures while also creating synergies with petrochemical investments planned by Oman Oil Company downstream of the Duqm Refinery mega project.

“The good thing about this project is that it can contribute to a local downstream derivatives industry that can be established in the Duqm area,” Al Ojaili said, noting that natural gas required as feedstock for the main project will “not be big” and will be equivalent, at best, to that of a fertiliser or methanol plant.

Significantly, the proposed acetic acid project is one of two major downstream petrochemical ventures supported by BP in the Sultanate, said BP Oman’s President. “We have an agreement with Oman Oil Company for the Ompet PTA project to provide the licensing technology for the project. Hopefully we will see a (Final Investment Decision) from Oman Oil. This is their own project, while we will be providing the technology.”

In 2015, BP and Oman International Petrochemical Industries Company (Ompet) — part of Oman Oil Company — had signed a licence agreement for supply of BP proprietary technology for a proposed 1.1 million tonnes per annum (tpa) capacity PTA project in Suhar. PTA is a key ingredient in the manufacture of polyesters for textiles and packaging materials.

As part of its commitment to the project, BP has agreed to provide a wide range of technical and knowledge transfer services as well as assist Omani staff within the Ompet joint venture. The front-end engineering design (FEED) package for the licence had been completed and delivered to Ompet on schedule, company officials said at the time.

BP’s PTA technology is cited as have the potential to significantly lower capital and operating costs when compared with conventional PTA plants. The technology is also more energy efficient, uses less water, and produces less solid waste.

Commenting on its flagship investment – the Block 61 tight gas development – Al Ojaili said Phase 2 of the giant scheme – dubbed ‘Ghazeer’ – is in the appraisal phase. “We are getting ready to take a Final Investment Decision (FID) together with our partner (Oman Oil Company Exploration & Production – OOCEP) and the government, in early 2018 and aim to put first gas into the network by 2020-21, along with associate condensate volumes.”

Conrad Prabhu

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