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Oman turns to coal for power

Muscat, August 18, 2008

Oman plans to build coal-fired power plants to beat a shortage of gas to fuel future projects for economic diversification, an Oil and Gas Ministry official said on Monday.

The Gulf is the world's biggest oil exporting region, but has been slow to develop massive gas reserves. Rapid economic growth has absorbed fuel supplies and left all the countries in the region except Qatar short of gas.

"It makes a lot of sense to build coal-fired power plants as an alternative to gas since we don't have enough gas to fuel all of our future projects," Zaid Al Siyabi, director general of exploration at the ministry, told Reuters.

"This is the future. Coal is cheaper to import and at the same time we can use our gas for other purposes like the export of LNG," he added.

Faced with spiralling power demand, regional governments are considering alternatives to gas to generate electricity, such as nuclear and coal plants. Oman's neighbour the United Arab Emirates became the first Gulf country to move ahead with plans for a coal plant last month.

Oman exports nearly 10 million tons of liquefied natural gas (LNG) per year from four trains, but has struggled to meet its LNG contract commitments as domestic demand rises. LNG is gas chilled to liquid form for export on specially-designed tankers.

Oman wants foreign investors to build its first 1,000 megawatt coal-fired plants at Duqm, where the sultanate is developing an industrial zone. - Reuters




Tags: Oman | Gulf | coal |

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