$6bn Duqm refinery development to kick off soon
Muscat, June 19, 2014
The process of pre-qualifying international companies for the multibillion dollar engineering, procurement and construction (EPC) package of the Duqm Refinery project in Oman is expected to be kicked off in the third quarter of this year, said a report.
Duqm Refinery and Petrochemical Industries Company, a joint venture of Oman Oil Company (50 per cent) and International Petroleum Investment Company (50 per cent), a wholly owned commercial entity of the government of Abu Dhabi, is jointly developing the refinery project with an investment of around $6 billion, said the Oman Observer report.
Plans for an associated petrochemical complex in the second phase could add a further $9 billion to the total project cost, it said quoting experts.
In the first phase, Duqm focused on developing a 230,000 barrels per day (bpd) grassroots merchant export refinery within the Duqm Special Economic Zone (SEZ) on the Wusta coast.
Designed as a full conversion refinery, the plant will utilise delayed coking technology for bottom of the barrel processing. It will also incorporate licensed technologies for hyrocracking, hydrotreating, LPG treatment, kerosene treatment and sulphur recovery.
Other key entities assisting Duqm in the development of the project are Allen & Overy, as legal advisor, and Credit Agricole-CIB as financial advisors. The technology licensor is set to be announced soon, said the report.
The company will appoint a civil contractor to ready the site allocated by the Duqm SEZ Authority for the refinery and petrochemical company. The contract award is expected in the first quarter of next year, with completion slated in 12 months.
An invitation to bid (ITB) for the key EPC package is expected to be floated in Q2 next year, with a contract award within the second quarter of 2016. The plant commissioning is likely to be towards the end of 2018 with operations ramped up to the plant’s full capacity before the end of 2019, it said.
Government-led entities have been signed on to provide support services during the operational phase, with Oman Gas Company laying a pipeline to supply natural gas for the utilities to operate the plant from Saih Nihayda in central Oman to Duqm SEZ.
Central Utilities Company (CUC), a partnership of Takamul (which is a subsidiary of Oman Oil Company) and Sembcorp Utilities, will develop and operate Seawater Intake facilities indispensable to the safe and efficient operation of the refinery.
The Duqm Petroleum Terminal Company (DPTC), a partnership of Oman Oil Company and Port of Duqm Company, will invest in the development and operation of a Liquid Jetty to handle ships bringing in crude for processing and carrying refined fuels and petrochemicals for export markets.
The Special Economic Zone Authority of Duqm (Sezad) plans to invest in support infrastructure, such as an important link road leading to the refinery site, drainage facilities, and coastal protection works.