Wednesday 22 September 2021

Oman Oil targets capex of over $1bn in 2017

MUSCAT, February 1, 2017

State-run Oman Oil Company (OOC) is planning a capital investment in excess of $1 billion across its subsidiaries this year, a report said.

Capital investments are being weighed by the Group across the four verticals into which its diverse subsidiaries have been grouped, OOC’s chief executive officer, Isam Saud al Zadjali was quoted as saying in the Oman Observer report.

Among the first ventures to advance will be the LPG Extraction Project of Salalah LPG (SLPG), a wholly owned subsidiary of Oman Oil Facilities Development Company LLC (OOFDC), one of the four verticals of the Group, the report said.

UK-based international oil services contractor Petrofac has been awarded a contract to construct the 327,000 tonnes per year capacity plant at the Salalah Free Zone at a cost of around $600 million.

“The Salalah LPG project has been approved by the Board, and we are negotiating with the banks right now on a financial close in the next few weeks,” Al Zadjali said.

Next off the blocks is a 1,000 metric tonnes per day capacity ammonia plant, also planned in the free zone alongside the Group’s wholly owned subsidiary Salalah Methanol Company.

Besides being used as an ingredient in the production of fertilisers, ammonia is also an important intermediate chemical in the manufacture of synthetic resins (urea based), synthetic fibres (acrylics and nylons, and polyurethanes, among other applications.

“We are going to make a recommendation to our Board on the implementation of the ammonia project, which is an expansion of Salalah Methanol,” Al Zadjali noted.

Several gas infrastructure projects are expected to progress during the course of 2017, according to the official.

Most notable is the much-anticipated gas pipeline supplying natural gas from Saih Nihayda in central Oman to Duqm Special Economic Zone. Also in the works, said Al Zadjali, is a ‘Northern Pipeline’ linking Sohar with Wadi Jizzi.

A world-scale crude oil storage park planned at Ras Markaz, just south of the Duqm SEZ, is also planned to make headway this year, according to the CEO.

The facility will also double as a second crude export terminal for the Sultanate, after Mina Al Fahal in Muscat, the report said.

Tags: Oman oil | OOC | capital expenditure |

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