Oman Oil Duqm Development Company, one of the verticals of the wholly government owned strategic investment group Oman Oil Company, has unveiled plans for the establishment of a mammoth petrochemicals complex at the Duqm Special Economic Zone (SEZ), featuring as many as 10 large-scale plants and involving several billions of dollars in investment.
An overview of the scope and strategic nature of this initiative was presented by a top official of the Duqm-focused vertical at the 2nd Oman Downstream Exhibition & Conference (ODEC) which opened at the new Oman Convention & Exhibition Centre here.
Hilal al Kharusi (pictured), Executive Managing Director, said a dedicated zone earmarked for the sprawling development will host 10 plants producing over 20 products ranging from commodities to specialty products, paving the way for over 30 chemical processing businesses to be set up further downstream of the value chain.
The centrepiece of the ambitious development is the Duqm Refinery, a green-field refinery with a capacity to process 230,000 barrels per day (bpd) of domestic and export crude. Oman Oil Company (OOC) and Kuwait Petroleum Corporation are the 50:50 equity joint venture partners in the estimated $6 billion refinery venture. A formal partnership agreement will be signed here in Muscat on April 10, 2017.
“We are starting with a refinery of 230,000 bpd capacity, with the potential for further expansion, featuring the latest technologies and designed to provide feedstock for world-scale petrochemicals plants that will leverage Oman Oil’s experience, and that of our partners as well,” said Al Kharusi.
“This is the first major cross-country refinery and petrochemical investment in the GCC. It is also the first GCC refinery that will import and export crude and petrochemicals,” he added. The mega development, the Executive Managing Director pointed out, will complement Oman Oil Company’s equally large refining and petrochemicals ventures in Sohar, Sur and Salalah. These investments in the free zones of the country currently produce as many as 15 different types of commodities, including methanol, ammonia, urea, aromatics, paraxylene and polypropylene, which are presently exported to scores of countries around the world.
According to the executive, Oman Oil’s expanding portfolio of products can also be harnessed to fuel the growth of a flourishing downstream sector in the Sultanate. Two-thirds of the estimated $6 billion in value addition created annually as a result of oil and gas processing in the Sultanate is derived from petrochemicals, he noted.
Additionally, the Duqm refining and petrochemicals scheme has the potential to create an estimated 2,500 direct jobs and around 6,300 indirect employment opportunities. Prospects are equally immense for downstream businesses, logistics and support infrastructure, service providers and other assorted activities, al Kharousi said.
Locating the giant scheme in the SEZ at Duqm is pivotal to the overall success of the venture, he stressed. “The Duqm SEZ is one of the largest free zones in the region and a major hub for refining, petrochemicals and other industries. It’s a fully integrity city spanning over 2000 km with 8000 hectares earmarked for heavy industries, and offering world-class infrastructure to support refining and petrochemical investments.”
These features will enable Oman Oil Company to build an upstream and downstream portfolio with a focus on high value, high-end downstream industries, the official stated.