BRIGHT PROSPECTS

As PDO’s Gas Directorate celebrates 40 years of uninterrupted supplies of natural gas this year, Ibrahim Hamood Salim Al Waili, Gas Planning and Economics Manager, talks to Oommen John P on the milestone achievements and plans for the future

CAN YOU SHARE DETAILS OF KEY MILESTONES AND PDO’S CONTRIBUTION TO OMAN’S GAS PRODUCTION SINCE 1978?

To start with, gas was discovered in Oman before oil. Not many people know this fact. One of the exploration gas wells in the giant Yibal gas field was drilled in the year 1962 but this could not be developed on a commercial scale for a number of years. His Majesty Sultan Qaboos inaugurated the Government Gas Plant at Yibal on October 29, 1978, marking the official beginning of the Sultanate’s gas industry. So we can rightly say that the year 1978 was a milestone as the business of gas commenced in the country.

Initially, the gas production level was below five million metric cubic metres a day. From 1989 to 1991, large non-associated natural gas fields were discovered in central Oman. Saih Rawl was the biggest discovery in the central part of Oman in the 1990s. That discovery opened a new era for the gas industry in Oman. And then we decided to build a central processing plant at Saih Rawl, which is one of the biggest projects in the country.

Oman LNG, the first liquefied natural gas (LNG) project of Oman in Sur was set up to manage and operate the “downstream” of Oman’s gas operations, involving mainly the liquefaction, transportation and respective sales of the produced LNG. After that, PDO discovered other gas fields in Oman, and the gas production rose from 5 million cubic metres per day to 50 m3 over a period of 15 years. In 2007, another landmark was reached when the Kauther gas plant was brought on stream. As we move ahead, there is a feeling that we discover a giant gas field every five years. Lately, we discovered Mabrouk North East, which is our second biggest field after Saih Rawl and sets up a bright future for gas supply for the next 20 years or so. PDO has a dedicated

Gas Exploration department and it will continue discovering new gas fields.

Until September 2017, PDO contributed more than 95 per cent of the country’s gas supply. BP came on stream in 2007, but PDO is still the dominant supplier.

HOW HAS TECHNOLOGY BEEN USED TO HELP GAS PRODUCTION?

This year, PDO’s Gas Directorate celebrates 40 years of uninterrupted supplies of natural gas. Over the past four decades of gas industry, there have been lots of technology-driven breakthroughs. And it all started with the Yibal field, which was relatively simple to start with. However, our work has become more complex as we tap into deeper, tighter, unconventional finds. The reservoir at Khulud is a good example of where we have used hydraulic fracturing (fracking) to extract gas from tight rock formations. We also have several initiatives to sustain gas flows from reservoirs that have been in production for a number of years and have suffered a drop in reservoir pressure, such as depletion compression. Technology is evolving. The other side of the coin is reducing the gas consumption in our operations so it can be used for other value-adding sectors of our economy. In this respect, renewable energy is a key focus for the future. Waste-to-energy, solar, wind and others are all on our radar as we evolve to a fully fledged energy company. There are a number of things to improve sustainability of gas production and utilise other sources for power generation.

PDO’S SUPPORT TO SMEs…

PDO has been a champion of local SMEs through our In-Country Value strategy to ensure more of the wealth of the oil and gas industry stays in Oman. Across the whole value chain in gas and beyond, we are working hard to build up Omani businesses and diversify the economy. A thriving SME community is vital for the Sultanate’s sustainable economic development and we ring-fence our contracts to ensure a scope of work for local companies so they can build up their skills and expertise. Of course, the gas we produce fuels our economy so we need to continue our record of robust and reliable delivery.

WHAT IS THE CURRENT STATUS ON ENERGY TRANSFORMATION?

PDO will not lose its focus on energy. We have come a long way through our focus on upstream oil and gas, but climate change realities and the need to reduce our dependency on fossil fuels mean we need to evolve into a fully fledged energy company, with a focus on renewables and leveraging our services and expertise. Of course, oil and gas will remain our core business for years to come but we need to start making the transition now.. Looking at the future prospects, we truly believe that we have a bright future ahead of us in the gas industry. But it’s full of challenges. And we need to maintain focus and stay the course and build on our achievements. The future is bright. We have confidence of discovering more gas. Some of it will be easy to extract and some of it may be difficult. But we see a big market for gas as an increasingly valuable source of affordable and low-carbon energy.

PDO’S FOCUS ON HUMAN RESOURCES AND USE OF NEW TECHNOLOGIES?

New technology is always an enabler and it will continue to be so as we enter the Fourth Industrial Revolution. PDO has devoted a lot of time, manpower and money to invest in new technologies to ensure safe, efficient, responsible exploration and production. We currently have more than 90 new technologies at various stages of maturation from trial to deployment and we have a success rate of more than 90%. In concrete terms, let’s look at the Yibal station which was commissioned in 1978. It is still working, 40 years down the line because we have introduced new technologies and invested in reliability and integrity. The Yibal station was built for 25 years, but due to significant investments in new technologies, it is still running.

Of course, our people remain our key asset. The company always tries to ensure that people enhance their knowledge and develop their skills while working with us. In the Gas Directorate, and across PDO, we are always attracting and fostering top quality staff who are all committed to giving

PDO’s Gas Directorate celebrates 40 years of uninterrupted supplies of natural gas, this year. Over the past four decades of gas industry, there have been lots of technology-driven breakthroughs. And it all started with the Yibal field, which was relatively simple to start with. However, our work has become more complex as we tap into deeper, tighter, unconventional finds

their best for Oman. We have always produced top quality people. We have around 700 excellent people working in the Gas Directorate alone, as well as thousands of contractor personnel.

ARE FOREIGN INVESTORS KEEN ON INVESTMENT IN THE GAS SECTOR?

Foreign investors are already present in the country and some have deals already. Others are now making a beeline to invest in the gas sector. What we need to do is to be an enabler for investors and free zones like Duqm, Salalah, Sur and Nizwa, are attracting them, and will continue to do so.

Forty per cent of the gas from Oman is exported and the rest is consumed locally. Investors are here from around the globe. China is looking at building factories in Duqm. The Europeans are there too and the US, Iran and India are also keen to invest. While some are in the final stages of expressing a commercial interest, some have signed Memorandums of Understanding.

WHAT ARE THE KEY PROJECTS YOU HAVE PLANNED IN THE FUTURE?

A lot of major projects are happening in PDO. We are spending a lot of money in gas. We have developed projects that will not only maintain gas production but also increase our value. The Rabab Harweel integrated project is PDO’s biggest-ever project and 8,000 people from PDO and our contractors are working on it. It will be on-stream next year and represents the biggest reserve add in our history. Eighty per cent of what it will produce is gas. The other mega project is Yibal Khuff, the most complex we have ever undertaken. It will be completed in three years’ time and will be another significant contributor to the nation’s oil and gas production.

A lot of major projects are happening in PDO. We are spending a lot of money in gas. We have developed projects that will not only maintain gas production but also increase our value. The Rabab Harweel integrated project is PDO’s biggest-ever project and 8,000 people from PDO and our contractors are working on it