Oil and Gas
Gas Director Salim Al Sikaiti shares the critical importance of gas to the nation and the central role PDO plays in its development
WHAT ARE YOUR THOUGHTS ON PDO’S 40TH ANNIVERSARY OF GAS PRODUCTION?
I feel an immense source of pride that we have been able to overcome many challenges to continually deliver gas supplies for our customers at home and abroad. From an accidental discovery in 1962 when we were drilling for oil in Yibal to the opening of the Yibal
Gas Plant in 1978 and beyond, we have built a first-rate gas organisation which serves the nation reliably and efficiently. I thank and commend all those staff and contractors, both past and present, who have done so much to help us reach this impressive milestone.
WHAT ARE YOUR VIEWS ON THE ROLE PDO PLAYS IN OMAN’S GAS INDUSTRY?
PDO has been at the centre of the evolution of gas in the Sultanate and we are the country’s main supplier, initially supplying all the country’s gas requirements and currently providing 70% of the nation’s demand after BP’s Khazzan project came on stream. As well as meeting the needs of residential customers, helping to provide for example, electricity, clean water and cooking fuel, gas has fuelled the development of Oman’s industry, such as steel, aluminium and fertiliser manufacture and has generated revenue through the export of liquefied natural gas. All this expansion has been fuelled by gas and without PDO this would not have materialised.
WHAT IS THE FUTURE FOR GAS?
Gas will remain a key energy source, not just for Oman but the whole world, for a very long time. The growth in demand will continue and the focus to discover more and optimise production will remain. Right now, we are trying to maximise the usage of the molecules of gas. At present, we burn it to produce electricity, use it as a raw material and freeze it for export. However, the Government is also looking at integrated solutions when it comes to gas development – not just upstream but what we do with it downstream - so we have full utilisation of the value chain. So, for example, you could convert it to GTL (Gas to Liquid) which can generate more value and create more jobs. Secondly, when you look at our supply and demand line, the demand line is increasing. A lot of this is to do with the growth of the population and industrial expansion (such as Duqm). Although gas is the cleanest form of fossil fuel energy, burning it to produce power is not maximising the value of gas and is not sustainable for Oman, so that is why we are looking at renewables. There is a lot of focus on producing solar and wind energy and it is estimated 15% of our power requirements will becoming from renewables by 2030, with some saying that figure could go as high as 30%. That will enable us to re-direct gas to more value-adding industrial usage. The demand for gas will increase and it’s a very exciting time as we seek new ways of ensuring we maintain the supply. With the recent discoveries we have seen, such as Mabrouk North East, the picture looks very promising, but we also need to optimise our use while seeking alternative energy sources.
Gas will remain a key energy source, not just for Oman but the whole world, for a very long time. The growth in demand will continue and the focus to discover more and optimise production will remain. Right now, we are trying to maximise the usage of the molecules of gas. At present, we burn it to produce electricity, use it as a raw material and freeze it for export. However, the Government is also looking at integrated solutions when it comes to gas development – not just upstream but what we do with it downstream - so we have full utilisation of the value chain
WHAT ABOUT GAS CONSERVATION?
Our Gas Conservation Strategy focuses on initiatives to reduce gas demand, cut flaring as well as research alternatives for gas and energy supply. A number of initiatives have been implemented, including the use of energy efficient power generation turbines and waste heat recovery systems for thermal operations. In addition, we have cut losses in our power distribution, achieved improvements in artificial lift adoption, introduced gas breakthrough controllers and reduced water treatment and separation energy requirements.
Let’s also not forget our flagship Miraah solar project, being developed with partners GlassPoint Solar, which will save a huge amount of natural gas a year, enough to provide residential electricity to thousands of Omanis. On the flare reduction side, a lot of efforts have been put in, resulting in a reduction of about 40% in Gas Directorate flaring between 2014 and 2018. We also have plans in place to reduce continuous flaring in our facilities way before the World Bank deadline of 2030.
HOW IMPORTANT ARE PDO’S GAS DEPLETION COMPRESSION PROJECTS?
They are key to our sustainability. We 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. Our facilities have grown like monsters! For example, the Government Gas Plant at Yibal has grown 10 times since1978 throughout the three phases of depletion compression. There has also been a huge expansion of the Central Processing Plant at Saih Rawl during the second phase, where we are constructing four parallel compression systems, installing 76MW of gas capacity and a pair of inlet separators, and modifying the condensate handling system, all with a view to producing 30 million cubic metres of gas per day. The Saih Nihayda Gas Plant has seen a similar expansion that will make it a fully independent station thus providing more flexibility and reliability to our gas network.
WHAT CAN WE LOOK FORWARD TO ON THE PROJECT FRONT?
The Rabab Harweel integrated project will produce 80% gas and 20% oil. The first gas is due next year and we will be looking to produce 15 million cubic metres per day. Some will be re-injected to maximise condensate recovery, some will be used to produce more oil and some will be sweetened (hydrogen sulphide and carbon dioxide removed) for export.
We are expecting the first gas from Yibal Khuff in 2021, some six million cubic metres per day (a combination of associated and non-associated gas). About 10-15 years ago, we had a gas deficit in PDO, but once we have Yibal Khuff on stream the oil side will be self-sufficient from a gas supply point of view (with the exception of gas injection in the Harweel area). The Mabrouk area is also very promising and we have been very aggressive there in terms of exploration and development. We are commencing Phase 3 of the Mabrouk main development, taking us from seven million cubic metres per day to over 11 million cubic metres per day.
ANY FINAL THOUGHTS?
The gas business is very critical for Oman and demands very high availability. Gas represents a whole value chain of carbon – LNG, methane, butane, propane, for example – and we underestimate its importance. There are ships coming into the Oman LNG Plant at Sur every other day. Just over a third of our gas is exported earning much needed revenue for the Sultanate and if we miss one shipment, you would soon see how much disruption it would cause, both for the Government and our export customers. It’s a very important part of what PDO does and I feel privileged to be working with the team I have who deliver day in, day out.
They are key to our sustainability. We 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. Our facilities have grown like monsters! For example, the Government Gas Plant at Yibal has grown 10 times since1978 throughout the three phases of depletion compression.