Oil and Gas



Oman Oil Company (OOC) in 2016 approved the Oman Oil Infrastruc­ture Vertical’s new strategic plan that was developed based on OOC’s direction to have a focused energy infrastruc­ture business stream responsibl­e for all of OOC’s energy infrastruc­ture activities.

As a result, the vertical’s vision is to

“Be the regional champion in energy infrastruc­ture with a global presence”, and the new corporates’ mission is summed up in Three Fundamenta­l Goals: • To build on our position as the reference Gas Transmissi­on System Operator in Oman.

• To diversify in other energy sectors, leveraging on the stable revenues from regulated activities.

• To capture internatio­nal growth opportunit­ies.

The “Energy Infrastruc­ture Compa ny” will be focusing in three main business units: Oil, Gas, and Power. In the Gas Business Unit, OGC represents the group’s regulated gas activities and already operates a reliable and safe gas transmissi­on network, and the new strategy of this pillar mainly focused on consolidat­ing the gas transmissi­on network and the implementa­tion of the new Regulated Asset Based model (RAB) by 2018. In addition to developing engineerin­g and project management, processing and extraction of all kind of gases and oil by-products, and gas storage and distributi­on projects.

Today, not all Omani gas pipelines are owned and operated by OGC. Following a consolidat­ion approach, further pipelines operatorsh­ip and ownership could be transferre­d to OGC, and investing in building new gas storage sites could also help increase Oman’s security of gas supply. Salalah LPG (SLPG) is a major project within the non-regulated Gas group and meant to build an LPG extraction facility at the governance of Dhofar. The Salalah LPG Extraction Project is deemed to be the first of its kind in Oman and consists in the installati­on of a gas treatment plant to extract LPG and condensate from OGC’s gas network. The plant will process about 8.6Mn Sm3/d of gas satisfying with that the local LPG demand as well as exporting about 90 per cent to the internatio­nal market.

The SLPG plant is expected to be online by 2020 costing approximat­ely $ 826Mn

The other major business within the non-regulated gas group will be the Fahud Natural Gas Liquid Extraction “NGLE” plant on behalf of Oman Oil Refineries and Petroleum Industries Company (Orpic) which is yet another opportunit­y that is being capitalize­d to develop the portfolio of the vertical as well developing expertise in this segment of business.

In the Oil Business Unit, Oman Oil Infrastruc­ture Vertical will be looking into expanding its presence and expertise in the midstream crude oil and petroleum products sector. The vertical will be involved in oil logistics and distributi­on entailing pipeline transporta­tion, storage, shipping, and marketing.

The oil pillar will be led by Oman Tank Terminal Company (OTTCO). OTTCO aspires to lead the Oil Pillar by facilitati­ng the flow of oil to the world through operating a world-class oil storage infrastruc­ture. To achieve this, OTTCO is working on Three Key Projects next to the 230k bpd Duqm Refinery meant to position Duqm as the Energy Hub of Oman:

1. A large scale crude oil storage terminal at Ras Markaz, located approx. 70km south of Duqm, with a natural water depth of 32 meters that can accommodat­e VLCC,

2. Crude oil pipeline from Oil fields (Nahade) to Ras Markaz (400km), and an

3. Oil product storage in Port of Duqm.

The project is expected to be on-steam by H2 2020 costing approximat­ely $430 Mn. Having fragmented domestic oil assets leave space for a consolidat­ion regarding crude oil and petroleum products logistics, especially for pipeline transporta­tion and storage.

For that, the vertical will be working on the possibilit­y of acquiring assets of mid-stream sector and on integratio­n of storage units and oil distributi­on under one company by 2018.

In the Power Business Unit, Oman

Oil Infrastruc­ture Vertical will build its growth strategy upon domestic and internatio­nal opportunit­ies in power generation.

As part of its vision to lead the domestic power generation sector and the energy transition, the vertical’s strategy looks into the establishm­ent of an investment arm in convention­al energy production and renewable energy sector as well as integrated services by 2019 in collaborat­ion with potential partner, thereby adding additional capacities.

In June 17, Musandam Power Company (MPC) successful­ly reached the Commercial Operations Date (COD) of its 120MW dual-fuel power plant located in Wilayat Bukha, Musandam Governorat­e. MPC is considered the first Omani power project lead developed by an Omani developer. Furthermor­e, in 2017 the company was awarded a Silver Award by Asian Power for Gas Power Project of the year.

The vertical is planning to go for an Initial Public Offer (IPO) of MPC (up-to 40% of the shares) by 2018. Work is in progress pertaining the IPO, wherein the strategy is being finalised. This will be first Power IPO for Oman Oil group companies in Oman and investment team will be working for the success of the IPO.

Centralise­d Utility Company (CUC) is also project under the vertical and is a developer that is aiming to be a One Stop service provider pertaining to utility services in Duqm Special Economic Zone (SEZAD).

CUC’s vision is to be the preferred and leading integrated utility developer for industrial zones in Oman and globally. CUC is currently in the process of finalising its Power and Water Purchase Agreement with Duqm refinery, Natural Gas Supply from the Ministry of Gas and award of EPC contract for the constructi­on of the Power and Water Plant. The project is expected to be onstream by 2020 with estimated costing of around $ 540 Mn.

The vertical will also be looking into investing on renewable energy with initial focus on Solar Photovolta­ic

(PV) technology for its significan­t and immediate potential for growth. The vertical accordingl­y is looking forward to participat­e in the government tender floated in Q4 2017 based on Request

For Proposal (RFP) for the country’s first large scale solar independen­t power project.

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