09 - 11 MARCH 2020

Oman Convention & Exhibition Centre, Muscat, Oman

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Industry News

A string of 'strategic growth projects' currently under various stages of implementation at a combined cost of around $26 billion will help sustain Oman's economic diversification, according to the Under-Secretary of the Ministry of Oil & Gas (MOG).

Salim bin Nasser al Aufi said the mega schemes - related to Oil & Gas, refinery and petrochemical investments - will position the Sultanate as a strong player in the energy sector, as well as boost local value creation and employment generation.

"Strategic projects and economic diversification plans in Oman are key," said the Under-Secretary. "Their aim is to make a significant contribution to sustainable development through which the MOG seeks to attract promising investment opportunities, expand investments and work with partners to capitalise on technical expertise in order to help boost local production and create jobs which have so far reached some 6,000 positions," he noted.

Speaking at the Annual Media Briefing hosted by the ministry last Wednesday, Al Aufi listed a number of upstream Oil & Gas developments that are critical to sustaining hydrocarbon output over the long-term.

Notable is the Rabab Harweel Integrated Project (RHIP), being implemented by Petroleum Development Oman (PDO) with an investment of $4.7 billion. Billed as one of the largest Oil & Gas schemes in the Sultanate in terms of capital costs, the integrated project will produce gas and condensates from the Rabab field and oil from the Harweel field using miscible gas injection. The giant scheme is expected to come on stream in June this year.

Equally strategic is PDO's Yibal Khuff project, which is being constructed with an investment of around $2.9 billion. Termed as the "most technically complicated project" in the Sultanate, the Yibal Khuff venture is designed to harness the acid oil and gas potential of the Khuff and Sudair reservoirs. The project is slated to come into operation in early 2021.

In the south of the Sultanate, PDO recently brought into operation its Tayseer acid gas field, which was discovered in late 2014. A preliminary processing plant at site processes hydrocarbons which contain 4 per cent hydrogen sulphate gas, producing 35 million cubic feet of gas and 4,400 barrels of condensate per day. Total investment in the venture was $350 million.

Ghazeer - representing Phase 2 of BP's tight-gas development in Block 61 - is also making headway in its implementation. Work on a new gas processing plant is now well past the midway point. The project will add a further 0.5 billion cubic feet per of gas when the Ghazeer field commences production in early 2021.

Work on a sizeable portfolio of refining and petrochemical projects is also being progressed in Suhar, Duqm and Salalah. Oman Oil & Orpic Group is executing the Salalah Liquefied Petroleum Gas Project at a cost of $826 million. When completed in the third quarter of 2020, the plant will generate revenues of around $200 million annually through the sale of LPG and condensates.

Liwa Plastic Industries Complex (LPIC), another mammoth petchem scheme under construction at Sohar Port at a cost of $6.7 billion, will contribution to the production of polyethylene - a class of plastics that enjoys growing global demand. The project will be ready in Q2 2020.

(Source: www.omanobserver.om)

In tune with its plan to increase spending to boost growth, Oman is planning to invest around RO2.2bn in 2019 in oil and gas production and exploration activities, nearly six per cent higher than the last year, according to this year's budget.

Oil and gas production expenditure is estimated at RO2.2bn in the 2019 budget, said a statement issued by the Ministry of Finance on Tuesday.

'This includes the operational and capital costs of oil and gas production, and expenses required to maintain future oil and gas production as well as enhance oil and gas reserves', the budget statement said.

In the previous year's budget, the government had announced that it allocated around RO2.1bn, around 15 per cent higher than the 2017, for the hydrocarbon, which remains very crucial for a country like Oman. In 2017, the government had allocated around RO1.82bn for the sector.

According to senior officials from the oil and gas ministry, Oman remains one of the few countries across the world who had never scaled back funds allocated for the hydrocarbon sector despite suffering heavily from the sudden fall in global crude prices over the past few years.

While increasing the fund allocation for the oil and gas sector, the budget statement also said that the government will emphasis more on improving efficiency of the sector.

The budget statement said that the government will try to rationalise spending by 'raising the efficiency of spending on oil and gas production, by using the latest methods' of production.

(Source: www.omanoilandgas.com)