DMEA: Duqm petchem study to be completed in 2025

A feasibility study for the construction of the Duqm petrochemical complex – located in Oman’s Duqm Special Economic Zone (SEZ) – is now expected to be completed in 2025, according to comments made during an interview with ICIS by OQ’s vice president for business development Sultan Al Burtamani.

The facility is slated to be developed as a joint venture (JV) between petrochemicals major Saudi Arabia Basic Industries Co. (SABIC), Kuwait Petroleum International (KPI) and OQ.

During the interview, Al Burtamani noted that Oman was aiming to “maximise the value of hydrocarbons” within its borders and highlighted that OQ was currently “studying this project together with [its] other partners”. He continued: “Hopefully in the coming months we’ll get clarity on how we will be moving the project to the next stage”.

Development of the petrochemical complex follows the recent completion of the 230,000 barrels per day (bpd) OQ8 Duqm refinery, which cost $9bn to construct. It is currently run as a JV between OQ and KPI and is expected to provide feedstock to the new petrochemical plant when construction work on that project is complete.

Similarly to its neighbours, Oman is looking to diversify away from oil and gas production with increasingly stringent regulations and requirements coming into play for the industry as the world continues to progress with energy transition measaures. Oil and gas currently make up for over half of Oman's GDP but the next most profitable option remains petrochemicals.

Regarding this, Al Burtamani noted: “We are studying what could make a commercial competitiveness for us in the petrochemical space, [perhaps] related to the cracker business, that we are thinking of expanding”. He added: “We are trying to develop Duqm as another industrial hub, which is what we did in (the port cities of) Sohar, Sur, and Salalah (in Dhofar)”.

He concluded that Duqm was an attractive location due to its location facing the Indian Ocean – an area in which numerous important shipping routes are located.

Earlier this year, CEO of Kuwait Petroleum Co. (KPC) Nawaf al Saud – along with members of the company’s board – reviewed a report from the Duqm petrochemical complex’s study and issued directives to enhance coordination between Kuwaiti and Omani partners to speed up the approval process and remove any obstacles that could prevent the project from being implemented in a timely manner. This was in response to the primary factor mentioned in the report – which was the need for increased urgency to ensure the project’s success.

Additional mentions in the report included references to ongoing discussions around increasing the refinery’s production capacity by 10-15% over the coming year. This would include increasing the plant’s output from 230,000 barrels per day to 260,000 bpd, while upgrading its oil processing units and exploration waste conversion technologies – designed to improve efficiency and product diversity.

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