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Oman Business News

FEED award for $8bn Duqm petchem project soon

An award is due to be announced shortly for the Front End Engineering Design (FEED) of a giant petrochemical complex planned for implementation downstream of the Duqm Refinery project in Oman’s Al Wusta Governorate, according to a key project official. Dr Salim Saif al Huthaili, CEO of Duqm Refinery & Petrochemical Industries Company LLC (DRPIC), said the FEED package — marking a key phase in the implementation of the ambitious project — will be awarded as soon as the company secures the concurrence of its principal shareholders represented by Oman Oil & Orpic Group and Kuwait Petroleum International.

“We are in the final stages of reviewing the final scope of the project before we proceed with the FEED,” said Dr Al Huthaili. “We are almost ready to award it, but final approval from the shareholders both from the Omani and Kuwaiti sides is pending.” The mammoth complex, which promises to entrench Oman’s reputation as a global petrochemicals heavyweight, will further anchor Duqm’s transformation into a maritime and industrial hub, while powering Oman’s socioeconomic development well in the future. Speaking at a media briefing hosted by the Ministry of Oil and Gas recently, Dr Al Huthaili said the capital cost of the petrochemical complex will surpass the estimated $7 billion investment in Duqm Refinery, underscoring the
world-scale size of the petchem project.

“In terms of the projected investment and capital spend, we are expecting it to be between $8 billion and north of $8 billion. We are probably looking at one of the world’s biggest petrochemical crackers in the magnitude of something like 1.6 million tonnes of ethylene production per year, besides propylene and other molecules, and downstream activities as well.” Giving a tentative timeline for the implementation of the mammoth scheme, the CEO stated: “Once the (FEED package is awarded), we expect it to take about 18 months before a (Final Investment Decision) on the project is taken to move forward with the construction.

Typically, with a mega project like this, construction takes about four years — so 2025-26 is the expected timeline for delivering the project.” Construction work on Duqm Refinery itself — one of several mega developments that promise to anchor Duqm’s growth into an economic dynamo — is progressing per schedule, said Dr Al Huthaili. “This is a very interesting project for Oman, and an anchor project as well. In fact, after achieving financial close at the end of last year, HE Yahya al Jabri (Chairman of the SEZ Authority of Duqm), was saying that the amount of investment coming to Duqm has been immense. So this project is sparking a lot of interest in Duqm.”

As a world-class grassroots refinery based on advanced technology, the 230,000 barrels per day capacity Duqm Refinery will produce an array of clean products that comply with global standards for quality and safety. The refinery will also bolster the energy industry of Oman by strengthening the supply and production of Diesel, Jet fuel, Naphtha, LPG, Sulfur and Pet coke as its primary products.
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