Canadian firm wins Salalah ammonia plant deal

07 March 2017

Estimated $660m plant to produce 1,000 tonnes a day of ammonia

Canadian engineering firm SNC-Lavalin has been awarded an engineering, procurement and construction contract for Salalah Methanol Company’s (SMC) estimated $660m Luban ammonia plant.

The Montreal-based firm was one two shortlisted bidders - the other being South Korea’s Samsung Engineering - to build the 1,000-tonne-a-day plant in Salalah.

Work on the project is expected to begin this month with SNC-Lavalin initiating early works programme, the engineering firm said in a statement.

The project has yet to reach financial close, which is anticipated in June 2017.

MEED reported that a $660m club loan deal on the methanol project was under way, with a group of banks, including local Bank Muscat, Ahli Bank of Oman, Japan’s Mitsubishi UFG and two European banks interested in financing the project.

The Canadian contractor will continue with the engineering and procurement of equipment as well as the construction and commissioning of the facility. The plant will produce ammonia using a feedstock of hydrogen purge gas from the nearby methanol plant, operated by SMC.

The technology provider for the project is German chemicals firm Linde Group.

The petrochemicals project in Salalah forms part of the sultanate’s efforts to develop its downstream sector at ports such as Duqm and Sohar.

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