Sultanate has embarked on a strategy towards greater downstream integration
Omans refining capacity has risen to 222,000 barrels a day (b/d) now that a multibillion-dollar expansion of the refinery at Sohar has been completed, according to industry sources.
The Sohar refinery has come onstream following a $2.7bn improvement programme to add new units, raising refining capacity from 82,000 b/d to 198,000 b/d. The main contract for the expansion was first tendered in late 2012 and was awarded to a consortium of the UKs Petrofac and South Koreas Daelim in 2014. However, construction work on the refinery, which was earmarked for a 2016 completion, had been delayed.
The new units added to process heavier Omani crude at the refinery were:
- Crude distillation unit
- Vacuum distillation unit
- Delayed coker unit
- Hydrocracker unit
- Bitumen blowing unit
The project owner, Oman Oil Refineries & Petroleum Industries Company (Orpic), declined to comment on whether the refinery is operating at full capacity. The additional capacity is expected to boost the production of naphtha and propylene from the Sohar Refinery by 70 per cent to meet rising consumption in the sultanate, which has grown at a rate of 10 per cent over the past five years, according to Orpic.
A 280-kilometre pipeline linking the Sohar Refinery with Omans oldest refinery at Mina al-Fahal, near the capital Muscat, to transport products, such as aviation fuel to storage facilities at Jifnain and the Seeb International airport has also been completed.
The two-way multi-product pipeline is expected to reduce heavy fuel tank truck traffic in Muscat, according to Orpic.
Oman, which is one of the smaller oil producers in the Gulf region, has embarked on a programme to develop its downstream industry.
Oman Oil Company in a joint venture with Kuwait Petroleum International is developing a 230,000-b/d refinery in the central town of Duqm. Three engineering, procurement and construction packages were awarded on the refinery project in July. The Duqm Refinery is expected to produce diesel jet fuel, naphtha, liquefied petroleum gas, sulphur and pet coke as its primary products using crude feedstock from Kuwait and Oman in the ratio of 70:30. The project has yet to reach financial close.
Upon commissioning, Omans total refining capacity will rise to 452,000 b/d. According to the BP Statistical Review of World Energy 2017, the total refining capacity in the Middle East currently stands at 9.31 million b/d.