Manipulated-osmosis technology produces fresh water while cutting power, chemical and other operating costs.
As a result, the technology is more environmentally friendly than conventional reverse-osmosis or thermal-desalination processes.
The Al-Khaluf plant will be built alongside an existing desalination plant in the east of the country.
Modern Water opened an office in Oman in September.
It has also announced that it has produced the first fresh water from its first desalination plant, in Gibraltar.