The $660m Luban ammonia plant located in southern Oman has transitioned into the engineering, procurement and construction (EPC) phase.

The Salalah-based plant, which is set to produce 1000 tonnes-a-day of ammonia upon commissioning was awarded to Canadian engineering firm SNC-Lavalin in March. The contractor has started early works programme.

The authorisation for EPC comes before the project has reached financial closure, which was expected in June.

MEED reported that a $720m loan offering by developer Salalah Methanol Company (SMC) was subscribed 2.5 times.

Omani firm Galfar Engineering was awarded a two-year $62m contract for the construction and partial procurement for the methanol plant.

The Luban facility will produce ammonia using a feedstock of hydrogen purge gas from the nearby methanol plant operated by SMC – a wholly-owned subsidiary of Oman Oil Company.

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