Oman Oil Company (OOC) has signed a joint-venture agreement with South Korea’s LG International to develop a petrochemicals project at the sultanate’s northern port of Sohar.

The new company, owned 70 per cent by OOC and 30 per cent by LG, will invest an estimated $850m to build a plant to produce purified terephthalate acid (PTA) and polyethylene terephthalate (PET).

The plant will be developed in two stages to produce 500,000 tonnes a year (t/y) of PET – a plastic used to make bottles and packaging – and 1.1 million t/y of PTA, which is a raw material in PET production.

The partners expect to complete the project by the end of 2016. In October, general manager of OOC’s industrial subsidiary Takamul Investment Company said the front-end engineering and design (feed) study was likely to start in late 2012 or early 2013.